The latest terrorist attack in Peshawar confirms that the scourge of terrorism in Pakistan has returned with vengeance. This comes at a time when the economy is in serious trouble.

On 30 January, over 100 people were killed and over 200 others were injured in a terrorist attack in Peshawar, Pakistan. The mosque where the attack occurred was located in the most secure zone of the city, where the police and other security agencies are located. This is one of the deadliest attacks to hit the city in many years. It was claimed by the Mohmand chapter of the banned Tehreek-i-Taliban Pakistan (TTP). However, later TTP Central denied any involvement in the act. Most of the victims were police officers. The TTP — a US State Department-designated Foreign Terrorist Organization — was also responsible for the massacre of over 140 people, including 132 children, at a school in that same city in December 2014.

The question that everyone is asking themselves is how this was possible in the Red Zone of the city. It’s not clear whether it was a suicide bomber or if a bomb was planted inside the mosque. Either way, most people agree that there must have been a degree of inside help to execute this terrorist act successfully.  Several suspects connected have since been arrested. Not only does this attack point to an utter failure in security and intelligence, but it reaffirms the TTP’s message: “we can kill you anywhere, anytime, including in mosques, and the army and government cannot protect you.”

Since the Taliban took over in Afghanistan in August 2021, TTP attacks have increased by 84 percent. This is principally because the TTP, which is ideologically, tribally, and operationally closely affiliated with the Taliban, has rear bases in Afghanistan from where it has been able to launch attacks back into Pakistan. Even though the Taliban has condemned the attack, no one is fooled by those words. Since the Taliban took over, Pakistan has been demanding that the Taliban shut down the TTP camps in Afghanistan with its estimated 6000 fighters. The Taliban has refused to oblige, and it is unlikely that they will do so in the near future. This confirms that Pakistan’s support for the return of the Taliban in Kabul was always a bad idea.

In an attempt to halt the TTP attacks, the previous government of Imran Khan entered into negotiations with the TTP in October 2021. These were facilitated by the Taliban and a ceasefire was implemented. However, these negotiations made no progress and ended in November 2022, when the TTP called off the ceasefire. While there were no terrorist attacks during the talks, the time wasted in negotiations gave the TPP an invaluable opportunity to regroup in different parts of the country. For example, a day after the Peshawar attack, a police station in Mianwali, Punjab, came under a gun attack by heavily armed TTP fighters. While the attack was repulsed, it illustrates the extent of the TTP’s present reach along areas of the Afghan-Pakistan border.

To date, all negotiations with local terrorist groups have failed. With terrorists like the TPP becoming more emboldened, and the attacks larger and more sophisticated, the call for a military solution has become louder. However, given the nature of counter-terrorism and the difficult terrain the TTP operates in, it’s unlikely that the current prime minister, Shehbaz Sharif, will be able to show any real progress on this front, at least over the next six months. Accordingly, there’s a very good chance that Imran Khan will have further increased his popularity with this latest terrorist act. His party, the Pakistan Tehreek-e-Insaf, has won most of the provincial by-elections since being ousted from office in April 2022.

Paradoxically, this sad episode is nevertheless an opportunity for the newly appointed chief of army staff (COAS), General Asim Munir, to make his mark and to demonstrate that the Pakistan army is serious when it comes to eradicating terrorism. This is perhaps required to dispel any suggestions that some elements of the army are working behind the scenes with the TTP.  It’s also an opportunity for the army to clean up its image. There’s widespread feeling — repeatedly reinforced by statements made by Imran Khan — that recently departed COAS General Qamar Javed Bajwa was instrumental in the removal of the former prime minister in a vote of no confidence in April 2022.

At any rate, the military will need to be seen doing something. This means it will need to ruthlessly go after the TTP not only inside Pakistan but in Afghanistan as well. The Pakistan army will be very reluctant to do this, but they have no choice if they want to see an end to terrorist acts throughout the country. Given that bilateral relations with Kabul are already at an all-time low, that should not be a critical factor in the army’s counter-terrorism calculations.

This latest terrorist attack comes at a time when the country’s economy is in free-fall. Pakistan’s annual inflation rate is at 28 percent — the highest in 50 years. Its foreign exchange reserves are down to just over US$3 billion, only enough to pay imports for three weeks. Meanwhile, the value of the rupee is falling daily, and unemployment is rising steadily. Several international interest repayments are also coming to maturity in the next few weeks. An International Monetary Fund (IMF) team recently visited Islamabad to negotiate the harsh conditions the government will need to impose on the country if it wants to unlock a $7 billion loan. Sharif didn’t sugar-coat the situation when he stated, “Our economic challenges at this moment are unimaginable. The conditions we have to fulfil are beyond our imagination.” Nevertheless, if Pakistan doesn’t reach an agreement with the IMF, the country may soon be unable to pay for its oil imports that are needed to run its electricity plants. In January a nationwide power blackout effectively shut down the economy for a day. However, even with a stop-gap IMF loan, many believe the country, which is still reeling from the devastating floods of last summer, is in such dire straits that only a large and immediate bailout will save it from the same fate as Sri Lanka in 2022. Sadly, no country is rushing to throw that critical economic lifeline.

While Imran Khan, who survived an assassination attempt in November 2022, is by far the most popular politician in Pakistan today, it is debatable that upon a return he would be able to eradicate the growing threat of terrorism and fix a collapsing economy. But failure to do so could quite possibly lead to state collapse, with all the dire and far-reaching consequences this would mean for the nuclear-armed country of 220 million people, the region, and beyond.

Dr Claude Rakisits is an Honorary Associate Professor at the Australian National University and a Visiting Research Fellow at the Brussels-based Centre for Security, Diplomacy and Strategy. His twitter handle is @ClaudeRakisits.

This article is published under a Creative Commons Licence and may be republished with attribution.