17/05/2016 8:22 AM IST | Updated 15/07/2016 8:26 AM IST

Panama Papers: How Nawaz Sharif Keeps Sweeping Polls Without 'Moral Authority'

RIZWAN TABASSUM via Getty Images
Pakistani men watch a televised addresses to the nation by Prime Minister Nawaz Sharif in Karachi on April 22, 2016. Pakistani Prime Minister Nawaz Sharif on April 22 announced to request the supreme court to form a comission for investigation into the allegations made in the Panama papers that linked his family to a series of offshore companies. / AFP / RIZWAN TABASSUM (Photo credit should read RIZWAN TABASSUM/AFP/Getty Images)

Pakistani premier Nawaz Sharif has again forced political nemesis Imran Khan, chief of Pakistan's Tehreek-e-Insaaf (PTI) party, to eat humble pie after the candidate fielded by his Pakistan Muslim League faction (PML-N) pulled off a stunning by-poll upset deep inside enemy territory.

Arbab Waseem, the PML-N candidate for Peshawar's PK-8 provincial assembly seat cruised to a surprisingly easy win over PTI rival Shehzad Khan on May 12. Shehzad was backed by the ruling party alliance in Khyber-Pakhtunkhwa province comprising PTI, Jamaat-e-Islami and Qaumi Watan Party. The PML-N had similarly triumphed in a Balochistan national assembly by-poll two weeks earlier.

These victories put paid to the notional argument parroted by Sharif's opponents that the Panama Papers had eroded his "moral authority." Voters raised on the teats of plutocracy also reminded Khan that he who rules Punjab, rules Pakistan, and that stump sermons on western morality, however impressive, had no practical value in a country where keeping your local influential happy was paramount to getting things done.

His swagger and impish smile have returned, but the week following the Panama leaks in early April weighed heavily on Sharif. Though he was not personally named, the revelation that both his sons owned offshore companies sparked a political firestorm. Rivals accused Sharif of secreting ill-gotten wealth abroad through his children, while playing pauper in annual tax returns at home.

With Khan recently fessing up to his own offshore company, Sharif need no longer counterpunch to survive.

A visibly shaken premier then quickly took to the airwaves, addressing the nation twice in two weeks and unconditionally offering himself up for accountability. He even agreed to a judicial probe helmed by the Chief Justice of Pakistan if that would shut the opposition up.

Khan, having perfected his policy U-turns into a pirouette, however redrew the battle lines again, this time around the government's Terms of Reference (TORs) of such a probe, insisting that Sharif be the focus of investigation instead of getting lumped together with the hundreds of other Pakistanis featured in the leaks.

The supreme court, too, wary of being pulled into a political logrolling contest, agreed with Khan, suggesting the current TORs were far too ambitious in scope for a timely outcome and asked for new, custom-made legislation through parliament. Meanwhile, blood thinners from Sharif's London trip kicked in, calmed him down, and he decided to go on the offensive.

Sharif pumped billions in taxpayer money into print and television ads defending his family from money laundering accusations and trumpeting his government's achievements. He also undertook a national "public contact" campaign, speaking to packed crowds around Pakistan and absentmindedly promising the same road or highway for the nth time since 1997.

Regardless, Sharif is a very lucky man insofar as all his rivals are varying levels of crooked. With Khan recently fessing up to his own offshore company, Sharif need no longer counterpunch to survive. He will likely revert to the PML-N's time-tested "good cop, bad cop" strategy, where Sharif sagely preaches political unity, but lets his party's foul-mouthed young Turks tear into the opposition leadership.

Indeed, barring his capacity for self-sabotage, there is nothing keeping Sharif from completing his third term in office.

With no financial intelligence sharing treaty with Panama in place to verify the leaks, who will prove his crime? Indeed, barring his capacity for self-sabotage, there is nothing keeping Sharif from completing his third term in office. In the past, he got drunk on power and counterintuitively picked fights with both the army and judiciary.

PML-N partisans ransacked the supreme court in 1997 with Sharif's blessings after he was charged with contempt of court for hurling insults at the sitting chief justice. A year later, he forced then army chief Gen. Jehangir Karamat to resign after the latter dared criticize Sharif's national security policy. His unchecked ego eventually ran into an ambitious Gen. Pervez Musharraf and the rest is history.

This time around, Sharif has consciously played it safe with civil-military relations. He has dutifully let the army run Pakistan's foreign and defense policies to avoid confrontation. Puppet officials steer these portfolios on paper, but all decisions go through General Headquarters. As a reward, the army has for the most part stayed out of politics even as anonymous campaigns beseech its haloed chief, Gen. Raheel Sharif, to take back his retirement decision for Pakistan's sake.

He has dutifully let the army run Pakistan's foreign and defense policies to avoid confrontation.

That said, ceding governance space is fraught with peril since it is human nature to keep wanting more. Although decidedly apolitical, Gen. Sharif has in recent months subtly criticized his namesake for lack of progress on key components of the National Action Plan against terror. He also ordered a paramilitary operation in Punjab pursuant to the Lahore park attack without waiting for the premier's consent.

Moreover, in a clear message to Islamabad following the leaks, the army chief in April stripped eight senior officers of their ranks after an internal inquiry judged them guilty of corruption. Reportedly, Gen. Sharif also urged the premier to come clean about his offshore assets during a one-on-one meeting in mid-May.

All this pressure will leave the civilian Sharif itching for payback. With the general either uninterested in or being denied an extension, depending on what rumors you believe, the premier's decision on Gen. Sharif's successor in July will shape his last two years in office. It is a dicey situation. He yearns for another Karamat to boss around, but worries about the next Musharraf in sheep's clothing.

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