he recent military conflict between Israel and Iran not only destabilised an already fragile Middle East but also posed a grave threat to the global peace and economic security. The surprise attack by Israel on the Iranian nuclear facilities violated international law and the foundational principles of the United Nations Charter. This act of aggression, and subsequent attacks, ignored the authority of the UN Security Council and blatantly undermined the nuclear non-proliferation treaty (NPT) to which Iran is a signatory.

The Iranian retaliation, in the wake of precision bombing of its nuclear sites by the United States raised fears of a full-scale war. The ceasefire eventually announced by President Donald J Trump came after a global outcry.

The damage had already been done, with global oil prices spiking and investor confidence shaky. The Strait of Hormuz, a vital artery for nearly 20 percent of the world’s oil trade, became a geopolitical flashpoint, leading to volatility in commodity markets and threatening the already vulnerable global economy.

The economic aftershocks of the Israel-Iran conflict resonated worldwide. They especially affected countries like Pakistan, whose economic stability is already under pressure. Pakistan’s geopolitical location, historical alliances and active diplomatic role placed it in a sensitive position during the conflict. The government of Pakistan adopted a balanced and principled diplomatic approach, urging restraint and calling for peaceful resolution through the United Nations.

The crisis came soon after Pakistan had concluded its own conflict with India, which had further strained the country’s fiscal and security apparatus. The recent war with India not only tested Pakistan’s military preparedness but also disrupted trade, displaced populations in border areas and required substantial emergency spending, which put further pressure on the fiscal situation of the state.

The economic challenges confronting Pakistan today are as complex as they are stark and severe. The country faces high commodity prices and an escalating cost of living; a depreciating currency; stagnant industrial growth; and ballooning debt repayments. Foreign exchange reserves have stabilised somewhat due to........

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