Finance Minister Miftah Ismail seems a different, far more confident man just than a few months ago when he seemed worried about the prospect of default if the IMF bailout program was not salvaged. He did seem pretty convinced, though, that the implementation of painful austerity measures will save the extended fund facility just in time to avert a Sri Lanka-like situation, and that does seem to be happening. Indeed, speaking to a TV channel the other day, he felt pretty good about the way the equity and currency markets had rebounded on positive signals from the IMF and attributed it, quite as expected, to “crucial policy amends and austerity measures.” That much is alright and a far more pleasant prospect than the writing on the wall just a few weeks ago. But was he right in saying that the crisis had been averted? Let’s not forget that Pakistan still needs to make upwards of $40 billion in debt and interest payments in this fiscal, and more than the remainder of the $6 billion that IMF’s agreement will give us, it will also enable us to borrow more and at better rates in the international market; including from friendly countries. But there is far too much toxicity in the political environment for investors to happily park any funds in Pakistan anytime soon. For one thing, there’s still no telling when the next election, which PTI is clamouring for, is going to be held, or if it will really derail the Fund program and send us tumbling once again into sovereign default if it’s called too soon. For another, the political elite clearly has no qualms about dirtying the atmosphere if that is what it takes to have the last word and come out stronger in the next day’s headlines. And if that goes on for much longer, and the paralysis it has caused spreads any further into the administrative machinery, Mr Ismail–despite his surgeon-like touch that has all but saved the economy–might have second thoughts as well. *