Daily Times

The word “geoeconomics” was first used in 1990 by American researcher Edward Luttwak to describe the expanding area of politics globally. Luttwak first used the word in an article a year after the Soviet Union’s disintegration, combining the logic of battle with economic plans.

However, keeping in view the South Asia’s case, Pakistan is physically set in a region historically troubled by political unrest. With Afghanistan and Iran on its western border and a tense relationship with India to its east, Pakistan must navigate tough terrain.

Also, the competition between the United States and China, Pakistan’s northern neighbor, is heating up. Ensuring internal stability, improving the economy, and promoting regional peace are critical to accomplishing targets for growth and navigating volatility. However, Pakistan has shifted from geopolitics to geoeconomics. Until now, the change in policies has been nothing more than nonproductive diplomacy.

A heartland’s geo-political significance indicates its importance in transnational affairs beyond its immediate region, particularly as an ally in the Superpowers competition. A state has a place in geoeconomics if its territorial boundaries and regions, infrastructures, or reserves strategic allow it to play a key role in the worldwide economy, such as an industrial center or a link in supply chains. It could also be a supply of energy or a transportation hub for industry. Islamabad is important in both geoeconomics and geopolitics.

Islamabad policy pundits did not safeguard the socioeconomic welfare of its growing population.

However, policymakers should consider whether they truly must pick among the two. or if it is really feasible to make such a decision. Is geopolitics the cause of Pakistan’s economic issues, and geographic economics the way out?

The reality is that Islamabad policy pundits did not safeguard the socioeconomic welfare of its growing population. Its governance approach prioritized the elite above the masses, security insurance over evolution, reliance over self-reliance, and status quo over advancement.

The structural system is currently causing more damage than the country’s economy. Islamabad might be capable of geoeconomics, but it has not yet met the qualifications. Geopolitics is only partially to blame. It is still vital to Pakistan’s foreign policy; however, the scope of its significance has shifted.

Pakistan has geopolitical prominence being located between Central Asia, South Asia, Tehran, and the Arab countries, as well as in the strategically important the shadow of Beijing and Russia. But geopolitics will only be beneficial if Islamabad is strong. For a volatile country, it is an asset and a risk. For example, when a major power loses, so does its ally, as Islamabad has in America’s wars.

American’s hostilities have never been different from Islamabad’s, and its policy approach has repeatedly failed. If the shift to geoeconomics means Islamabad will no longer be involved in such high-risk geopolitics, that is to be celebrated. America’s conflicts also fueled Islamabad ‘s own geostrategic objectives, which caused as much harm as US actions.

If Islamabad has halted this approach, that is a positive move. Geopolitics is still a directional element in the US-Islamabad nexus, but it now causes tension in the bigger picture of the US-Beijing rivalry. Islamabad is viewed as serving Beijing’s geopolitical interests. Islamabad must reach an agreement with Washington on geopolitical and security concerns to maintain engagement with the US, a key economic partner. Failure to do so will limit Pakistan’s geoeconomic role.

Even with Pakistan’s traditional allies, the Gulf states, economics now follows geopolitics as they maneuver between the America-Europe-Delhi nexus and Beijing’s geopolitical hold out. Geopolitics will also influence Islamabad’s nexus with them. Islamabad must rethink both geopolitics and geoeconomics.

The truth is that its true geoeconomic potential will not be realized until Kabul regime become stable, relations with Delhi develop and it becomes a center for networks and business with Central Asian counties. However, due to fundamental and structural economic vulnerabilities, corrupt leadership, weak governance, and a paucity of political insurance, Pakistan’s citizens are not fully prepared for geo-economic challenges.

Shift drastic will be difficult to achieve since elite concerns and solid economic programs are at balance. Since the independence, Pakistan’s weak economic planning have been managed to guard its elite-led system.

At the ending, those concerning exports, tariffs, taxes, and subsidies, were formulated with the intention of preventing the financial goals of the business or industrial elite from being surpassed, the social fabric supporting the feudal system from being undermined, and the exceptional resources directed toward the defense industry from coming into conflict.

The system requires updating. Without making structural reforms, Pakistan could be able to boost its economy on the margins and achieve a faster growth rate. However, if a growth rate has no effect on social indices, human security, or poverty, what good is it? It is improbable that a population with little access to medical care and schooling would be economically productive.

Pakistani government’s “poor outcomes in terms of social progress and increasing poverty” were highlighted by Martin Raiser the Bank’s regional senior vice president for South Asia, who also underlined the urgency of addressing the country’s “acute human capital crisis”. Pakistan cannot abandon geopolitics or ignore it.

Furthermore, geoeconomics will remain unattainable if the necessary reforms are not put into place. Pakistan will stay where it is, which is another possibility.

The writer is a PhD candidate at QAU and has worked at SDPI.