TWO recent developments offer compelling reasons for policymakers to prioritise the building of buffers for economic security. First, Pakistan has earned international goodwill by playing a proactive role in encouraging dialogue among parties engaged in the Gulf conflict. Second, the IMF has shown unusual flexibility by reaching a staff-level agreement without imposing additional conditions at this critical juncture. With no end in sight to the conflict, Pakistan must leverage this goodwill and policy space to derive tangible economic benefits. However, this mustn’t follow the well-trodden path of a rentier state, where geostrategic positioning is exchanged for short-term financial inflows. Instead, a strategy to build durable buffers against future shocks must be adopted. Four key pillars of economic security merit attention.

Strengthening foreign exchange resilience: This requires boosting non-debt-creating inflows, re-profiling short-term external liabilities and maintaining market-determined exchange and interest rates. The recent relocation of transshipment activities to Pakistani ports is an opportunity to be sustained through improving capacity, governance and operational efficiency of maritime institutions. Temporary waivers of financial instruments for exports to Iran and Central Asian Republics should be institutionalised to facilitate regional trade. Construction of the Iran-Pakistan pipeline should be initiated. Gwadar Port must be made fully operational and completion of the western route linking it to the Karakoram Highway prioritised.

Security for oil and gas, mining and Chinese companies and joint ventures is a sine qua non. Providing electricity and water to Gwadar residents and developing infrastructure in the mining districts of Balochistan and KP is necessary as is the development of districts along the western........

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