All that stands between Pakistan and a descent into the same maelstrom of massive devaluation, bankruptcy, unemployment and civic unrest that has swallowed much of south-east Asia is a visit by the International Monetary Fund - and yesterday it was postponed. A $5bn package designed to bail out the country is likely to be held up.
The delay has probably been caused by the action of prime minister, Nawaz Sharif, who is beset by allegations of corruption. Last week he cancelled a contract with the British-run independent power producer Hubco (the biggest in the country), raided its offices looking for incriminating documents, and issued warrants for the arrest of some of the firm's top executives on charges of corruption and fraud. As they were out of the country, he then ordered extradition proceedings.
"If they really wanted to frighten off foreign investors," said a Western diplomat, "they couldn't have found a better way to do it. Investor confidence has been shot to pieces."
Yet one of the tasks before Mr Sharif and his commerce minister, Ishaq Dar, in their talks with the IMF, is to guarantee foreign investors a friendly welcome.
Mr Sharif has been acting as though, far from trying to inch back from the precipice of bankruptcy, he has just stumbled on a cache of funds. He slashed 50 per cent off a recently imposed electricity surcharge, cutting bills overall by 30 per cent. He distributed land to landless peasants in Baluchistan and announced the building of new motorways, no matter what.
Meanwhile, Mr Dar was claiming broad policy agreement had already been reached with the IMF and the World Bank, and the new programme would probably be approved by mid-November. IMF sources responded frostily the next day that "negotiations are still continuing", and yesterday's postponement makes an early deal even less likely.
The independent electricity producers were lured to Pakistan to cure the country's chronic power deficit. This they achieved in a manner hailed as a model for other developing countries. But the nationalised (and monstrously inefficient) power distribution authority, Wapda, could not pay its bills, and is now massively in default.
Mr Sharif's bull-headed solution of criminal arrest warrants, raids, and cancellation of contracts are all attempts to batter the producers into submission.
Yet wealthy Islamabad continues to live in its own dream. The power supply is impressively constant and stable compared with, say, India. Better still, for many in the elite it is completely free. One expatriate woman from Lahore said she had been trying to get Wapda to send her an electricity bill for three years.
The joke goes that Wapda has more employees than there are income-tax payers in Pakistan. Yet, rather than tackle the malaise, the prime minister indulges in populist gestures that can only make it worse.
In the economic collapse that lies around the corner for Pakistan, it is doubtful whether Mr Sharif will manage to hold on to his job. But in the 20 months since taking office, he has certainly done everything to ensure it.
Imagine that after Tony Blair romped home in Britain's general election, that was not enough for him. Within months of gaining power, picture him firing the Lord Chief Justice, packing the High Court with judges of his own choice, replacing the Privy Council with New Labour yes-men, arranging the resignation of the head of the armed forces and starting to intimidate journalists who were negative towards his government.
This, broadly, is what has unfolded in Pakistan since the landslide victory of Mr Sharif and his Pakistan Muslim League. That result looked like a mandate for stable government. But for Mr Sharif, whose previous term as prime minister ended ignominiously in 1993 when he was sacked by the president for misrule, it was not enough. One by one he has hijacked the organs of the state.
The extraordinary events of the past fortnight, in which he accepted the resignation of the head of the army, replaced him with an ally, and forced through the lower house of parliament a constitutional amendment which makes it easy for him to assume dictatorial powers, was the culmination of a long process in which he has brought the presidency, his own political party, the judiciary and now the military to heel.
The big question is why, given his overwhelming parliamentary majority, Mr Sharif has felt compelled to do this. "Democracy in Pakistan is driven by the ethics of war, not sport," said Maleeha Lodhi, editor of The News, a national daily. "There can't be any compromise with an enemy here: the enemy must be killed."
All the previous three elected governments - one of Mr Sharif's and two of Benazir Bhutto's - were dismissed before the end of their term.
"Sharif has become so obsessed with survival," Ms Lodhi continued, "that he has taken out one political insurance policy after another. But he is not using this power to any end. The paradox is that the more power he accumulates, the less authority he has. Formally he is the most powerful prime minister in our history. But, in fact, he is presiding over a country in disarray, presiding over a state that has never been weaker."Reuse content