The PAKISTAN Story.

Previously posted on my Facebook Page.

New York Times: “Battered by Floods and Trapped in Debt, Pakistani Farmers Struggle to Survive.” / “A Strong Dollar Is Wreaking Havoc on Emerging Markets. A Debt Crisis Could Be Next.” The West easily blames climate change but for Pakistan’s farming population, 42 percent of the country’s labor force, the recent flooding is a natural disaster that happens all the time and destroys agricultural lands and livelihood. Which means, small farmers in sharecropping arrangements are further buried into debt with their landlords.

       And then comes a rampaging U.S. dollar on a mission. On its path, low-income countries (such as Pakistan), already struggling per Covid pandemic, are severely hit. The dollar’s strength is adding to their woes.

       Site of several ancient cultures, Pakistan is historically resilient. It is bordered by nations that could offer aid in trade. India to the east, Afghanistan to the west, Iran to the southwest, and China to the northeast. It is separated narrowly from Tajikistan by Afghanistan's Wakhan Corridor in the north, and also shares a maritime border with Oman.

       Pakistan has served as China's main bridge to the Islamic world, and also played an important role in bridging the communication gap between China and the West. The relations between Pakistan and China have been described by Pakistan's ambassador to China as "higher than the mountains, deeper than the oceans, stronger than steel, dearer than eyesight, sweeter than honey, and so on."

       However, the United States remains as Pakistan’s chief export trading partner, despite the fact that more than half Pakistan’s 220 million humanity consider the U.S. to be an enemy. China is the top importer. 🇵🇰🇵🇰🇵🇰

Pakistan's economy is expected to grow by only 2 percent next year from 2022’s 3.5 percent but current indications aren’t hopeful. The country faces a 12 percent unemployment rate and rising. And with a debt crisis surfacing as a result of the stronger dollar, expect bleakness some more.

       Islamabad’s external debt is feared to spike to $138.568 billion as interest rates soar. Manufacturing is Pakistan’s chief industry. With the surging U.S. dollar, domestic manufacturers hoping to sell goods overseas amid red-hot inflation are facing dark days.

       As expected, China looms as Pakistan’s possible lifesaver. Compared with America that is viewed negatively, 75 percent of Pakistanis have a positive outlook of China. In turn, an almost equal 73 percent Chinese are cool with Pakistan.

       Economic trade between Pakistan and China has been recently increasing, and a free trade agreement has been signed. Military and technological transactions continue to dominate the economic relationship between the two nations, and China has pledged to increase their investment in Pakistan's economy and infrastructure.

       As expected, Beijing and Islamabad’s economic agreements are sealed via China’s centerpiece project Belt and Road Initiative, especially with regards the China–Pakistan Economic Corridor. 🇵🇰🇵🇰🇵🇰

China comes to the rescue via BRI’s China–Pakistan Economic Corridor. CPEC will connect Pakistan with China and the Central Asian countries with highway connecting Kashgar to Khunjerab and Gwadar. Gwadar Port in southern Pakistan will serve as the trade nerve center for China, as most of its trade especially that of oil will be done through the port, which is operated by the China Overseas Port Holding Company, a state-owned company.

       Currently, 60 percent of China's oil must be transported by ship from the Persian Gulf to the only commercial port in China, Shanghai, a distance of more than 16,000 kilometers. The journey takes two to three months, during which time the ships are vulnerable to pirates, bad weather, political rivals and other risks. Using Gwadar Port instead would reduce the distance and possibly the cost.

       While China focuses on economics, the U.S. is consistent on politics—and Pakistan is no exception. Islamabad has been a major non-NATO ally of Washington since 2002. Yet after Pakistan's participation in the Afghan peace process and Taliban (re)takeover of Afghanistan in 2021, a sizeable number of U.S. policy makers are revisiting the United States relations with Pakistan. That could be vague though under President Biden.

       I don’t think Biden likes Pakistan, regardless of Islamabad’s positive push for a new geo-economic vision. Biden's hawkish foreign policy approach views Pakistan as a major hub of international terrorism and jihadism. And so it appears redefining U.S.-Pakistan relations isn’t going to be quite easy. Of course, White House obligatorily urged the world to help “underwater Pakistan.” 🇵🇰🇵🇰🇵🇰

Visuals: BBC. Medium. Unctad.