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Pakistan: Militant attacks threaten economic stability

S. Khan Islamabad
December 5, 2022

The banned militant group Tehreek-e-Taliban Pakistan (TTP) has ended a cease-fire agreement with the government, and vowed to launch attacks across Pakistan. What will this mean for the country's economy?

A member of a crime scene unit surveys the site after a suicide bomb blast on a police patrol in Quetta on November 30, 2022

Last week, Tehreek-e-Taliban Pakistan (TTP), which has links to the Afghan Taliban, carried out a suicide attack in the western city of Quetta, killing four people and wounding several security personnel.

A local police officer said that that the blast had targeted a police team who were preparing to escort a polio vaccination team. 

On Saturday, the militant group ambushed a police vehicle that was patrolling the northwestern town of Nowshera in Khyber Pakhtunkhwa province, which borders Afghanistan.

These attacks follow the unilateral decision of the TTP to end a fragile cease-fire with the Pakistani government in Islamabad.

Who are the TTP?

The government has a complicated relationship with the TTP that it banned in 2008.

The group has claimed responsibility for numerous attacks in Pakistan, most notably the school attack in Peshawar in 2014, which killed 149 people, including 132 children.

It has also attacked Pakistani soldiers and military checkposts, drawing the ire of the army command. 

It had been weakened by military operations but started regaining strength after the Afghan Taliban returned to power in Kabul in 2021.

In May of this year, Afghan Taliban-mediated negotiations between Islambad and the TTP had led to a "permanent cease-fire" in return for the release of dozens of militants and commanders. But analysts say that cease-fire violations were frequent and widespread.

TTP's comeback

One of the TTP's demands is that the semi-autonomous status of the former Federally Administered Tribal Areas (FATA) bordering Afghanistan be restored. The Pakistani government merged the FATA region with northwestern Khyber Pakhtunkhwa province in 2018 to improve governance there.

However, the area is widely considered a haven for militants who operate on both sides of the border.

Said Alam Mehsud, a security analyst in Pakistan, told DW that the end of cease-fire was a worrisome situation for the Pakistani authorities.

"The militants are openly demanding extortion money in the northwestern areas," he said, adding that locals felt increasingly insecure.

Bushra Gohar, a former lawmaker, claimed that even ministers had had to pay extortion for the safety of their families.

She told DW that the TTP had formed shadow governments in many districts of Khyber Pakhtunkhwa province, adding that the group also collected funds for its jihadist activities in the area. She expressed disappointment that the government in Islamabad was not being more proactive: "Prime Minister Shehbaz Sharif has not called an emergency meeting to tackle the security situation," Gohar said.

Pakistanis struggle to fuel everyday life

Economic toll

Husain Haqqani, a former Pakistani ambassador to the US and director for South and Central Asia at the Washington DC-based Hudson Institute, also warned that the TTP posed an economic threat.

"Pakistan could soon find itself having to confront a major security challenge from the TTP," he told DW, adding that China's economic projects in Pakistan and Afghanistan could be imperiled.

China has invested heavily in infrastructure projects in Pakistan, as part of the China-Pakistan Economic Corridor, project, which is a component of Beijing's Belt and Road Initiative.

Ghulam Mustafa, a Lahore-based security analyst and former military official, agreed that the attacks could jeopardize the economic partnership between China and Pakistan.

"The deteriorating security situation could scare off foreign companies and they could be forced to pull out their investments [from the country]," he told DW. "This would deal a severe blow to an already crippled economy." 

Devastating floods, the COVID pandemic, and ongoing political turmoil have all had a negative impact on Pakistan's economy, and many experts are of the view that the South Asian country really cannot afford a security challenge.

Shahida Wizarat, a Karachi-based economist, said that the deteriorating security situation in the country would force businesses to take extra measures for their protection. "They will ask the government to provide them with more security," she told DW.

"This will increase the cost of doing business, which is already high," she said.

Former Afghan lawyer fears for her life in Pakistan

Edited by: Wesley Rahn