WHEN the incoming government takes office after the February 8 elections, it will be confronted with a tangle of foreign policy challenges, many of which are a legacy of intricate issues that require adept management and strategic finesse.

However, the immediate task facing the new administration would be to harness key international partnerships to propel the country towards economic stabilisation.

At the point of transition, the country grapples with severe economic headwinds, manifested in soaring inflation, dwindling foreign exchange reserves and a substantial fiscal deficit.

This precarious situation has ushered in a reliance on the International Monetary Fund (IMF), underscoring the country’s urgent need for robust international backing. Securing this support necessitates not only financial aid, but also assistance in forging a new arrangement with the Fund, a testament to the complexities of the economic landscape the new administration would inherit.

Navigating this intricate crisis requires a concerted effort to fortify traditional alliances and rejuvenate key international ties, with a special emphasis on the relationship with the United States.

Incoming administration’s foreign policy challenges will be underscored by need for economic stabilisation, which cannot be achieved without help from key players, such as Beijing and Washington

In managing Pakistan’s economic quandary effectively, the government’s success will not only chart the course for the nation’s economic resurgence, but also sculpt its regional clout and stature on the global stage.

“Economic weakness shrinks foreign policy choices. Of late, the balance of payment issues obliged our leadership to repeatedly request rich friendly countries for help,” says former Foreign Secretary Aizaz Chaudhry.

Caught between two giants

As such, the government’s foremost challenge is to navigate the intensifying US-China rivalry and regional dynamics with a pragmatic, yet astute approach, balancing immediate economic imperatives with long-term strategic interests.

Pakistan’s dilemma in the new great power competition is to work with both rivals (US and China), each setting unstated yet critical redlines that impact relations with the other.

Abdul Basit, who has served as Pakistan’s envoy in Germany and India, says, “Messaging on China–US competition should be nuanced. The claim that we aren’t part of any camp politics is hardly seen as credible. We should rather be emphasising that we would do what serves our national interest well.”

Revitalising Pakistan’s relationship with Washington will, therefore, be a critical undertaking. Historically, the US-Pakistan dynamic has been characterised by its transactional nature and complexity, shaped by the ebb and flow of geopolitical shifts. Now, as the global focus realigns with the US countering China’s influence and strengthening its ties with India, Pakistan faces the critical task of redefining its engagement strategy with Washington.

The December 2023 visit of Army Chief Gen Asim Munir to the US laid a foundational pathway for the future direction of this bilateral relationship. This visit, which came at a pivotal moment, established a consensus between the Biden administration and Pakistan on key areas of cooperation, particularly in security and regional stability.

The new government, therefore, inherits a mantle that requires both the continuation and expansion of this dialogue, especially in areas of security cooperation and intelligence sharing. This cooperation is essential, not just for the bilateral relationship but for broader regional stability, including counter-terrorism efforts.

Another cornerstone of this evolving relationship is economic cooperation and support, especially given Pakistan’s current economic crisis. Securing Washington’s backing for a new IMF programme is essential.

This support extends beyond financial assistance; it signifies an investment in regional security and prosperity. This is particularly pertinent considering Pakistan’s strategic geopolitical stance and its role in the region.

“Pakistan’s need for economic assistance and military equipment is still there but its ability to leverage its geographic location to secure aid from the US has diminished after the US withdrawal from Afghanistan,” says Husain Haqqani, a former Pakistani ambassador, who is currently a scholar at Washington DC’s Hudson Institute and the Anwar Gargash Diplomatic Academy in Abu Dhabi.

Islamabad is expected to continue advocating the Kashmir issue diplomatically to avoid further escalation. Balancing domestic concerns with the potential benefits of a less confrontational relationship with India will be crucial

“The volume of investment and trade between the US and Pakistan is relatively small for economic ties to be the basis of a partnership anywhere near what it used to be,” he further added.

Furthermore, it would be imperative for the new government to reaffirm Pakistan’s commitment to peace in South Asia, while maintaining a strong emphasis on opposing the polarisation of regional politics. The government should advocate for a balanced role of the US in the region, one that acknowledges and respects the security concerns of all regional players, Pakistan included.

The Afghan refugee crisis presents a humanitarian challenge that further intertwines the interests of Pakistan and US.

The repatriation of Afghan refugees and the expedited processing of those bound for the US and other Western countries remain crucial issues. Addressing this crisis effectively calls for collaborative efforts that consider the humanitarian implications and the potential impact on regional stability.

The facilitation of an India-Pakistan engagement remains a critical area where US support can be pivotal. US involvement in facilitating constructive dialogue can unlock significant economic potential through trade and connectivity, benefiting the entire region.

First visit to Beijing

Meanwhile, there is no denying that Pakistan has a longstanding and time-tested relationship with China, which is now underpinned not just by military cooperation, but also by the China-Pakistan Economic Corridor (CPEC), and that it needs to be expanded further, but at the same time it will have to be harmonised with need for sustaining a functional relationship with the United States.

Recently, China-Pakistan relations have faced challenges including security concerns for Chinese personnel in Pakistan, financial issues in CPEC projects, policy ambiguity, and Beijing’s unmet expectations under CPEC, all contributing to a slowdown in both CPEC progress and overall bilateral ties.

The new administration would have to address these issues for strengthening political and economic ties with China. It’s customary for the new prime minister to make China their first international visit, ideally within three months of taking office.

Messaging on China-US competition should be nuanced. The claim that we aren’t part of any camp is hardly seen as credible. We should rather be emphasising that we w ould do what serves our national interest Abdul Basit, former ambassador

This visit should focus on rejuvenating CPEC and enticing Chinese investment into Special Economic Zones (SEZs). Regionally, the new government must work with Beijing to mitigate Islamabad-Kabul tensions, besides addressing the ‘terrorist sanctuaries’ irritant in Pak-Iran relations.

Former ambassador to China Masood Khalid, concurs with this approach, saying, “We should solidify our relations with China.” He also believes that Pakistan needs to work with “China and Russia for stability in Afghanistan.”

India in the equation

In relations with India, the incoming government is expected to focus on diplomatic engagement, prioritising economic stability over political tensions. The government is likely to open doors for regional trade and investment with India. This may involve backchannel diplomacy and dialogue at various levels, aiming to address critical issues like the Kashmir dispute, while avoiding escalatory actions.

The Kashmir issue remains a significant point of contention. Islamabad is expected to continue advocating for this issue diplomatically to avoid further escalation.

Balancing domestic concerns about Indian-held Kashmir with the potential benefits of a less confrontational relationship with India will be crucial. Reviving dialogue and confidence-building measures with New Delhi, adhering to ceasefire agreements, and exploring economic cooperation could reduce tensions and lay the groundwork for constructive engagement.

Ambassador Basit favours a cautious approach on India. “Instead of getting impatient and directly engaging the new government in India, Pakistan should start by Track-II diplomacy to figure out Delhi’s strategic intent on Jammu and Kashmir and get an idea about its thinking on stalemate in ties. If Pakistan goes back to structured dialogue, its position on Kashmir would be undermined. Pakistan should have clear read lines about ties with India,” he maintained

Looking towards Middle East

Besides, the major relationships, ties with Arab states, a redefining relationship with Iran and managing the affairs with Taliban-led Afghanistan would also consume a lot of foreign policy bandwidth of the new government.

For the new government, engaging with the Arab world should be more than a diplomatic formality. It should be a strategic priority, not only for the economic benefits this relationship brings but also for the potential it holds in fostering regional peace and stability.

The Gulf nations, especially the United Arab Emirates (UAE) the Kingdom of Saudi Arabia (KSA), and Qatar have emerged as pivotal stakeholders in Pakistan’s economic landscape. Their financial support and investment have been instrumental in bolstering Pakistan’s economy.

In acknowledgment of this, the new government should aim to fast-track the sale of state-owned enterprises under the Special Investment Facilitation Council (SIFC) umbrella to strategic partners in these countries. This move will not only provide a much-needed boost to Pakistan’s economy but also deepen the economic ties between these countries.

Furthermore, it’s crucial to note the evolving geopolitical landscape in which Abu Dhabi and Riyadh are advocating for a paradigm shift in South Asian politics. They are encouraging Pakistan to explore avenues for normalisation with India, urging a move away from military standoffs and a step back from conflict in general. The post-election period, both in Pakistan and India, would present a unique opportunity for the Gulf leadership to play a decisive role in advancing Islamabad - Delhi engagement.

The recent tit-for-tat strikes by Iran and Pakistan against alleged terrorist havens in each other’s territory have precipitated an unprecedented escalation in tensions. This surge in hostility has disrupted the traditionally maintained veneer of amicability between the two countries, a relationship characterised by deep-seated mistrust dating back to the 1980s. Fortunately, intensive diplomatic efforts, significantly aided by Turkey, managed to mitigate the immediate fallout.

However, the long-term ramifications on bilateral relations cannot be ignored. In this altered landscape and geo-political environment not so conducive for Pak-Iran relationship, the new government would face the critical task of renewing it.

Given the extensive shared border, rife not only with militant factions of various affiliations but also criminal syndicates, coupled with the insurgency in Balochistan and Iran’s status as a major LNG supplier, the significance of this relationship for Pakistan is undeniable. It’s a diplomatic tightrope that Pakistan cannot afford to neglect.

Another imminent challenge awaiting the new government on the Pakistan-Iran front involves potential legal action from Tehran. This stems from Pakistan’s inability to complete its section of the Iran-Pakistan gas line project within the agreed timeline, extending until February-March 2024. Tehran may initiate legal proceedings by invoking the penalty clause of the Gas Sales Purchase Agreement (GSPA) signed in 2009. Consequently, Pakistan could be liable for a substantial penalty, amounting to $18 billion.

Complexities of Kabul ties

In navigating the intricate terrain of Pakistan-Afghanistan relations, the new government is set to inherit a complex and sensitive dossier, traditionally steered by the military command. This foundational aspect of Pakistan’s Afghan policy is expected to persist.

However, the new administration will be confronted with political and public pressure to reassess the current policies surrounding the forced repatriation of Afghan refugees and the institution of a visa regime between the two countries. Responsive to these pressures, the government will likely introduce some adjustments, balancing humanitarian concerns with national security imperatives.

Moreover, the new government will face the challenge of addressing potential escalations in violence emanating from Afghanistan, particularly by the outlawed Tehreek-i-Taliban Pakistan (TTP). In such scenarios, the new administration may find itself compelled to adopt a more hardline stance on this issue. This approach, while decisive, will necessitate careful calibration to avoid exacerbating tensions further.

Domestic politics and internal stability are critical in shaping Pakistan’s foreign policy. The interplay between military and political leadership, coupled with economic management challenges, will affect the government’s ability to engage effectively internationally. How Pakistan handles its internal issues will directly impact its international image and thus, its ability to secure economic assistance and foster international cooperation.

The success of Pakistan’s foreign policy under the new government will hinge on its ability to balance economic and diplomatic objectives. The handling of relations with key countries like the US, China, and India, coupled with effective domestic governance, will be instrumental in defining Pakistan’s future both economically and on the world stage.

There has lately been a debate on the diminishing role of Foreign Office in foreign policy making and execution. Former foreign secretary Salman Bashir says, “The Foreign Office is front and centre in relations with the outside world, building consensus on national interests in so far as the world is concerned. It should continue to remain a consensus builder on strategic issues and in particular determining strategic direction.”

Published in Dawn, January 24th, 2024