In Pakistan, political rivalry increasingly extends beyond parliament into police stations and courtrooms. After almost every change of government, FIRs are registered, investigations are reopened, arrests are made, and political leaders face imprisonment. Whether allegations are valid or not is a matter for the courts; however, the repeated pattern has produced a damaging economic consequence. Politics has gradually turned into legal warfare, and the economy has become its unintended victim.

This phenomenon is not merely a political or constitutional concern. Its deepest impact is economic, particularly on investor confidence and foreign investment. An economy survives on predictability. Investors, both domestic and international, commit capital only when they can foresee a stable environment. When political leadership spends its time in courtrooms rather than in cabinet rooms, governance weakens and policy continuity becomes uncertain.

Investors do not analyse speeches; they analyse behaviour. Recurring arrests of senior political figures, travel restrictions, prolonged trials, and imprisonment send a powerful signal that political stability is fragile. Under such conditions, business planning becomes nearly impossible. Large projects such as factories, energy plants, mining ventures, and agro-processing industries require long-term stability, often extending over decades. Court-driven politics creates a short-term atmosphere in which serious investors hesitate to commit capital.

Foreign investors in particular are highly sensitive to political risk. Governments may announce tax concessions, special economic zones, and regulatory incentives, yet investors first ask about the security of their agreements. They need assurance that contracts signed today will remain valid tomorrow. When they observe repeated prosecutions of previous leaderships, they fear that policies associated with those governments may also be reversed or reviewed. As a result, investment decisions are postponed, partnerships are delayed, and planned projects are quietly withdrawn. In many cases, investment does not officially leave the country; it simply never arrives.

Domestic investors follow the same signals. Business groups respond quickly to uncertainty by protecting their wealth rather than expanding it. Instead of establishing new industries, they shift funds toward real estate, foreign currency, gold, or overseas ventures. Such defensive investment preserves individual assets but produces no employment, exports, or productivity for the national economy. Productive investment declines not because entrepreneurs lack resources, but because they lack confidence in continuity.

Political legal confrontation also affects the financial system. Markets react immediately to instability. Share prices fluctuate, institutional investors withdraw funds, and demand for foreign currency rises. Businesses and individuals seek protection against uncertainty by converting savings into dollars. This pressure weakens the local currency, making imports more expensive and contributing to inflation. Consequently, a political arrest or court confrontation eventually appears in the form of higher fuel prices, electricity tariffs, and food costs.

Administrative functioning is similarly affected. Civil servants observe that decisions taken under one government may later become subjects of investigation under another. Even routine approvals may be questioned in the future. To avoid risk, officials delay files, avoid signatures, and postpone procurement decisions. Investment projects require numerous administrative permissions such as land allotment, taxation clearance, licensing, and customs facilitation. When bureaucracy becomes cautious, investors interpret delay as systemic instability. Many eventually abandon projects altogether.

International financial partners also consider political stability before engagement. Governments preoccupied with legal defence cannot concentrate fully on economic reform. Structural reforms requiring political consensus become difficult to implement. Negotiations lose credibility because policy continuity appears uncertain. Consequently, the country depends repeatedly on short-term external financial support rather than sustainable economic expansion.

The final impact emerges in employment and living standards. When investment declines, industries do not expand and job opportunities shrink. Youth unemployment rises while inflation reduces purchasing power. Ordinary citizens may not follow court proceedings, yet they feel their consequences through higher prices and limited economic opportunities.

Registration of FIRs, arrests, and imprisonment of political figures may appear to concern only politicians, but their economic consequences spread across the entire society. Legal confrontation weakens confidence, discourages foreign direct investment, delays domestic expansion, destabilises currency, and fuels inflation. Investors seek one assurance above all: continuity of state policy regardless of political change. When politics becomes retaliatory, that assurance disappears.

Political revenge may provide temporary political satisfaction, but economically it imposes lasting national loss. Pakistan’s prosperity depends not only on sound economic policies but also on restraint in political conduct. Stability in governance, stability in law, and stability in political behaviour are prerequisites for economic growth. Until political transitions occur without courtroom battles and imprisonment, economic confidence will remain fragile and foreign investment hesitant.

Dr Alamdar Hussain Malik
Advisor Veterinary Sciences
University of Veterinary and Animal Sciences, Swat
Former Financial Adviser Finance Division,Government of Pakistan