Shehbaz, Asim change regional calculus

From Laraib Zahra Once upon a time, far from Earth, beyond the reach of our skies, there existed a planet called the Worthlands. In the Worthlands, there was an equal proportion of humans and ghosts. Whenever a human was born, a little ghost was born by their side. These little ghosts were called Hounds. Every Hound possessed a superpower: it could know exactly what its human companion was thinking. The entire planet was ruled by three powerful ghosts, commonly known by humans and Hounds as the Great 3Gs. Each of the three had a separate kingdom. They were the Ghost of Guilt, the Ghost of Productivity, and the Ghost of Fear. The Ghost of Guilt was the eldest of the three. He controlled the capital of the Worthlands. He had his own Guilt Police and Guilt Pumps. Guilt was a magical liquid found inside these pumps. The Guilt Police, along with the Hounds, kept a constant check on the behaviour of the people in the capital. Their job was to make sure that nobody ever ran out of fuel—the fuel of guilt. Whenever a person was caught running out of guilt, the Hounds immediately reported them to the Guilt Police. They were then provided with more guilt fuel to make sure that nobody went “insane.” The biggest crime in the capital was the Rest Crime. As soon as a person became exhausted and decided to take some rest, the Hounds would begin fiercely whispering in their ears: “Strong people don’t stop.” They would tell them not to rest until they reached somewhere. But where exactly this “somewhere” was, nobody really knew. Sometimes, when a person was genuinely unable to work any further because of an overwhelming workload, the Hounds would call specialised therapists known as the Fear Feeders from the Kingdom of Failure for counselling—a kingdom I shall discuss in greater detail later. On the other hand, the entire north of the Worthlands was ruled by the second Great Ghost: the Ghost of Productivity. Unlike the Guilt Police, who were actually in charge of the capital, there was no such police force in the north. Instead, there was a ministry known as the Ministry of Merit. The humans there were never supposed to sit idle. Instead, they were expected to work harder and harder to make sure that they remained at the top of the list maintained by the Ministry of Merit. Every year, there was a grand ceremony known as the Annual Worth Ceremony. The humans who earned the highest number of merit points received a golden star carved with their names in the Worth Register of the Ministry of Merit. Every time a human refused to rest in order to increase their productivity, the Hounds would greet them by saying: “Congratulations! You have earned three merit points.” Humans were comparatively happier in the north than in the other two kingdoms because here, they were rewarded with golden stars bearing their names. The more golden stars a human had beside their name in the Worth Register, the more likely they were to become part of the Hounds—the most respected position in the Worthlands. After all, the Hounds had the superpower to read human minds, and they could even fly. Their slogan was: “You could be doing more.” To the south lay the third kingdom—the Kingdom of Failure, ruled by the Great Ghost of Fear. This kingdom was the most terrible of them all. The humans there were weak and diseased. Every second person was a victim of anaemia. They looked as though they had been starving for days, perhaps even weeks. On the contrary, the Great Ghost of Fear was the fattest of the three ghosts. The reason for this strange contrast was hidden in the Hounds. Unlike the Hounds in the north and the capital, the Hounds in the south had a distinct name. They were called Fear Feeders. The Fear Feeders had one duty: to sense fear-bearing thoughts in human minds and suck them out, because the Great Ghost of Fear fed on those thoughts. There were many kinds of fears that humans carried in that kingdom: The fear of not doing enough. The fear of getting left behind. The fear of failure. And many more. The Fear Feeders collected these thoughts and presented them to their master. The Great Ghost of Failure had one dish that was especially dear to him. It was his favourite dish of all: “What If” Spaghetti. “What If” Spaghetti was a special dish found in all three kingdoms, but it was particularly abundant in the Kingdom of Failure. The humans looked starved because they had to constantly produce fear in their minds so that they could feed it to the Fear Feeders. These fears were produced through a process called whispering, carried out by Hounds that were not themselves Fear Feeders. Then, one day, something unexpected happened. A few Hounds disappeared. Seven Hounds. Everyone in the Worthlands was deeply concerned about their sudden disappearance. The Guilt Police, along with other investigation departments, launched a search operation. But not even a single missing Hound was found. The humans whose Hounds were missing were arrested and questioned. The results of the investigation shocked everyone in the Worthlands. The Hounds could only exist if their humans obeyed them. This was something that neither the Hounds nor the humans had ever known before. The humans whose Hounds had disappeared were, surprisingly, close friends. During the investigation, they confessed that one day, they had decided to step back from their usual exhausting routines and take a break to rest their tired and ruptured nerves. All of a sudden, seven Hounds appeared and began whispering their usual slogans: “Strong people don’t stop.” “What if you get left behind?” And their most favourite: “You could be doing more.” The humans became lost in their thoughts once again and decided to give up on their plan to rest. But then, suddenly, a voice echoed through the room: “But

The effects of the defence agreement between Pakistan and Saudi Arabia were witnessed by the entire world during the recent US-Iran-Israel war. At the same time, there was continuous speculation about whether the scope of this defence agreement could be expanded in the coming days. For years, the defence of major Middle Eastern countries has largely depended on the United States. However, during the recent conflict, the US appeared unable to fully protect either these countries or even some of its own military bases in the region. When Iran attacked Saudi Arabia, Pakistan immediately issued a strong warning, stating that if Iran wanted to protect its own territorial integrity, it should avoid any aggression against Saudi Arabia; otherwise, Pakistan would honour its defence commitments. Soon afterwards, the world witnessed a different situation in areas where Pakistani forces were present. While attacks continued in various parts of the region, areas protected by Pakistani forces experienced a markedly different security environment. Against this backdrop, international newspapers began suggesting that the United States’ influence in the Middle East could be entering a period of decline. As the poet famously said: “Insha Ji, get up and leave now; What is the point of becoming attached to this city?” The peace talks between Iran and the United States, hosted by Pakistan and referred to as the “Islamabad Accord”, created further diplomatic momentum. Shortly after the first meeting, discussions surrounding the Pakistan-Saudi defence agreement began attracting global attention. Influenced by these developments, other countries in the region also started exploring the possibility of joining or cooperating with the defence arrangement. Pakistan is the world’s only nuclear-armed Muslim-majority country. Saudi Arabia is one of the world’s most influential oil-producing states and holds immense religious significance for Muslims worldwide. Türkiye, meanwhile, has established a strong reputation for its drone technology and non-nuclear missile capabilities. The combination of these three countries could have significant strategic consequences for the region. Their growing defence cooperation is unlikely to be viewed favourably by either the United States or Israel. Even before the reported expansion of the defence arrangement, statements from the United States and Israel indicated growing concern. The role of American military bases and radar systems located in several Muslim-majority countries has also come under greater scrutiny, particularly over their alleged role in supporting Israel during the conflict. One US think tank reportedly described the emerging regional landscape as involving two major blocs: a Sunni alliance and a Shia alliance, with Israel and the United States potentially prepared to confront both. Such assessments could be interpreted as an indication of changing strategic dynamics and a possible reduction in American and Israeli influence across parts of the region. As mentioned earlier, several other countries are reportedly watching the development of the Pakistan-Saudi defence partnership closely. Egypt is also said to have participated in preliminary discussions, and its potential inclusion in the future cannot be ruled out. If Egypt joins the arrangement, the strategic balance could become even more significant. Egypt controls the Suez Canal, one of the world’s most important maritime trade routes on which a substantial portion of global commerce depends. It also possesses one of the region’s strongest naval forces and a large fleet of military aircraft. Access to Egyptian territory and strategic waterways could therefore have major implications for the Middle East, Israel and Europe. With Pakistan, Saudi Arabia, Türkiye and potentially Egypt forming a broader strategic group, the combined military capabilities of these countries, supported by Saudi Arabia’s enormous energy resources and financial strength, could create a formidable regional bloc. This is one reason why the emerging defence arrangement is increasingly being compared with Article 5 of the NATO treaty. Under Article 5, an armed attack against one NATO member is considered an attack against all members, triggering a collective commitment to assist the country under attack. NATO invoked Article 5 for the first and only time in its history following the terrorist attacks against the United States on September 11, 2001. In the coming days, countries such as Egypt, Bangladesh, Kuwait and Jordan could potentially become part of broader defence cooperation, although their formal participation would depend on future diplomatic and strategic decisions. At present, Israel, the United States, India and Iran all appear to have concerns about the potential consequences of such an alliance. However, the coming months will reveal its actual structure, scope and strategic impact on the region.

For more than a decade, the global debate over critical minerals has focused almost entirely on mining and extraction. Western policymakers, multinational mining companies and international financial institutions have invested billions of dollars in securing mineral reserves across Africa and Latin America. From cobalt mines in the Democratic Republic of Congo to the Lithium Triangle of South America, the prevailing belief has been simple: control the mines and secure the future of the green energy transition. However, this overwhelming focus on extraction overlooks a fundamental reality of modern industrial power. In today’s world, strategic independence is not achieved simply by digging raw minerals out of the ground. True industrial strength lies in refining those raw materials into high-purity, battery-grade and industrial-grade minerals through advanced chemical processing. It is at this critical processing stage, often referred to as the “processing bottleneck,” that China has established an extraordinary and nearly unmatched global dominance. The Mining Illusion and China’s Refining Monopoly Understanding why Western efforts to reduce dependence on China continue to struggle requires recognising the crucial difference between mining and refining. Raw lithium extracted from Australian hard-rock mines or South American brine deposits cannot be used directly in electric vehicle batteries. It must first undergo complex chemical processing to produce lithium hydroxide or lithium carbonate with a purity of 99.9 percent. The same applies to rare earth elements, cobalt, nickel and graphite. Without refining, raw minerals have little value for advanced technology or defence industries. This is where China’s true strength becomes evident. While the country’s share of global mining production is relatively limited, it dominates global refining capacity. China currently refines about 35 percent of the world’s nickel, between 50 and 70 percent of global lithium and cobalt, and nearly 90 percent of all rare earth elements. It also controls virtually 100 percent of the global market for spherical graphite, a key material used in battery anodes. This creates a major strategic challenge for Western economies. Even if companies in the United States, Europe or Australia develop new mines, much of the extracted material still has to be shipped to China for chemical processing. As a result, many attempts to bypass China ultimately continue to strengthen its refining ecosystem. The Structural Foundation of China’s Success China’s refining dominance is neither accidental nor simply the result of low labour costs. It reflects more than three decades of consistent industrial planning and state-backed investment. During the 1990s and early 2000s, many Western economies shifted heavy industries overseas to reduce costs and meet stricter environmental regulations. At the same time, China recognised that chemical refining would become the foundation of future technological leadership. Through successive five-year development plans, Beijing invested heavily in large-scale refining facilities, specialised metallurgical universities and low-cost energy infrastructure. Decades of research enabled Chinese engineers to master technologies capable of refining even low-grade ores efficiently and at relatively low cost. China also accepted the significant environmental costs associated with refining. Processing rare earth minerals produces toxic waste, radioactive by-products and hazardous chemicals. While strict environmental regulations and public opposition have made large-scale refining projects difficult in North America and Europe, China accepted these environmental challenges as part of its long-term national strategy. Why the West Cannot Easily Replicate China’s Model Concern over potential Chinese export restrictions has encouraged the United States and its allies to invest in domestic refining infrastructure. However, matching China’s industrial ecosystem remains an enormous challenge. Several major obstacles stand in the way First, time. Building a modern refining facility in Europe or North America typically takes seven to twelve years because of environmental approvals and legal procedures. In China, similar projects can often be completed in less than two years. Second, cost. Chinese refineries benefit from economies of scale, low electricity prices and extensive government support. Western facilities face much higher labour, environmental and operational expenses. Without strong financial guarantees, private investors remain reluctant to finance projects that could later become uncompetitive if China lowers prices. Third, skilled manpower. Decades of industrial outsourcing have reduced the number of mining metallurgists and chemical engineers in many Western countries. Meanwhile, China continues to produce thousands of specialised engineers every year, maintaining a steady pipeline of technical expertise. Strategic and Geopolitical Consequences China’s refining advantage extends far beyond electric vehicles and consumer electronics. It has become a critical factor in global defence and national security. Modern military equipment—including guided missiles, radar systems, nuclear submarines and fifth-generation fighter aircraft such as the F-35—depends heavily on refined rare earth magnets and processed critical metals. In the event of a military crisis involving Taiwan or the South China Sea, China would not necessarily need to block access to global mines. Instead, it could simply restrict exports of refined minerals. Such a move could disrupt Western defence manufacturing within months, even if friendly nations continued producing raw mineral resources. The global competition over critical minerals, therefore, is no longer centred solely on who owns the mines. It increasingly depends on who controls the refining process—the stage where China has built its strongest and most strategically important advantage.

In the digital era, crime has drastically transformed. These days, planned disinformation operations, hate speech, deepfakes and misinformation spread more quickly than traditional crimes, eroding public confidence, escalating tensions within communities and, in severe situations, inciting actual bloodshed. Police must change to protect the information environment as well, since Pakistan’s digital footprint keeps growing. Acknowledging the evolving security environment, Regional Police Officer (RPO) Sohail Akhtar Sukhera has established a Cyber Patrolling Cell in District Jhang as a pioneer model for the Faisalabad Region. By keeping an eye on dangerous online content, spotting emerging digital risks, recording evidence and organising prompt responses through legal processes, the initiative represents a shift from reactive policing to intelligence-led prevention. The framework emphasises adherence to existing legal safeguards while providing clearly defined monitoring categories, reporting channels and escalation procedures. The significance of this initiative extends beyond the boundaries of the Faisalabad Region. It reflects a reality increasingly recognised by law enforcement agencies worldwide: the internet has become an operational domain of public safety. Within hours, a fake video, manipulated image or coordinated disinformation campaign can generate fear, inflame sectarian tensions, undermine institutional legitimacy or provoke violence. Preventing harm in both physical and digital environments has therefore become an essential responsibility of modern policing. Cyber patrolling has already been integrated into contemporary law enforcement in several countries. The European Union’s Digital Services Act requires major digital platforms to mitigate systemic risks arising from coordinated misinformation and illegal content, while Europol strengthens cross-border cyber intelligence. Singapore, through the Protection from Online Falsehoods and Manipulation Act (POFMA), combines legal intervention with public digital literacy campaigns to counter online deception. The United Arab Emirates employs AI-driven cybercrime teams and real-time threat intelligence to combat online extremism and hate speech. In South Asia, Kerala Police’s Cyberdome demonstrates how collaboration among law enforcement agencies, cyber security professionals and academic institutions can strengthen cyber threat intelligence, digital forensics, online fraud investigations and disinformation monitoring. By identifying rumours, verifying information and reducing public panic during emergencies, Cyberdome has emerged as one of the region’s leading cyber policing models. Against this international backdrop, the Cyber Patrolling Cell established by RPO Sohail Akhtar Sukhera represents an important step towards institutionalising digital policing in Pakistan. While still evolving, it demonstrates an understanding that policing must anticipate threats before they materialise rather than merely responding after damage has occurred. However, technology alone cannot counter disinformation. International experience demonstrates that successful cyber patrolling depends upon robust institutions, specialised expertise and public trust. Pakistan should therefore consider several complementary reforms. First, dedicated Digital Threat Intelligence Units should be established within police organisations, integrating cyber investigators, OSINT analysts, digital forensic experts and behavioural analysts capable of identifying coordinated online influence operations. Second, law enforcement agencies should invest in artificial intelligence-assisted monitoring systems capable of detecting bot networks, coordinated disinformation campaigns, multilingual hate speech and AI-generated deepfake content while ensuring meaningful human oversight over enforcement decisions. Third, closer institutional collaboration is essential. Provincial police, the Federal Investigation Agency (FIA), the Pakistan Telecommunication Authority (PTA), the National Cyber Crime Investigation Agency, universities, technology companies and civil society organisations should operate through an integrated digital information-sharing mechanism. Cyber threats rarely respect institutional or provincial boundaries. Fourth, specialised partnerships with universities and research institutions should support continuous officer training in cyber intelligence, digital forensics, artificial intelligence and data analytics. Institutions such as NUST, FAST, Information Technology University Lahore and other research centres possess expertise that can strengthen law enforcement capacity. Fifth, transparent oversight mechanisms are indispensable. Periodic public reporting, independent legal oversight and clearly defined operational protocols can ensure that cyber patrolling remains lawful, proportionate and fully consistent with constitutional guarantees relating to freedom of expression and privacy. Effective cyber policing should enhance democratic resilience rather than weaken it. Finally, equal attention should be given to digital literacy. Citizens who can verify information, recognise manipulated content, identify deepfakes and report online abuse become active participants in protecting the information ecosystem. Public resilience remains the strongest defence against organised deception. The strategic importance of the information domain has surpassed that of physical infrastructure. Just as police patrol streets to deter conventional crime, responsible cyber patrolling has become essential to protecting democratic institutions, social cohesion and national security. Digital policing has become a fundamental responsibility of contemporary law enforcement, and Pakistan can no longer afford to treat it as an optional function. The Cyber Patrolling Cell established under the leadership of RPO Faisalabad Sohail Akhtar Sukhera should be viewed not merely as a regional initiative but as a policy experiment capable of informing Pakistan’s broader digital policing strategy. Strengthened through advanced technology, specialised training, transparent oversight and interagency cooperation, it offers a practical road map for developing a nationally integrated cyber patrolling framework that safeguards both public security and democratic resilience in the digital age.

Development is the process of creating lasting improvements in the lives of people by addressing their genuine social, economic, and public needs and not merely constructing new infrastructure, completing projects, impressive photographs, or utilising the allocated public funds. In a true sense, the real measure of development is whether the real problem has been solved, and whether the interventions have created sustainable public value and an evident change in social or economic conditions of the society. A project should begin with a clearly defined problem and public need. Its vision, goals, activities, and measurable indicators should follow the problem. In professional project management practices, all these elements are recorded in the planning and design phase. In Pakistan, we have mastered the art of reporting these elements without achieving any meaningful results. Imagine a public park surrounded by a steel fence. Children and families using the park are visible from the road. If funds are available and privacy is the genuine concern, the executing agency can add steel sheets, plant trees, or use temporary screens. Each solution is inexpensive and retains the existing structure. However, if the focus is primarily on expenditure, the agency may remove the functioning fence and replace it with a new brick wall. This may have a longer life, but is not necessarily the most economical or appropriate solution. Considering Pakistan’s fragile economic outlook, many major development projects are financed through foreign loans. Such funds are eventually repaid, often with interest. Money spent on an unnecessary intervention is no longer available for genuine public need. This is a recurring weakness in Pakistan, where success is measured by the money spent, not by the effectiveness of the solution. This recalls Peter Drucker’s observation. “There is nothing so useless as doing efficiently that which should not be done at all.” The continued existence of infrastructure built during the Mughal and British periods is in contrast with contemporary projects, which deteriorate within years. This might be a romantic comparison, influenced by the fact that we see only the structures that survived, but durability and long-term public value are not central to our project culture. The same mindset is evident in urban beautification schemes. Imagine a local government installs a 15-foot-high statue. The project is indeed beautiful and will produce attractive photographs for official reports, but if the same statue is mounted on thoughtfully designed columns, the shaded seating can be utilised by daily wage workers who gather at bus stops, on footpaths, and in other public spaces because no designated facility is available. This is not an encroachment issue, but a planning failure. Planners and designers should use one intervention to achieve multiple objectives. Imagine a decades-old roundabout, with a working fountain surrounded by grass. During hot afternoons, labourers and children visit the site to cool themselves in the fountain’s spray. Officials might consider this behaviour undesirable and wish to block access. They can barricade it through small trees or shrubs, but the typical response will be to uproot the entire structure, construct a new fountain, and replace the grass with artificial green carpet. The public behaviour may reflect the unavailability of affordable recreational areas or public bathing facilities. Yet, the official solution destroys a functioning public asset, removes a natural green area, and spends substantial funds without addressing the underlying need. Needs assessment appears in project reports, but they are rarely conducted with sufficient depth. Imagine a posh housing society, where tubewells were eventually replaced by private borewells. Residents have spent a considerable amount to arrange their own water supply. Now, if any government agency has received funds for water distribution, they should spend it in areas where the people are still digging borewells or have no access to clean drinking water. However, again the typical response will be to spend millions in this posh area, where households have already arranged their own water supply. The fall of the water table is the real problem, which in this case will persist after spending millions. Pakistan has an extensive planning structure, which includes the federal and provincial bodies, planning departments in government organizations, consultants, and project management units. In 2025-26 alone, the National Economic Council approved the national development portfolio of 4.224 trillion. Such substantial expenditure should produce visible and lasting improvement in people live. The problem, therefore, is not insufficient funding, but how projects are identified, designed, approved, and evaluated. The same problem is visible in education, health, and administrative projects. Consider a basic health unit or education facility with a leaking roof. The available funds should be directed to fix the roof. However, funds are allocated to boundary wall, new signage, and in some cases, for an entirely new building. Similarly, for decade, government departments are trying to digitise their operations. For a quick solution, these departments procure specialised softwares, which has high licensing costs, and inadequate training mechanisms. After years of implementation, enforcement, and expenditure, the same departments revert to paper files or to a new software. The first step should be, to strengthen the capacity of all relevant staff in problem identification and root cause analysis. Every project initiation document should clearly identify the problem, public need, examine alternatives, and link the proposed intervention to public value. These elements should always be in quantifiable terms. Moreover, the project indicators should measure the extent to which the problem is solved and the post-completion evaluation should validate the visualized public benefits. Institutions move energetically, spend heavily, and report extensively, but bypass the original problem. Pakistan does not simply need more projects; it needs projects to solve problems; it needs interventions that respond to genuine needs, preserve what already works, and provide sustainable public value. The true measure should not be the amount spent but the resolution of the problem. Unless problem-solving becomes central to planning and evaluation, fund utilisation will continue to be mistaken for development and detour away from progress we seek. Writers  Dr. Sikandar Bilal Khattak  Academician with Research Interest in Sustainable Systems Can be

Pakistan’s debt problem has entered a new phase. The headline figure is alarming: total debt and liabilities reached Rs. 99.59 trillion by the end of fiscal year (FY) 2025-26. The deeper concern, however, lies in the composition of this debt, the burden of servicing it and the channels through which public borrowing now affects every productive sector of the economy. According to the latest State Bank of Pakistan data, total debt stood at Rs. 97.88 trillion. Gross government domestic debt reached Rs. 59.44 trillion, while external debt amounted to Rs. 36.20 trillion. Central government debt increased by 7.39% over the preceding year to Rs. 83.64 trillion. External debt and liabilities stood at US$138.85 billion. These numbers confirm the central argument developed in the a ten-part series published in these columns [‘Bankruptcy of ideas—X: Debt, Taxes & Democracy’, Minute Mirror, June 21, 2026]. Pakistan has not merely borrowed against its future. It has increasingly borrowed to service earlier borrowing, while failing to create sufficient productive capacity from the accumulated debt.   ‏The external debt-servicing profile for FY2026 makes this particularly clear. Pakistan serviced US$21.59 billion of external debt during the year. An extraordinary US$10.14 billion—nearly half of the annual amount—fell in the final quarter alone. Quarterly servicing was 2.63 times the amount paid in the preceding quarter, mainly because principal repayments jumped from US$2.70 billion in the third quarter to US$8.81 billion in the fourth. This concentration of repayments is as important as the overall debt stock. A country may carry a large debt if its economy generates sufficient revenue, exports and foreign exchange to service it. Pakistan’s difficulty is that debt obligations have expanded much faster than the productive and export capacities needed to meet them. The debt accumulated over decades cannot be attributed to one government or one fiscal year. Persistent fiscal deficits, a narrow and inequitable tax base, losses of state-owned enterprises, the energy-sector circular debt, excessive recurrent expenditure, exchange-rate depreciation and repeated balance-of-payments crises have all contributed to it. Borrowing became the preferred substitute for reform.  Governments borrowed because they could not tax influential sectors, restructure loss-making enterprises, reduce wasteful expenditure or build a competitive export economy. External lenders financed temporary stability, while domestic banks financed the fiscal deficit. Each arrangement postponed difficult decisions without removing the causes of the crisis. The Ministry of Finance reported public debt at 70.7% of GDP by June 2025. The ratio may improve when nominal GDP grows faster than debt, especially during periods of inflation, fiscal consolidation and lower interest rates. A declining debt-to-GDP ratio, however, does not necessarily mean that the debt burden has become harmless. Pakistan’s debt stock is still increasing. What has improved is the immediate cost of servicing parts of it. Total debt and liabilities servicing declined from Rs. 13.16 trillion in FY2025 to Rs. 11.97 trillion in FY2026. Interest payments on debt fell by more than 23%, from Rs. 9.47 trillion to Rs. 7.27 trillion, largely because lower policy rates reduced the cost of servicing domestic government debt. Interest payments on gross government domestic debt consequently fell from Rs. 8.08 trillion to Rs5.99 trillion. This is welcome relief. It should not be presented as the end of the debt crisis. Lower interest rates reduce the flow cost of debt; they do not extinguish the stock. Principal repayments on external debt and liabilities increased from Rs. 3.47 trillion to Rs. 4.47 trillion during FY2026. Pakistan therefore obtained relief on domestic interest payments while facing a substantially heavier external repayment burden. The distinction is between debt management and economic transformation. Pakistan may be moving from an acute debt-accumulation crisis towards a more manageable financing position. It has not escaped debtocracy—the system in which fiscal policy, taxation, banking, foreign relations and development priorities become subordinate to the requirements of borrowing and repayment. Debtocracy does not remain confined to the accounts of the Ministry of Finance. It is transmitted throughout the economy. The first channel is the banking system. Government securities offer banks sovereign backing, liquidity and attractive risk-adjusted returns. Lending to the government is easier than evaluating businesses, financing innovation or supporting small and medium enterprises. A large domestic borrowing requirement therefore creates continuous competition for available liquidity. The result is crowding out. The State obtains the funds it requires, banks earn relatively secure returns and the private sector bears the adjustment. Productive businesses face limited access to credit, higher risk premiums and shorter financing horizons. Smaller enterprises suffer the most because they cannot compete with the sovereign for bank liquidity. This creates a financial system that can remain profitable while the productive economy remains weak. Deposits are mobilised from citizens and businesses, channelled into government securities, and then used substantially to meet recurrent expenditure and service earlier debt. Banking expands without an equivalent expansion in productive capacity. The second channel operates through foreign exchange. External debt repayment creates demand for dollars. That demand places pressure on reserves and the current account. Any resulting exchange-rate depreciation increases the rupee value of external liabilities and raises the domestic price of imported fuel, machinery, raw materials and intermediate goods.  The chain is direct: External repayment creates foreign-exchange demand; reserve pressure increases exchange-rate sensitivity; depreciation generates imported inflation; and inflation raises working-capital requirements and production costs. Debt consequently becomes a corporate balance-sheet issue. An industrial enterprise may have no external loan, yet still bear the effects of sovereign external debt through a weaker rupee, costlier imports, higher energy prices and restricted access to domestic credit. Consumers ultimately pay through inflation, reduced employment and lower real incomes. The third channel is fiscal. Every rupee allocated to debt servicing is a rupee unavailable for education, health, water, climate resilience and productive infrastructure—unless the State raises additional revenue or borrows again. Pakistan then enters a circular arrangement: borrowing creates servicing obligations, servicing compresses development expenditure, weak development limits growth and revenue, and insufficient revenue necessitates further borrowing. This is why a primary surplus, though necessary, is not sufficient. It can stabilise debt dynamics, but