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A journey into the unknown?

Global politico-economic uncertainty is likely to persist until of course the ambiguity that separates what Trump the candidate had said and what Trump the president-elect has promised is replaced by firm policy formulations. What he said during his campaigning was in short a powerful appeal to mostly the bluecollar white working class American voters who felt that local job opportunities for them were shrinking because of globalization and also because of liberal immigration policies.

True enough, globalization had exported millions of bluecollar American jobs to foreign countries and a steady inflow of immigrants had out-waged them in the residual local job market. On the other hand, what the president-elect promised after victory had universal appeal not only for all Americans but also for the world at large.

As president, if Donald Trump tries to satisfy his voters he is likely to trigger a global trade war sparking off an international economic upheaval. He has hinted at suspending all trade and investment agreements with different countries. On the other hand, if he tries to do what he has promised, he is likely to face a terrible political backlash from the very voters who had sent him to the White House.

Pakistan is not likely to be affected on the economic front either way, at least in the initial stages, even if Trump kicks up a global trade war as Islamabad does not have any long-term trade and investment agreements with the US. America is our largest export market amounting to $3.5 billion last year out of which 83% were textile exports ($2.9 billion). Pakistan also enjoys the GSP package along with 129 countries. The GSP package allows the import of consumer goods not produced in the US. So, in all likelihood, our trade with the US would remain largely unaffected unless of course dollar weakens to a considerable extent making Pakistani textile products expensive for American buyers. But then one cannot rule out the possibility of Pakistan’s economy also getting a serious hit if President Trump actually tries to impose a big increase in the import duties across the board and also blocks the entry of Pakistani immigrants.

There is no way of knowing what Trump in the White House would mean to Pakistan as he is a totally unknown entity in this country. Pakistani diplomats or for that matter the rich part of Pakistani Diaspora in the US which generously contributes normally to both the presidential contestants every four years would have had no interaction with this real estate tycoon known more as a social celebrity rather than a man worth their attention for lobbying in the politico-economic interest of Pakistan.

But Rawalpindi including our establishment has had very warm relationship with the Republican Party all through the last 70 years; through CENTO and SEATO for over two decades and then by playing the role of ‘free world’s frontline state’ in the first and second Afghan wars. The transactional nature of these associations had benefited Pakistan immensely in monetary terms and also in the regional political hierarchical contest.

As the Cold War heated up, a 1954 security agreement prompted the United States to provide nearly $2.5 billion in economic aid and $700 million in military aid to Pakistan. Indeed, Nixon, Reagan, the senior Bush and his son were known to have been staunch supporters of our establishment.

Of course, despite his hostility towards India, President Nixon could not stop New Delhi from forcibly dismembering Pakistan in 1971. But his administration is believed to have successfully warned India against casting an evil eye against the residual Pakistan because Nixon was beholden to President General Yahya Khan for the ‘help’ he had extended to him and his Secretary of State Kissinger to mend fences with China.

Similarly, President Reagan was beholden to President General Ziaul Haq for the assistance he had extended to the US in the break-up of the Soviet Union. The US funnelled nearly $5.3 billion to Pakistan during the Reagan administration (1981-1989).

And President GW Bush was a tight buddy of President General Musharraf for the help he had extended to the US in ousting Osama Bin Laden from Afghanistan and bringing to an end a fundamentalist regime of Taliban in Kabul. During his two tenures, President GW Bush had turned on the spigot sending more than $15 billion in assistance to Pakistan.

The senior Bush-President HW Bush – punished Pakistan in 1990 by slapping it with sanctions under the Pressler amendment for crossing the nuclear redline. But that was just an after- thought as his Republican predecessor President Reagan had looked the other way when Pakistan actually crossed it in 1988 because he had then needed General Zia’s help in taking care of the Soviet Union.

The senior President Bush, however, rescued Pakistan from the dire consequences of being declared a terrorist state by avoiding signing the relevant file which was on his desk while he was preparing to vacate the White House for President-elect Bill Clinton.

Of course, Bill and Hillary were in awe of Benazir Bhutto as she emerged on the world map as the first female Prime Minister of a Muslim majority country. This was when Bill was still some years from the US Presidency.

And by the time Bill defeated the senior Bush the establishment in Pakistan was looking for a scapegoat to pass the blame for terror activities in the Middle East including Egypt and it found one in the then Prime Minister Nawaz Sharif and ousted him blaming him first of corruption and then when this charge failed to hold in the superior court kicked him out blaming him for creating a constitutional crisis.

The establishment brought back Benazir Bhutto believing that her friendship with the Clintons would save us from the ignominy of being declared a terrorist state. They were proven correct as President Clinton filed the file in question without signing it.

As the search for Osama had continued even after the end of GW’s presidency and until late into Democratic President Obama’s first term the US administration approved another $7.5 billion of assistance for Pakistan , which tripled aid while committing to another five years of funding.

According to Newsweek (A Timeline of US aid to Pakistan – October 29, 2009) the five-year, $7.5 billion assistance package was passed by Congress in September (2009), and signed by President Obama in October (2009), ‘with stipulations explicitly prohibiting funds from being used for nuclear proliferation, to support terrorist groups, or to pay for attacks in neighbouring countries. It also puts a new emphasis on the bottom line, reserving the right to cut off aid if Pakistan fails to crack down on militants. Those restrictions have opened a rift between the military and the civilian government in Pakistan, which maintain an uneasy relationship following nearly a decade of military rule under Musharraf. Military leaders worry they are being sidelined by the increased US emphasis on development and accountability, claiming the bill threatens Pakistan’s sovereignty. But supporters of the bill say the restrictions are no more stringent than previous ones, and accuse Pakistani military leaders of manufacturing a crisis to undermine the civilian government.

And as expected, the Democratic regime of Barack Hussain Obama spent the next 10 years in re-tilting back to India, a process which his predecessor had already begun compelled by America’s growing concern about the rising China. The US administration kept on asking us to do more. It has also withheld most of the aid pledged in the five-year Kerry-Lugar-Bremen aid bill of $7.5 billion and refused to sell us 8 F-16s on concessional terms.

Also, there are a number of joint Obama-Modi statements that have criticised Pakistan for allegedly providing sanctuary to ‘good’ terrorists and also for not punishing those that caused the Mumbai massacre. The two seem to be taking a similar position on the Uri incident.

During the Cold War, India was largely in the USSR camp; therefore we were wooed by the Americans and designated as the most allied ally until we served their interests of fighting their war in Afghanistan against the Soviet Union and helping them remove this super power from the world map. During the second Afghan war we were wooed as a non-Nato ally but as soon as Osama was caught and killed by the US Seals in Abbottabad, the US warmth towards Pakistan had started cooling off.

But now the scenario seems reversed. India is opposed to China, a power whose rise Washington wants to stop while Pakistan has gone completely in to the camp of this rising power. And with the launch of the One Road, One Belt project which includes the China Pakistan Economic Corridor (CPEC) we seem to have been completely sucked into the side that Washington opposes in the region.

India appears to have already finalised a stratagem to counter the self-perceived threats to its sovereignty and integrity emanating from CPEC. Indian Prime Minister Narendra Modi has openly declared to isolate Pakistan and begun doing it by withdrawing from the scheduled Islamabad SAARC summit along with Bangladesh, Afghanistan, Bhutan and Sri Lanka. New Delhi is also lobbying the US Senate and Congress to get Pakistan declared as a terrorist state. And it has bought off some highly influential Republicans to its side on this issue.

This then is the political scene concerning Pakistan that awaits President Trump’s tenure in the White House that starts on January 20, 2017. The question is, do we have the wisdom and sagacity to read what is yet to be written and come up with strategies to meet the challenges of this unknown?

M. Ziauddin, "A journey into the unknown?," Business Recorder. 2016-11-16.
Keywords: Political science , International economy , Textile exports , Political corruption , Terrorist state , Military leadership , Globalization , Egypt , Pakistan , India , America , Bangladesh , Afghanistan , Bhutan , Sri Lanka , CPEC , SEATO