Pakistan’s days of extracting geopolitical rent are over. What next?

Pakistan has immense latent capabilities to be a valuable partner for its key strategic partners, but its ruling elite must wake up to new realities.
Published July 29, 2022

Since its independence some 75 years ago, Pakistan’s ruling elite have thrived on foreign largesse. Over the decades, the desire to benefit from geopolitical rents has become innate.

Lulled into a comfortable life, the current generation of this class is blind to how the geopolitical sands have shifted under their feet. Rather than wake up from their slumber and find a way to steady themselves and the country in today’s world, the country’s elite are insistent on staying firmly in place, no matter the consequences.

Since the turn of the 21st century, Pakistan’s stability has been underpinned by four main patrons — the United States, China, and the Gulf monarchies of Saudi Arabia and the United Arab Emirates.

It was the United States that offered a lifeline to Musharraf’s dictatorship following the 9/11 terror attacks. With loans restructured and Uncle Sam sending oodles of money to Islamabad and Rawalpindi, the good times had come back.

As the dictatorship collapsed under the weight of its own illegitimacy, the country stared into the abyss. But Washington needed a stable and secure Pakistan — the last thing anyone in the world wanted was the collapse of a nuclear-armed country and possible takeover of its nuclear assets by terrorists. Saudi Arabia and the United Arab Emirates — long-time strategic allies — also got involved, playing the role of political guarantor and lender of last resort.

Enter China

By the time Washington soured on Pakistan, a new economic player was in town — China.

Another strategic ally, China was flush with cash and confidence at the time. It was done with hiding its strength and biding its time, and so embarked on a massive push to expand its global economic influence.

Islamabad, given its historical relationship with Beijing, emerged as a key target, especially because it was a neighbouring country whose economy was on the brink. Crippled by terrorism and power blackouts, Pakistan needed a saviour which emerged in the form of the China-Pakistan Economic Corridor (CPEC).

The good times rolled again, but like previous such cycles, Pakistan once again was on the brink. This time around, however, the geopolitical gods were not inclined to be kind to Pakistan and its ruling elite. A multipolar world was emerging and great power competition was back in vogue; the coronavirus only accelerated the pace of events.

Lessons from history

In the past, great power competition between the United States and the Soviet Union had been a boon for Pakistan, but this time around the action was in East Asia.

Washington’s foreign policy establishment, which had begun its pivot to Asia under Obama in fits and starts, was shocked and awed by Donald Trump.

Read more: Geopolitics in unsettled times

China was priority number one, meaning that the forever war in Afghanistan had to be wrapped up. Biden continued this policy, clearly signalling that the only country in South Asia that he had a personal interest in was India.

This view was reinforced by the collapse of Ashraf Ghani’s regime in the backdrop of the withdrawal of American forces; Imran Khan’s statement that Afghans had broken the shackles of slavery underscored the view in Washington that Pakistan was not worth the drama.

Modernising the Gulf

During this period, a major shift occurred in the Gulf monarchies as well. The emergence of a younger, more globally connected leadership in Saudi Arabia and the United Arab Emirates altered the regional geopolitical map.

The Arab monarchies were now interested in pursuing radical transformation of their economy, society, and foreign policy. The Abraham Accords, a major achievement of Trump’s presidency, was an inflection point.

The monarchies now cared about return on investment from their allies, which included Pakistan. Unfortunately for them, both the economic and geopolitical returns in the recent past were in the red.

China also began to develop a more nuanced and jaded view of Pakistan and what its elites could offer.

The beginning of the Khan government started things off on the wrong foot, with Army Chief Bajwa having to visit Beijing to smooth things over.

But trouble would have brewed regardless of who ruled Islamabad, primarily because Pakistan’s elites were pursuing policies that would neither satisfy Chinese expectations nor minimise risks to Chinese investments in the country. Payments owed to the Chinese got stuck, projects stalled, visas were not approved, and the security situation deteriorated sharply.

The road ahead

The ongoing political and economic crisis must be viewed within the context of this history.

With the country’s ruling class currently engaged in scorched-earth warfare, all four of Pakistan’s historical patrons are recalibrating their policy towards Islamabad.

This is not only because Pakistan has fallen short of the expectations these countries have had over the years, but also because they have more important strategic challenges that they must contend with. As a result, they are not interested in spending an inordinate amount of time or resources in dealing with Pakistan.

Today’s increasingly multipolar world demands a different set of strategies from Pakistan. This is especially true because Pakistan’s traditional guarantors are preoccupied with a different set of challenges, and they increasingly believe that Pakistan does not offer much to them as a force multiplier — both geopolitically and economically.

This does not need be the case, because Pakistan has immense latent capabilities to be a valuable partner for its key strategic partners. For one, Pakistan’s defence capabilities, including its nuclear prowess, offers the Saudis a buffer to backstop its security concerns. Then there is the potential to be part of a diversified global supply chain as the world seeks to move away from China. Finally, to China, Pakistan offers access to a deep sea port if Gwadar finally reaches its potential.

Harnessing these capabilities, however, requires the country’s ruling class to first internalise that the world has changed – it will no longer rescue the Sick Man of South Asia simply because it is too big to fail.

Once elites recognise that the days of extracting geopolitical rents are over, the country can begin the process of rebuilding its value proposition to the world.

Header illustration: Iconic Bestiary/