I think instability was one of the reason why Pakistani Cricket has failed to deliver in recent times. There's no lack of interest in the country as cricket is the most popular sports. The attack on Sri Lankan cricket team was on of the largest setback for cricket in pakistan and as there are increasing number of domestic cricket, international games being placed on Pakistan are still rare. There were some sign of progress with the new leadership and I hope as a cricketer himself, the prime minister of Pakistan would be able to bring back Pakistan to it's previous glory within his term.
There are mainly two reasons why cricket in Pakistan is in a difficult situation. First of all, the majority of the matches needs to be staged in UAE. This involves additional expenses, and a large fraction of the PCB annual revenues are used for this. The funds are simply transferred to the Emirates Cricket Board (ECB), who also keeps most of the gate collection. Fortunately, teams have shown more interest in visiting Pakistan now, and this should enable PCB to cut down on their expenses.
Secondly, Pakistani cricketers are banned from the IPL. For most of the other boards, the top players receive around 75% of their annual salary from the IPL and this option is not there for the Pakistani players. PCB also suffers, because 10% of the salary paid to the overseas players are deducted as royalty fee by the respective boards.