Pakistan has successfully reached a trade agreement with the US. President Donald Trump, known for his tough negotiating style, had launched a tariff war soon after assuming office, applying pressure on multiple fronts.
Against this backdrop, Pakistan’s success in securing a deal stands out – especially after recent tensions with India, where President Trump played a key role in brokering a ceasefire between the two countries.
The ceasefire reportedly followed a high-profile dinner hosted by President Trump for COAS Field Marshal Syed Asim Munir at the White House. This marked a significant moment in Pak-US relations, elevating bilateral ties to a new level despite their historically erratic and transactional nature. Pakistan is now recalibrating its strategic posture with the US, even as it maintains deep-rooted strategic relations with China. The goal is to strike a careful balance where both partnerships can coexist.
The new phase in Pakistan-US strategic relations was ushered in with the announcement of a comprehensive trade deal. This agreement spans several key sectors, including investment, energy, minerals, hydrocarbons, IT and cryptocurrency. While Pakistan had hoped for a more favourable tariff rate of 15 per cent, it ultimately accepted a 19 per cent rate due to hard bargaining by the US. Still, the deal is viewed as a net positive, especially given its potential to unlock major investments, most notably in Pakistan’s oil reserves. President Trump even remarked, perhaps half in jest, that “who knows, Pakistan may be selling oil to India tomorrow.”
However, this newfound engagement with Washington carries geopolitical risks. Strengthening ties with the US may raise concerns in Beijing, which has long been Pakistan’s strategic ally. Any shift in balance requires careful diplomatic manoeuvring. Pakistan must fine-tune its foreign policy to maintain equilibrium between the two powers. This is no small feat; it requires sophisticated diplomacy and a clear understanding of both short-term gains and long-term implications.
Pakistan must also reassess US-India relations, especially within the broader context of the QUAD alliance. The current US administration appears intent on reshaping global partnerships to serve its own strategic and economic interests. Yet such a transactional approach may falter in a world where cultural nuance, historical ties and political diversity play crucial roles. Countries like Pakistan cannot afford to sacrifice long-term stability for short-term economic gains.
Indian leadership, in particular, has exhibited a distinctive approach to international diplomacy. As Pakistan navigates this complex terrain, it must factor in China’s enduring importance and the unpredictability of US foreign policy. Strategic realignment must be approached with caution, foresight and realism.
Finally, a robust civil institutional framework is essential to guide and support Pakistan’s diplomatic efforts. The country must ensure that foreign policy decisions are not derailed by internal power struggles or short-sighted manoeuvring. Strategic policymaking demands visionary leadership committed to national interest, not just power for its own sake. As Pakistan ventures forward in this new diplomatic chapter, it must tread carefully. The stakes are high and the balance between two superpowers is delicate.
The ultimate game of the world revolves around economics and economic power. The strategic relations also revolve around economic gains or losses, when calculated in the ultimate scheme of things. The US administration under Trump is, in fact, making decisions keeping in view their economic strategic interests. It is obvious from the social media posts of President Trump that new deals revolve around economic interests. Even the strategic relations with India and other US allies are at stake due to America's economic interests. The famous slogan of President Trump, ‘Make America Great Again’ (MAGA), is deciding the fate of the long-term strategic relations with allies like the EU and India as well.
Any investment from the US – or for that matter, China – should be welcomed, but not at the cost of Pakistan’s long-term economic interests or its relations with either superpower. This is where a crucial balance must be struck: defining and redefining our strategic economic interests and stakes while fostering strong relations with both countries.
There is no doubt that the US remains the dominant global power, but China is not far behind. It has effectively acquired superpower status, as evidenced by its growing rivalry with the US in nearly every sector – from trade deals to the race over semiconductors and artificial intelligence. In the ongoing tariff wars, China appears to have gained the upper hand, while the US has been compelled to offer concessions to secure its strategic objectives.
Pakistan is a country of immense potential and resilient people who deserve a better economic future. Our natural resources, whether in the form of minerals, oil or gas, must be explored and utilised for the benefit of our citizens. This should be the cornerstone of our strategic priorities. The country’s wealth in hydrocarbons and gold reserves must be leveraged to uplift the economy and improve the well-being of its people. To this end, a smart, people-centred policy must be crafted to ensure that the exploitation of these resources truly serves the national interest.
Foreign direct investment is essential for unlocking Pakistan’s economic potential. However, any deal involving natural resources must prioritise the long-term benefit of the people over short-term gains. As Pakistan develops strategic relationships with both the US and China, it must remain vigilant in protecting its natural wealth from being compromised.
The examples of Nigeria and other African countries serve as cautionary tales where natural resources were heavily exploited, often to the detriment of local populations. Pakistan must avoid making the same mistakes. Offering access to our natural resources without due regard for the people’s interests would be a grave misstep.
Yes, Pakistan needs investment to harness its vast reserves of minerals, oil and gas. But strategic ties with global powers should not come at the cost of resources that belong to the people. A comprehensive investment policy must be carefully restructured to safeguard the interests of Pakistan’s true stakeholders – its citizens.
There is no denying that Pakistan must continue to strengthen its strategic partnerships with both the US and China. A delicate balance can and should be maintained – one that positions Pakistan as a bridge, not a battleground, between the established and the emerging superpower.
Fortunately, Pakistan already enjoys cordial relations with both countries and is uniquely positioned to promote economic and strategic collaboration rather than confrontation. The leadership now needs to implement a smart, forward-thinking policy agenda that advances the national interest while fostering durable partnerships with both superpowers.
The writer is a former additional secretary and can be reached at: hassanbaig2009@gmail.com
