Panama Papers: Pak braces for Supreme Court decision that could remove Sharif

Islamabad: A looming Supreme Court decision that could disqualify Pakistan Prime Minister Nawaz Sharif over corruption allegations had the country on edge Wednesday, as a drawn-out investigation related to the "Panama Papers" leaks neared a conclusion.

Disqualifying Sharif would leave his party in power, but it would cause intense turmoil at a time when Pakistan is experiencing modest growth and improved security after years of violence, and the civilian government and powerful military have appeared to come to uneasy terms.

Sharif has denied any wrongdoing, but the Supreme Court agreed to investigate his family's offshore wealth late last year after opposition leader Imran Khan threatened street protests.

It could clear the prime minister, or order a further judicial commission of inquiry or even declare him ineligible to hold office, as it did in 2012 with then-Prime Minister Yusuf Raza Gilani over a contempt of court case.

Pakistani stocks fell 1.5 percent in early trade after the news overnight that a decision would be announced on Thursday afternoon. The benchmark KSE 100 later regained some ground but was still in negative territory by midday. Both the government and opposition expressed confidence on Wednesday.

"There is no chance that decision will come against our leadership. Our government and entire leadership are performing their duties as per routine," Talal Chaudhry a prominent leader of Sharif's Pakistan Muslim League-Nawaz told Geo Television.

Naeem ul Haque, a spokesman for Khan's Pakistan Tehreek-e-Insaf (PTI) said he expected a verdict against Sharif, but he made clear the opposition would not launch a new street movement if they were disappointed.

"Imran Khan has clearly stated that we will accept the decision of the Supreme Court, but we believe that enough evidence has been presented to remove the prime minister and that a verdict should be reached that is based on the evidence," he said.

In 2014, Khan led a months-long protest that paralyzed the government quarter in the capital, Islamabad, after rejecting Sharif's decisive election win a year earlier.

The case stems from documents leaked from the Panama-based Mossack Fonseca law firm appeared to show that Sharif's daughter and two sons owned offshore holding companies registered in the British Virgin Islands and used them to buy properties in London.

Sharif told parliament last year that his family wealth was acquired legally in the decades before he entered politics and that no money was siphoned off-shore.

Khan, however, has argued that the prime minister's lawyers have changed stories on the source of the offshore money several times and that it is up to Sharif to prove the offshore companies were not used for money laundering.

Corruption is endemic in Pakistan, which ranks a dismal 116th out of 176 in Transparency International's annual index of the world's most graft-ridden countries.