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Riaz Riazuddin //DAWN: April 11, 2025
WITH one stroke of his pen, a day after April Fool’s Day, Trump left the entire world bewildered at his tariff policy. He made the entire secretariat of the World Trade Organisation redundant, on the one hand, and all other countries engage in technical exercises with regard to the impact of his new tariffs on their economies, on the other.
The proponents of free trade (as if it really existed before Donald Trump’s order) are now trying to find new ammunition to attack Trump’s tariff plan. New phrases had been coined much before Trump assumed his second presidency. A popular phrase is ‘the transactional nature of his approach to dealing with international geopolitical relations’ (as if pre-Trump relations were based on ‘benevolence’!). While, as an economist, I am a proponent of free trade, I must admit that I am having trouble understanding the doomsday nature of predictions about the consequences of Trump’s tariffs in the US and the rest of the world. More on this later.
In writing the above, I run the risk of being labelled a proponent of Trump’s economic policies. I don’t want to make disclaimers such as are now common in the writings of many persons of science and knowledge who when agreeing with one point of Trump, start with a paragraph dissociating themselves with Trump’s utterings or actions.
For example, scientist Richard Dawkins recently wrote: “In my opinion Donald Trump is a loathsome individual, utterly unfit to be president, but his statement that ‘sex is determined at conception and is based on the size of the gamete that the resulting individual will produce’ is accurate in every particular, perhaps the only true statement he ever made.” When Trump and his vice president gave a dressing down to Volodymyr Zelensky in the Oval Office, the best analysis came from Jawed Naqvi in this paper: “The point we may have missed was Trump’s sound advice to Zelensky showing him the door: ‘You are gambling with World War III.’ It’s hard to remember an American president confessing to an ally he had been arming in a brutal war to be wary of the conflict turning into a nuclear war.”
Have we missed something in the Trump order? From my reading of the fact sheet released by the White House on April 2, 2025, it looked like an invitation to all affected countries to negotiate bilaterally with the US to move in the direction of pre-Trump free trade to the extent acceptable to him. Commentators have stated that the tariff numbers in the order are based on an allegedly erroneous formula. But what actually matters is that almost all countries have imposed higher tariffs on American goods compared to what the US has imposed on theirs. If tariffs are bad, why are these much higher in all other countries?
All countries other than the US suddenly seem to have become champions of free trade. If so, they all can and should reduce their tariffs. If not, then it means that their actions are not consistent with what they propose to champion. It is almost impossible to find fault with the principle ‘treat us like we treat you’. Trump has left the door open for free trade (relative to what it will be if no country negotiates with the US to seek concessions by somewhat lowering their tariffs) in his order. Retaliation is not a good option for any country, at least, for one like ours, that is always at the mercy of other countries. China has retaliated; it is not like us and is already a superpower and well on its way to dominating the world.
Trump’s order was an invitation to negotiate; that’s probably why Trump tweeted that China got it wrong by retaliating. Only time will tell who was right or wrong. Whichever way the tariffs have been crafted in Trump’s order, they induce uncertainty regarding future levels of the actual tariff, except baseline tariff which is 10 per cent for all countries. The formula for the level of additional tariff will be debated in negotiation. The correct level imposed by a country should be clearly known by that country’s officials. If that is lower than what Trump’s order imposed, the order has the flexibility to reduce it in future. But this process will take months, if not years, to complete. Until that process is kick-started and ends, uncertainty over America’s tariff policy will continue. This will be bad for the US and the world economy. It seems that an international recession, including in the US, is likely to occur soon. Strangely, when this uncertainty is pointing towards greater certainty about a US trade policy-induced recession, interest rate cuts by the Fed are likely to come soon, notwithstanding the Fed chair Jerome Powell’s recent talk about maintaining interest rates under heightened uncertainty. Trump seems to have visualised a recession much earlier and hence is demanding rate cuts notwithstanding the Fed’s autonomy.
The international media’s ‘doomsday’ reaction is entertaining. The Economist blurted out that Trump’s “mindless tariffs will cause economic havoc”. The Wall Street Journal chided: “Blowing up the world trading system has consequences that the president isn’t advertising.” The Financial Times warned: “Trump takes world to brink of full-blown trade war.” But why is Trump risking a recession in his own country with tariffs? It is because he wants to transfer resources from US consumers to producers and his government (through tariff revenues). This is consistent with what he was campaigning before he won the trust of the majority of Americans. One has to admire the tenacity of his actions, consistent with his words, and the speed with which he is moving to deliver his agenda. No matter how loathsome he might be to Dawkins and others in the US and abroad, Trump is convinced that he will restore manufacturing supremacy in America. He does not care if prices of cars rise in his country and admits this with impunity. People like me wonder when did the US actually lose its manufacturing prowess!
The writer is former deputy governor of the State Bank of Pakistan.
rriazuddin@gmail.com
Published in Dawn, April 11th, 2025
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Aasim Sajjad Akhtar Published April 11, 2025
THERE is a new(ish) game in town and it is called the scramble for ‘critical’ minerals. In a world dominated by microchips and digital gadgets, and in which capitalism is greening itself through the so-called energy transition, minerals like lithium, silicon and gallium are more coveted than ever. The desire to control critical minerals is increasingly at the heart of geopolitical conflict.
In large parts of the post-colonial world, natural resource endowment has been a curse for local populations rather than a blessing. Most of sub-Saharan Africa has been pillaged for its resources, while in Pakistan, Reko Diq and Saindak offer examples of how rich-resource regions and local populations never benefit from mineral riches. As per the evolving geostrategic logics of the global order, our militarised ruling class is priming itself to preside over a new round of mineral extraction in peripheries like Balochistan, KP and Gilgit-Baltistan.
While hosting a galaxy of global investors at a high-profile conference in Islamabad earlier this week, the prime minister insisted that critical mineral exploration offered Pakistan a shortcut out of its perennial debt trap. In parallel, the new US secretary of state Mark Rubio emphasised in a phone call to his Pakistani counterpart Ishaq Dar that Pak-US relations could improve if Islamabad grants Washington access to Pakistan’s deposits of critical minerals.
While officialdom here never needs legal cover for resource grabs at the behest of imperialism, it is worth noting that amendments to the KP Mines and Materials Act have rather suddenly been proposed in a hush-hush manner to pave the way for a ‘development’ miracle that suits global capital and local contractors alike.
For context, in 2023 the US Department of Energy published a Critical Minerals list, including the ‘electric 18’ minerals that Washington believes will be at the heart of the struggle for control over the global economy in decades to come. While the entire world is up in arms about the Trump administration’s tariff wars, especially against China, bear in mind that Joe Biden had already launched a chip war against China in 2022. Washington imposed stringent limits on the exports of any material to China, including silicon, used in the design and production of chips, which today are the essential intermediate goods in virtually all everyday consumption items, including mobile phones and cars.
Crucially, AI and advanced weapons systems are also reliant on cutting-edge chip technology — and the reaction of Big Tech and Western governments to the emergence of China’s DeepSeek confirms the high-stakes nature of technology wars today and in our putatively collective future.
Then there is the massive growth of industries like electric cars, as well as renewable energy sources in general, particularly solar. This translates into a huge demand for batteries, solar panels and other related implements, requiring huge quantities of critical minerals.
It is in this context that Pakistan’s current rulers are hedging its bets on a new wave of resource grabs; whereas until recently our fossil fuel-dominated economy revolved around oil, gas and coal, today it is all about critical minerals. Pakistan has never had huge deposits of oil and gas, but the establishment and its lackeys have always generated rents by playing off Pakistan’s geostrategic location.
This has not changed; the Gulf kingdoms, China and the US continue to grapple for influence within our ruling class. What has changed — or at least this is what the current regime believes — is that Pakistan now has significant enough deposits of critical minerals to be a big economic player in its own right.
But this would require Pakistan to have a strategy to use its minerals to industrialise, rather than just sell them off to the highest bidder. It is also telling that mineral extraction is hardly beneficial for local ecologies, no matter how one pitches the energy transition. But then again, Pakistan’s rulers have never been shy to trade in contradictions — as the ‘Green Pakistan’ corporate farming initiative, which is premised on more canal-building on the Indus river, confirms.
And then of course there is the question of what the critical minerals game will mean for the Baloch and other peoples who have only ever suffered brutalisation due to the geopolitical struggles that have played out on their lands. Beyond Balochistan, the current wave of violence in KP and the increasingly brazen ecocide in the mountainous highlands of GB have a lot to do with the race for critical minerals.
Bounty hunters are at it again. And the people whose rights and resources everyone is after are still proverbial sacrificial lambs.
The writer teaches at Quaid-i-Azam University, Islamabad.
Published in Dawn, April 11th, 2025
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DAWN EDITORIAL: 11 April 2025
THE problems of Balochistan are “political and must be resolved through political means”.
This view, espoused by PML-N supremo Nawaz Sharif during a recent meeting with National Party chief and former Balochistan chief minister Dr Abdul Malik Baloch in Lahore, is shared by many in Pakistan who wish to see a peaceful and just resolution to the troubled province’s crises. And coming from the leader of a party which currently heads the federal government, while also representing Pakistan’s politically most powerful province, makes the statement more relevant.
Some observe — and not without reason — that the civilian leadership has little actual say in the state’s Balochistan policy. That is why it is even more important for politicians to assert themselves and speak up at this critical time in favour of a political solution for Balochistan.
The elder Sharif also reportedly said that he would speak to the prime minister as well as “other relevant authorities” to help resolve the Balochistan imbroglio. The fact is that it is actually the ‘other authorities’, particularly those in Rawalpindi, that need to be convinced by the political elite that the troubled province’s issues cannot be resolved militarily alone, and that without meaningful political engagement the insurgency cannot be defeated.
The fact that Mr Nawaz Sharif has become involved is also relevant as he was on good political terms with former Balochistan chief minister Sardar Ataullah Mengal, whose son Akhtar Mengal is currently camped outside Quetta in protest, calling for the release of political prisoners. Though the establishment may have the upper hand in the current set-up, Mr Sharif can use his influence to persuade it to let the politicians take the lead in resolving Balochistan’s conundrum. In fact, all mainstream parties must unite over this existential matter and initiate a process of reconciliation and dialogue in the province.
Dr Malik Baloch’s efforts must also be encouraged: unless the administration engages with credible politicians such as the NP leader, Mr Mengal and other moderate nationalists, the last remaining link between those in the province that believe in the constitutional process and the state will eventually break. This would give extremist elements and separatists a fillip, spelling immense trouble for the federation.
The window for a peaceful settlement to the Balochistan problem may close soon. The state needs to show magnanimity and vision. It can start by releasing all political prisoners and removing obstacles in the way of political activity in the province. Terrorists must be dealt with firmly. But engaging in political activity cannot be equated with terrorism. These CBMs can pave the way for a dialogue on ensuring Balochistan’s constitutional and economic rights, and ushering in representative political rule. The clock is ticking.
Published in Dawn, April 11th, 2025
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DAWN EDITORIAL: 11 April, 2025
BRIGHT young Pakistanis face an uncertain future in the US. The Trump administration, not content with merely terrorising foreign students with visa revocations and deportations for expressing criticism of Israel and its genocidal campaign in Palestine, has also taken an axe to academic exchange and scholarship programmes that had for ages made America an aspirational higher education destination for the Pakistani intelligentsia. According to recent reports, the United States Educational Foundation in Pakistan has formally shut down the 15-year-old Global Undergraduate Exchange Programme for Pakistan. The future of its Fulbright Programme is also in doubt, owing to an extended funding freeze imposed by the new administration in February. Students already in America on Fulbright scholarships have not been receiving their stipends owing to the same funding ‘pause’, which has likely made it difficult, if not impossible, for many to continue living and studying in that country. They will find themselves in limbo if Washington decides to pull the plug.
It is, of course, up to the US government to spend its money however it sees fit. It would have been better, obviously, if it allowed foreign students already enrolled in American universities to complete their education without placing an unanticipated financial burden on them. But such decency seems to be in short supply in these troubled times. Exceptional Pakistani students hoping to study abroad should not lose heart, though. There are many excellent universities in other countries where students can still pursue their academic goals while contributing positively to their host countries and institutions. Many of them offer generous scholarships to Pakistani students. It is also hoped that other countries will fill the void being created by the Trump administration. Young Pakistanis have repeatedly proven that they possess some of the brightest minds in the world. Inviting them to study will nurture a lasting relationship with Pakistan’s future generations and shape their worldview in positive directions.
Published in Dawn, April 11th, 2025
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