Political History of Pakistan 1990-93 – Nawaz Sharif’s First Term

Political History of Pakistan (1990 – 1993): Nawaz Sharif’s First Term

The first elected government of Benazir Bhutto (1988-90) collapsed when President Ghulam Ishaq Khan invoked Article 58-2-b on 6 August 1990. He cited the Pakka Qila crackdown in Hyderabad, growing sectarian unrest, and a clerical campaign arguing that “Islam bars female rulership.” New elections were set for 16 November 1990, opening the door for Punjab’s business-backed rising star—Nawaz Sharif.

1 | 1990 General Election & the IJI Coalition

  • Alliance: Sharif headed the Islami Jamhoori Ittehad (IJI), a nine-party bloc quietly encouraged by elements of the establishment.
  • Result: IJI secured 106 of 207 elected National Assembly seats (92 for PML-factions, 14 for allies); PPP won 44. With support from 20 independents, IJI mustered a working majority of 115.
  • Provinces: Punjab — IJI 205/240 seats → Sharif retained his home bastion. Sindh — PPP 57, MQM 20 → coalition government. NWFP (KPK) — IJI & ANP formed a coalition (IJI 17, ANP 12, PPP 7). Balochistan — fragmented house; JUI-F & regional parties shared power.

8 November 1990 — Nawaz Sharif took the oath as Pakistan’s 12th Prime Minister.

2 | Economic Pivot: Privatisation, Deregulation & Free-Market Reforms

Inherited state-run giants—steel, cement, banks, energy—had hemorrhaged since the 1970s nationalisation drive. Sharif’s cabinet approved the Privatisation Commission and placed 115 entities on the auction list.

  • Flagship Sales (1991-93): Allied Bank Ltd (51 % to employees), Muslim Commercial Bank (26 % public float), 8 cement plants, Pak-Saudi Fertiliser, Karachi Electric Supply Corp.
  • Proceeds: ≈ $900 million (World Bank data) funnelled to deficit reduction.
  • Export Surge: Goods exports grew from $4.8 bn → $5.4 bn — a 12 % jump.
  • GDP Growth: Averaged 4.6 %; manufacturing expanded at 9 %.
  • Investment Climate: Foreign direct investment trebled to $400 million; flagship Lakhra & Hub power projects were licensed on BOOT terms.

3 | Big-Ticket Infrastructure: The M-1 Motorway

Sharif’s private-sector instincts produced the Lahore–Islamabad Motorway (M-2). Ground-breaking in January 1992; Korean contractor Daewoo signed on a $1.2 bn turnkey basis—Pakistan’s first six-lane, access-controlled highway.

4 | Popular Schemes— and Populist Critiques

  • Yellow Cab Programme (1992): 60,000 Suzuki & Hyundai taxis financed at subsidised rates to cut unemployment.
  • Qarz Utaro, Mulk Sanwaro Drive: National “debt-retirement” bonds & voluntary donations generated PKR 9 billion; critics called it symbolism.
  • Small Loans & Tractor Credits: 185,000 beneficiaries but repayment rates stayed under 60 %.

5 | Islamisation 2.0 — Shariat & Social Codes

Elected on a Nizam-e-Mustafa slogan, Sharif tried to out-flank religious allies:

  • Shariat Act 1991 (9th Amendment draft): Declared Qur’an & Sunnah the supreme Law; passed National Assembly but stalled in the Senate.
  • Zakat & Ushr Overhaul: Collection base broadened; banks ordered to run interest-free counters (scheme fizzled when commercial banks balked).
  • Opponents, including JUI-F, branded the agenda “Sharab ki bottle — Zam-Zam ka label.”

6 | Security Quagmires

6.1 Operation Midnight Jackal Legacy

The 1990 caretaker months exposed an ISI cell’s attempt to buy PPP MNAs. Sharif dismissed Lt-Gen Hamid Gul (then Corps Commander Multan) in May 1991, mindful of lingering intrigue.

6.2 Operation Blue Fox / Clean-Up (1992)

Spiralling violence in Karachi prompted an army-led crackdown on MQM. Over 3,000 arrests, allegations of torture, and a rift with former ally Altaf Hussain. Sindh coalition crumbled; ethnic wounds deepened.

6.3 KP & Tribal Belt

Residual Afghan mujahideen morphed into criminal “car-lifters & drug-carriers.” Sharif instituted the Border Scouts Task Force, but funding was thin; opium flows persisted.

7 | Cooperative Societies Scandal (1992)

Punjab’s mushrooming “double-your-money” co-ops collapsed, wiping out PKR 17 billion in savings. PTV showed weeping pensioners; opposition framed it as proof of regulatory capture by PML loyalists.

8 | Foreign Policy: Pressler Chill & Riyadh Relief

  • Pressler Amendment 1990: After President George H. W. Bush withheld the annual nuclear waiver, $564 m worth of F-16s were embargoed.
  • Saudi Arabia: Sharif leveraged personal rapport with King Fahd; oil on deferred payments cushioned forex shocks.
  • Central Asia Opening: Pakistan recognised the new republics and hosted the Economic Cooperation Organization summit in Islamabad (1992).

9 | Presidency vs. Prime Minister

By early 1993, Sharif had pruned federal secretaries, pushed a partisan Eighth NFC Award (larger divisible pool, but Punjab-friendly formula), and sought to clip the President’s Article 58-2-b power.

  • 18 April 1993: Ghulam Ishaq Khan dismissed the government, citing “corruption, mis-governance and Blue Fox excesses.”
  • 26 May 1993: Supreme Court Federation v. Ahmed Saad Rafique case—unanimously restored Sharif.
  • Deadlock paralysed the state; IMF held back standby tranche; rupee slid 15 %.
  • 17 July 1993: Under army mediation (Gen. Waheed Kakar formula) both PM and President resigned; caretaker PM Balakh Sher Mazari → Moeen Qureshi steered to October 1993 elections.

10 | Assessment & Legacy

High-PointsLow-Points
• First large-scale privatisation wave
• M-2 Motorway ground-break
• Export uptick & FDI revival
• Assertive provincial development (water, rural roads)
 • Karachi Operation excesses (Blue Fox)
• Cooperative scandal wiped savings
• Incomplete Islamisation: Shariat Bill stalled, sectarianism rose
• Perpetual tussle with Presidency, failed institutional reforms

💬 We’d love your thoughts: Was Nawaz Sharif’s first term a necessary market correction after 20 years of statism, or did it trade stability for rapid deregulation? Drop your comment below — and follow this page so you never miss the next chapter (Benazir Bhutto v2 — 1993-96 is coming!).

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