The ongoing negotiations between the Pakistani government and the banned Tehreek-e-Taliban Pakistan (TTP), which are taking place in Afghanistan, are in danger of failing as long as terrorist attacks continue unabatedly. This could make it more difficult for Pakistan’s administration to put an end to the violence that has plagued the unrest-ridden border area for almost 20 years. Pakistan recorded 99 terrorism-related fatalities in July, down from 102 in June.
Security force fatalities have decreased, although the overall death toll in this group is still high. Although no party has taken responsibility for the majority of these killings, it is highly likely that the TTP was behind them considering that most of the casualties took place in Khyber Pakhtunkhwa, where the TTP operates.
In addition, the schism in the ruling coalition, animosity between the government and Imran Khan’s Pakistan Tehreek-e-Insaaf, and the poor economic condition all point to increased systemic instability. Pakistan’s economic circumstances significantly deteriorated in July and are probably going to get worse. The rupee reached a record low on July 29 on the open market, trading as high as $250 to the dollar. Over the last few months, the rupee has fallen by 20%. The market fear brought on by political instability is one of the factors contributing to the rupee’s decline.
Pakistan’s current account deficit grew to a four-year high of USD 17.4 billion in the fiscal year 2021–22, according to a report from the State Bank of Pakistan on July 27. The deficit for the 2020–21 fiscal year was only 2.8 billion. The enormous disparity is a sign of very serious balance of payments issues. The latest standoff resulted from the TTP’s refusal to budge from its demand that the former Federally Administered Tribal Areas be separated from the province of Khyber Pakhtunkhwa.
In May 2018, a constitutional reform combined the Khyber Pakhtunkhwa province with the Federally Administered Tribal Areas. The Federally Administered Tribal Area merger is opposed by the TTP because it diminishes their regional clout. Islamabad cannot accept the demand.
On July 30, a 17-person delegation headed by attorney Mohammad Ali Saif, Mahmood Khan’s special assistant for communications and public relations, as well as tribal elders and lawmakers, arrived in Kabul for a four-day visit to begin negotiations with the TTP. However, it repeated its demand for the restoration of the tribal territories’ former status.
A major headache is the Khorasan Province of Islamic State.
July saw two incidents that were claimed by the Islamic State-Khorasan Province. Two people were killed on July 12 in a targeted attack on intelligence officers in Khyber Pakhtunkhwa’s Mohmand area. Two more people died on July 16 as a result of a targeted attack on a police checkpoint in Peshawar city.