The war between Iran on one side and the US and Israel on the other has implications for the global economy. While the narrative on negotiations and their nature has been highly divergent between the one communicated by Iranian officials and that trumpeted by US President Donald Trump, one thing they both acknowledge is Pakistan’s facilitation of whatever diplomacy is still happening between Washington and Tehran.

However Pakistan is not undertaking the facilitation of negotiations purely as an act of international statecraft, but rather as a nation with a vested interest in avoiding more of the economic fallout from the continuation of hostilities in the Gulf. According to a report by the New York Times, Islamabad is heavily dependent on hydrocarbons, including shipments for 85% of its crude oil, and according to a report by Al Jazeera nearly all of its liquefied natural gas (LNG) originating from the Gulf region.

With the sudden scarcity and inability to secure supplies of these fuels that drive its already strained economy, Pakistan has had to adopt austerity measures such as shutting educational institutions for weeks, and moving many government services to working online only.

In addition, geographical features such as its long border with Iran, which can directly affect it both in terms of refugee flow as was the case at the time of the US occupation and war in Afghanistan after 9/11, or if the hostilities with the US and Israel spill over into nuclear weapon use, in which case nuclear fallout will most certainly be a factor.

Apart from these practical considerations, Islamabad is also heavily dependent on performing its role as a go-between of sorts between major players who are traditionally seen as being in opposite camps, including the Sunni countries such as Saudi Arabia - with which it also has a mutual defence pact - Shia Iran and China, as well as the US.

This status of being a go-between has served Pakistan well as it has received financial aid, military hardware, and diplomatic support from all of these countries at crucial times, which has in turn directly contributed to its national survival and state interests.

Traditionally international statecraft is associated with countries that have global influence and a robust economy that can fund said influence, a description that doesn’t match Pakistan. According to a report by Mint, Islamabad has received 24 separate bailout packages from the International Monetary Fund (IMF) between 1958 and 2024.

Paradoxically, the ability to court so many masters and allies as an indispensable client state is exactly what has ensured Pakistan’s survival despite its plethora of national security challenges and economic hardships through the decades following independence from the UK in 1947.

However, courting so many opposing parties while maintaining its identity as a staunchly Islamic country, has led to some contradictions - or worse - something close to Orwellian “double-think” in its foreign policy circles.

While not an official position, Pakistan’s polity and society have a deeply antagonistic view of Israel and it is one of the most antisemitic countries in the world. Radical elements with no direct sway on the use of its nuclear arsenal, but some bearing on its political landscape are also quick to declare it a nuclear umbrella for the ummah - an Arabic term used for the global Islamic collective - positioning it against Israel’s alleged nuclear capabilities.

This narrative is highly inflammatory to Western nations including the US which has been a traditional ally of Israel and has been instrumental in its survival by providing Tel-Aviv funding and access to cutting edge military technologies.

Another irony given Pakistan's usual position on Israel and the US is Islamabad’s ties to, and participation in, flagship programmes of China, which is arguably the only real rival to the US in terms of military power and economic might in the 21st century. An example of this 'playing both sides' approach is perhaps exemplified by its air force depending on both the US-origin Lockheed Martin F16 and the Chinese-origin Chengdu J-10, both of which Islamabad used in limited conflicts with India in February 2019 and May 2025.

China meanwhile has more recently held the upper hand vis-a-vis Pakistan relations as the senior partner in developing the JF-17 fighter jet, which Pakistan co-produced with Beijing and is using to bolster squadron numbers in less critical roles.

Beijing is also on the verge of delivering the first of eight diesel-electric submarines in 2026, specifically built for the Pakistan Navy. Pakistan also reportedly operates several Chinese radar and air defence systems, including the HQ9/P which is roughly analogous to the US MIM-104 Patriot air defence system.

While never fully stopped or withheld though, the US has reviewed every US foreign military sales package to Pakistan since Washington started to take note of its support for, and ties to Islamist terrorists - allegations that Islamabad has denied. This includes sustainment supplies for its F-16s.

China, however, is now said to be mulling a $12bn defence package for Pakistan which would include 40 fifth generation J-35A fighter jets, KJ-500 Airborne Warning And Command Systems (AWACS) aircraft as well as HQ-19 air defence systems, which will likely upgrade Pakistan’s air power and air defence capabilities. This could even deliver an edge against India which has still not made any concrete attempts to procure a fifth generation stealth fighter to outpace China’s ability to equip Pakistan.

China too, as the world’s largest importer of hydrocarbons, depends on steady supplies to power its industrial base upon which global supply chains and industries in turn rely. To this end, the ability of vessels carrying these fuels to pass through the Strait of Hormuz shapes not only their availability but also their price for China.

Yet Iranian attacks on cargo ships, US bases and the territories of allied hydrocarbon producers, coupled with the US naval blockade of Iranian ports, place China’s very fuel supplies in jeopardy.

And, while there are reports that some ships claiming to be Chinese owned or bound for China have successfully transited the Strait of Hormuz and have not been targeted by Iranian forces, the vulnerability and lack of a reliable long term structure makes these arrangements unsustainable.

Because of this, the desire for a return to normalcy in the Gulf region and the Strait of Hormuz means the facilitation of negotiations by Pakistan, and resolution of the conflict between Iran and the US, is also of vital interest to Beijing. And of any nation in the region, Pakistan is best suited as Beijing's go-between and messenger at the negotiating table. 

Added to this is the further complication that Pakistan has a mutual defence pact with Saudi Arabia - signed in September 2025 - which has clauses similar to Article V of the North Atlantic Treaty (NATO) under which an attack against one signatory is to be considered an attack against the other, and thus requires both signatories to commit forces to defending their treaty ally. Riyadh repeatedly came under attack from Iran through the first six weeks of war.

This, as has been reported by Al Jazeera, saw Pakistan deploy military aircraft and personnel under its treaty obligations. In the meantime though, while Iran has sought guarantees from Pakistan that it will not act against Tehran, the very nature of the mutual defence pact may not give Islamabad much choice; a potential outcome already drawing comparisons to how European nations were forced into the First World War 112 years ago as a result of similar defence obligations at the time.