Impact of economic factors on Pakistan’s foreign policy

ByM Ali Siddiqi

writer who contributes to leading periodicals


August 29, 2022

Impact of economic factors

M Ali Siddiqi analyses a double-edged sword of Impact of economic factors

The impact of economic factors on Pakistan has become a classic case in the region whose foreign relations have been deeply impacted by economic considerations. This impact has been strongly felt during the last two decades that witnessed intense compromises Pakistani foreign policy makers had to undertake in order to take into consideration the economic factors that often outweighed foreign policy imperatives. This indeed is a sorry state of affairs that needs to be seriously thought about and adequate steps are to be taken to stem this rot. It is feared that if this trend continues then it is not inconceivable that the greater part of foreign policy priorities will be badly compromised. Apparently, such efforts are not seen to be taken and this aspect is indeed worrying. Since Pakistan seriously lacks any organised public opinion feedback therefore it becomes the responsibility of a small cadre of experts and media commentators to prepare the ground for a perceptible change in this state of affairs.

It must be kept in view that it is an acknowledged fact that fragility and weakness of economies compel states that receive financial help to pay heed to the preferences of the donor states and follow a foreign policy that is inherently in variance with the actual aspirations of its people. The economically viable powers invariably exploit the weakness of their client states and use them for carrying forward their strategic agenda. It is one of the stark realities of the international system that economically weak states have a lot to lose by obtaining financial assistance instead of making themselves economically strong. The overwhelming role economies play in modern nation states is increasing by the day and it has become a decisive factor in interstate relations. Keeping in view the crucial nature of this issue, the foreign policy considerations take profound cognisance of the state of economy while devising contours of foreign policies and such considerations are never lost sight of.

Pakistan at its inception inherited an extremely weak economic base as it got a paltry share of the economic assets of the subcontinent and had to virtually start from scratch. Many aspects of economic growth were inherently missing from the new country as it was rated as situated in the backwaters of British colonial territories. Right at the outset, its economic sources came under intense strain as it had to bear the burden of Muslim refugees coming over to their promised land from all over the subcontinent in one of the largest migration of people witnessed in history. It is widely acknowledged that economic depravity was at the basis of determining the foreign policy matters that were often contrary to the interests of the people of the country. It was noticed throughout that Pakistan’s foreign policy never came out of this complex state of affairs and virtually became a part and parcel of the policies of foreign policy makers.

The weak economic base of the country left it with no recourse but to solicit financial aid from its erstwhile colonial master, the UK and its replacement power broker in the region, the US. The matter assumed urgency as Pakistan had to defend its territorial integrity owing to the enmity of its larger neighbour who had not accepted the separate national status attained by Pakistan. The territorial dispute assumed serious proportions as Pakistan had to fight Kashmir war with India soon after its independence and the subsequent border tensions compelled it to allocate financial outlay to its armed forces that it could barely afford. The security paradigm thus adopted vied with economic considerations and the situation became even more complicated. These twin-considerations ultimately became the cornerstone of Pakistani foreign policy though it often runs contrary to the actual requirements of the country.

Keeping in view the adverse reality, Pakistan always framed its foreign policy to gain economic relief for its survival and prosperity of its people. It may be kept in mind that the economic assistance given by the US since 1950s came with strong strings attached to it compelling it to participate in extensive western-sponsored alliances despite the Russian opposition to them. Crucially, due to the economic reliance on the western world Pakistan was made to pursue a policy in tandem with western concerns comprising of encircling the Soviet Union that unfortunately neighboured Pakistan. That was the beginning of misplaced aims of foreign policy that have still not let Pakistan free of their shackles. Coupled with the misplaced strategic depth syndrome Pakistani foreign policy actually became entangled into a confusion that has not dissipated at all since many decades.

By 1965 Pakistan had experienced the uneven trajectory of relying on American aid as the war with India proved that America followed its own policy imperatives instead of backing Pakistan to the hilt. The consequence of being rendered helpless in an existential confrontation with India saw Pakistan tilting towards the Muslim world and Iran as it expected financial succour from there. PM Bhutto changed the dimension of foreign policy and repeatedly visited Iran and Gulf countries to obtain financial aid. The Muslim world particularly Libya and Saudi Arabia did provide monetary assistance to Pakistan and also helped in bank-rolling its nuclear programme. This kind of financial aid was frowned upon by the traditional Pakistani support base consisting of the western world that kept on objecting to Pakistan about it and it gradually became a source of conflict that still causes friction.

The excessive reliance on the Muslim world eventually distorted the contours of a balanced foreign policy as Pakistan became a pawn in the western quest to humble Soviet Union with active collaboration of Saudi Arabia. Once again the tangent of Pakistani foreign policy was determined by monetary assistance provided by Muslim monarchies and resulted in creating a situation that ran contrary to the genesis of the Pakistani polity. After September 2001 Pakistan’s foreign policy again veered towards the western world as it was now dictated to play the role of most-favoured nation while reversing its old policy of supporting Mujahidin in Afghan war and beginning to hunt them. The economic constraints playing effective role in determining the foreign policy came back with a vengeance pushing it into an unpredictable axis more harmful than proving beneficial. The general impression of the economically-controlled foreign policy of Pakistan was that of a weathercock following the dictates of the highest bidder. This is indeed an unfortunate situation that needs to be dispassionately reassessed.

Pakistan is blessed with tremendous strategic advantages but, in order to achieve temporary and shallow gains, successive regimes used this advantage so frequently that it lost its efficacy. Iran and India have resultantly devised new ways to end Pakistan’s monopoly of providing singular access to Central Asia. The tilt towards China is reminiscent of the earlier pursued foreign policies as China is also exploiting Pakistan’s economic weakness. Pakistan is now trying to balance this policy and it is quite clear that it has lost credibility, a fact that became apparent during the tough negotiations with the IMF. Pakistan’s foreign policy does not appear to be out of doldrums dictated by economic exigencies. It is therefore important that a policy of achieving economic stability is pursued as soon as possible to end reliance on foreign financial assistance with the ultimate aim of breaking away from formulating foreign policy designed by economic masters. TW


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