The bargain underscored an increasingly urgent problem for both Pakistan and its internationals backers, in particular the United States, which has pushed the government to boost its tax collection and make hard economic choices to ensure the nation’s solvency. If the government wants to survive, the week’s turmoil indicated, that may be all but impossible.
Pakistan, then, may remain dependent on infusions of international assistance, including billions in military and civilian aid from the United States, even as less than 2 percent of Pakistanis pay income tax, including many wealthy members of government, making Pakistan’s tax revenues among the lowest in the world.
The effort to increase tax revenues and to end costly subsidies for energy was strongly pushed by American officials and the International Monetary Fund, as a way to close gapping budget shortfalls. The need for reforms was not just a matter of economics, but also a way for the government to expand services and increase its presence in the lives of Pakistanis as the country faces a rising tide of militancy.
The party, the Muttahida Qaumi Movement, or MQM, broke with Mr. Gilani’s ruling Pakistan Peoples Party last weekend in part to protest fuel price increases and other proposed reforms, setting off a political crisis for the prime minister and President Asif Ali Zardari. This week opposition parties echoed the call to reverse the price increases and other reforms and threatened to bring down the government with a no-confidence vote.
In his effort to lure the MQM back to his coalition, Mr. Gilani extended further economic concessions in a meeting with party officials Friday, saying his government would put off efforts to increase tax collection.
Secretary of State Hillary Rodham Clinton criticized the reversal of the fuel price increases and proposed tax reforms, saying on Thursday that it was “a mistake to reverse the progress that was being made to provide a stronger economic base for Pakistan.”
Some analysts feared the move by the Gilani government would now leave it vulnerable to further challenges by elements of its coalition and opposition parties and efforts to extract still more concessions in the future.
But the move was apparently a precondition to regain the support of the MQM. After days of frantic negotiations, Raza Haroon, a senior party leader, announced Friday that his party would rejoin the coalition for the sake of democracy and the country.
Repairing the coalition also dissipated some domestic political tension, which deepened this week with the assassination of Salman Taseer, and key ally of President Zardari and the governor of Pakistan’s most important province, Punjab.
Mr. Taseer had led a campaign to roll back the country’s strict blasphemy laws, which human rights groups say have been used to persecute religious minorities. He was also an outspoken secularist in a country that has fallen increasingly under the sway of fundamentalist religious parties and extremist groups, like the Taliban, which have threatened the government with a years-long campaign of suicide bombings in major cities and an active insurgency.
Mr. Taseer’s assassination revealed the dangerous rift that has opened between secular and religious forces at all levels of the society, including within the government. Even moderate religious leaders declined to codemn the attack. Most government and military officials, as well as opposition leaders, were also silent.
The assassination, which was carried out by an elite police officer who was assigned as a body guard of the governor, raised deep concerns for the United States, both about possible infiltration of extremists in the country’s security forces as well as the extremist drift of the country.
Since the 26-year-old assassin, Malik Mumtaz Hussain Qadri, proudly confessed to the police, he has been greeted by enthusiastic crowds, who showered him with rose petals before court appearances this week.
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