Benazir Bhutto
Economic issues

Bhutto was an economist by profession; therefore during her terms as prime minister, she herself took charge of the Ministry of Finance. Bhutto sought to improve the country's declining economy. She disagreed with her father's nationalisation and socialist economics. Soon after the collapse of the Soviet Union, Benazir attempted to privatise major industries that had been nationalised in the 1970s. Bhutto promised to end the nationalisation programme and to carry out the industrialisation programme by means other than state intervention; however, Bhutto did not carry out the denationalisation program or liberalisation of the economy during her first government. No nationalised units were privatised and few economic regulations were reviewed.

Pakistan suffered a currency crisis when the government failed to arrest the 30% fall in the value of the Pakistani Rupee from ₨. 21 to ₨.30 per U.S. dollar. Soon economic progress became her top priority but her investment and industrialisation programs faced major setbacks due to conceptions formed by investors based upon her People's Party nationalisation program in the 1970s. By the 1990s, Khan and Bhutto's government had also ultimately lost the currency war with the Indian Rupee which beat the value of Pakistan rupee for the first time in the 1970s. Bhutto's denationalisation program also suffered from many political setbacks, as many of her government members were either directly or indirectly involved with the government corruption in major government-owned industries, and her appointed government members allegedly sabotaged her efforts to privatise the industries.

Overall, the living standard for people in Pakistan declined as inflation and unemployment grew at an exponential rate particularly as UN sanctions began to take effect. During her first and second term, the difference between rich and poor visibly increased and the middle class in particular were the ones who bore the brunt of the economic inequality. According to a calculation completed by the Federal Bureau of Statistics, the standard of living for the rich improved while the standard of living for the poor declined. Benazir attributed this economic inequality to be a result of ongoing and continuous illegal Bangladeshi immigration. Bhutto ordered a crackdown on and deportation of illegal Bangladeshi immigrants. Her action strained and created tensions in Bangladesh–Pakistan relations, as Bangladesh Prime Minister Khaleda Zia refused to accept the deportees and reportedly sent two planeloads back to Pakistan. Religious parties also criticised Bhutto and dubbed the crackdown as anti-Islamic.

This operation backfired and had devastating effects on Pakistan's economy. President Khan saw this as a major economic failure despite Khan's permission granted to Bhutto for the approval of her economic policies. Khan blamed Bhutto for this extensive economic slowdown and her policy that failed to stop the illegal immigration. Khan attributed Bhutto's government members corruption in government-owned industries as the major sinkhole in Pakistan's economy that failed to compete with neighboring India's economy.
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