United States godfathering Israel

Lately, the United States blocked a United Nations Security Council resolution that would have recognized a Palestinian state. Twelve members of the Security Council had voted in favor of the resolution, while two countries – the UK and Switzerland – abstained. The United States vetoed it.

The Palestinian Authority President, Mahmoud Abbas, sharply criticized the US veto, saying in a statement that it was unfair, immoral, and unjustified, and defies the will of the international community, which strongly supports the State of Palestine obtaining full membership in the United Nations.

Israel’s Foreign Minister Israel Katz praised the US for vetoing what he called a shameful proposal.

US State Department deputy spokesperson Vedant Patel had announced earlier that the US would vote against the Security Council resolution, saying that the US has been very clear, consistently, that premature actions in New York, even with the best intentions, will not achieve statehood for the Palestinian people, referring to the headquarters of the United Nations.

He also noted there was no unanimity as to whether the Palestinians met the criteria for membership as a state in the UN, saying the US believes future statehood should be dependent on negotiations between Israel and representatives of the Palestinians.

“The most expeditious path towards statehood for the Palestinian people is through direct negotiations between Israel and the Palestinian Authority with the support of the United States and other partners who share this goal,” Patel said.

Palestinian attempts for recognition as a full member state began in 2011. They are currently a non-member observer state, a status that was granted in November 2012.

At the time, UN Ambassador of the Palestinian Territories Riyad Mansour called the step a historic moment, adding that he hoped the Security Council will elevate itself to implanting the global consensus on the two-state solution by admitting the state of Palestine for full membership.

Israel’s UN Ambassador Gilad Erdan condemned Friday’s move as consideration of a Palestinian terror state.

“This won’t be a regular state. It will be a Palestine-Nazi state, an entity that achieved statehood despite being committed to terror and Israel’s annihilation,” Erdan added.

The Saudi Ministry of Foreign Affairs has expressed disappointment over the UN Security Council's failure to pass a draft resolution that would have granted full UN membership to the State of Palestine.

The ministry said this decision contributes to the ongoing challenges faced by the region, particularly by allowing the continuation of Israeli occupation forces' actions without repercussions.

The ministry emphasized that the obstruction of Palestine's full membership in the UN hinders peace efforts and allows violations of the international law to persist.

Saudi Arabia reiterated its call for the international community to take decisive actions to stop attacks on civilians in the Gaza Strip and to support the Palestinian right to self-determination and statehood. This state, according to Saudi Arabia, should be established within the 1967 borders with East Jerusalem as its capital, aligning with the parameters set forth by the Arab Peace Initiative and other relevant international resolutions.

 

Israel-Iran encounters and US military strategy

The US military's success in helping Israel stop a recent massive wave of Iranian missiles and drones might suggest Washington is well prepared militarily for whatever comes next as Iran and Israel move from shadow warfare to direct confrontation.

Current and former US officials say US forces are not positioned for a major, sustained Middle East conflict and the Pentagon may have to revisit assumptions about military needs in the region if the crisis deepens.

"I don't think we have all the forces that we would want to support Israel if there was a direct war between them and Iran," said Michael Mulroy, a former deputy assistant secretary of defense for the Middle East under the Trump administration.

Though Tehran has indicated it had no plans to retaliate for an apparent Israeli strike on Friday, the tit-for-tat attacks have raised fears of an unpredictable regional war that the United States has sought to prevent.

In the months since an attack by Hamas militants on Israel triggered a war in Gaza that has ignited unrest throughout the Middle East. The United States has rushed thousands of US service members to a region that had seen a steadily declining US presence over years.

Many of those new US troops are on warships and aircraft that move in and out of the region, and are only temporarily deployed. That US strategy to rely on surge forces could be tested now Iran and Israel have broken the taboo of open military strikes against each other.

"What it means for the US military is that I think we have to revisit this idea of what are the necessary, sustainable military capabilities that we have to maintain in the region," said Joseph Votel, a retired four star Army general who led US troops in the Middle East.

Votel and other former officials said the US military's success in downing Iran's drones and missiles last Saturday was presumably aided by detailed US intelligence that allowed the Pentagon to anticipate the timing and targets of Iran's attack.

"I think the bigger concern is our ability to be responsive over a sustained period of time," Votel said.

US officials say Iran does not appear to want an all-out war with Israel, and Tehran has played down Friday's strike. Still, experts warn the situation is unpredictable, particularly as long as the Israel-Hamas conflict rages.

US Army General Michael "Erik" Kurilla, the current head of Central Command, told lawmakers last month that he had requested more troops than the Pentagon had sent to his region, which President Joe Biden's administration has said is a lower priority than the challenge from China.

In written testimony to the House Armed Services Committee, Kurilla said a dangerous shortfall in US intelligence assets, targeting expertise and linguists contributes to gaps and seams in our ability to detect and disrupt plots, increasing freedom of movement for violent extremist organizations.

Although Kurilla's comments appeared more focused on Afghanistan, some intelligence shortfalls have already affected US strategy since the start of the war in Gaza.

For example, a lack of detail about Houthi weapons stockpiles before the Iran-backed group started attacking commercial shipping in the Red Sea has made it hard to determine the effect of months of strikes on the group's arsenal of missiles and drones, said officials.

Still, sending more US troops to the Middle East and bolstering intelligence assets longer-term could prove difficult, officials say.

"Troops are spread around Europe and those that aren't are going through overdue maintenance cycles," one US official said, speaking on condition of anonymity.

"And Asia is supposed to be the focus."

Another official said it was still unclear whether the US military was prepared to pull forces from Asia or Europe, despite the increase in tensions.

Prior to October, the last time the United States surged thousands of troops into the Middle East was under former President Donald Trump, during a series of escalatory actions that culminated in the US killing of Iran's top general and a retaliatory missile attack by Tehran on a US base in Iraq.

The first US official noted that the surge of troops in 2019 and 2020 was possible because, unlike today, Washington did not have to dedicate so many personnel and resources to Europe, a new reality following Russia's 2022 invasion of Ukraine.

Mulroy said the United States should strengthen its position in the Middle East without abandoning its China-first focus.

 

 

Western media: Bias against Palestinians

A series of studies have been published in recent weeks analyzing coverage of the war in Gaza, and the results reveal an overwhelming bias against Palestinians.

In the first six weeks of the war, the New York Times, Washington Post, and Los Angeles Times used the terms "slaughter" and "massacre" 60 times more frequently in reference to Israelis than Palestinians, despite Palestinian deaths outnumbering those of Israelis by an order of magnitude.

CNN, MSNBC, and Fox News mentioned Israeli deaths four times as often as Palestinians during roughly the same time frame.

And on the four major Sunday morning TV talk shows, Israeli guests outnumbered Palestinians 10 to 1.

In the words of Mehdi Hasan — the former MSNBC journalist whose show was canceled after he committed the unpardonable sin of asking tough questions of a senior Israeli government official — "What else do you call that other than the deliberate dehumanization of the Palestinian people?"

Need to check Israeli attempts

The Iran-Israel shadow war has very much come out into the open. Tel Aviv had been targeting Tehran’s assets for over a decade, particularly in Syria, taking advantage of the chaos engendered by that country’s civil war. A number of Iranian scientists, especially those associated with the Islamic Republic’s nuclear program, had been assassinated within Iran in hits widely considered to have been orchestrated by Israel.

While the Iranians are known for their strategic patience, and for playing the long game, the April 01 Israeli strike on an Iranian diplomatic facility in Damascus, in which a number of senior Iranian generals were killed, had crossed a red line. There was tremendous pressure on Iran from within to reply to this Israeli transgression, and the ayatollah and his generals had to respond without triggering a major regional war.

Tehran’s response came in the shape of the April 13 assault on Israel, a barrage that was short on destructiveness, yet scored a major strategic and PR victory for Iran. The suspected Israeli strikes targeting Iranian facilities in Isfahan early on Friday are the latest move on this dangerous chessboard.

While Tel Aviv has officially kept mum about the Isfahan misadventure — Israel rarely owns up to subterfuge outside of its borders — some politicians in the Zionist state have celebrated the attacks, while American media, quoting sources, have said this is Israel’s handiwork. The Iranians themselves appear to be downplaying the event, and an airbase and nuclear facilities in the area seem to be safe.

Once again, the clamour for de-escalation has been echoing from global capitals. Surely a wider war is in no one’s interest — except perhaps for the extremists in Israel — but true de-escalation means Israel must start behaving like a normal state, not a rogue nation that threatens the entire region, as well as the forsaken Palestinians captive in the occupied territories.

The UN secretary general has said “one miscalculation … one mistake, could lead to the unthinkable”. But this is perhaps just what Benjamin Netanyahu and the cabal of zealots in the unruly coalition that backs him may want. After all, Israel has been facing global opprobrium for its butchery in Gaza, while Netanyahu is facing significant domestic opposition for his handling of the debacle.

Thus, a war with Iran may be a useful distraction to shift the focus from Palestine, and rally Israel’s Western friends behind it to protect the Middle East’s ‘only democracy’ against Tehran.

Suffice to say, any scenario pitting the Israeli-Western collective against Iran and its ‘axis of resistance’ allies will result in an explosion in the Middle East, causing oil prices to skyrocket, and global trade to be upended. To avoid this, Washington, London and Brussels need to check Israel’s destabilizing behaviour.

Courtesy: Dawn

Warmongers approve US$95 billion package

The US House of Representatives on Saturday with broad bipartisan support passed a US$95 billion legislative package providing security assistance to Ukraine, Israel and Taiwan, over bitter objections from Republican hardliners, reports Reuters.

Passage of the long-awaited legislation was closely watched by US defense contractors, who are in line for huge contracts to supply equipment for Ukraine and other US partners.

The legislation now proceeds to the Democratic majority Senate, which passed a similar measure more than two months ago. US leaders from Democratic President Joe Biden to top Senate Republican Mitch McConnell had been urging embattled Republican House Speaker Mike Johnson to bring it up for a vote.

The Senate is set to begin considering the House-passed bill on Tuesday, with some preliminary votes that afternoon. Final passage was expected sometime next week, which would clear the way for Biden to sign it into law.

The bills provide U$60.84 billion to address the conflict in Ukraine, including US$23 billion to replenish US weapons, stocks and facilities; US$26 billion for Israel, including US$9.1 billion for humanitarian needs, and US$8.12 billion for the Indo-Pacific, including Taiwan

Ukrainian President Volodymyr Zelenskiy expressed his thanks, saying US lawmakers moved to keep "history on the right track."

"The vital US aid bill passed today by the House will keep the war from expanding, save thousands and thousands of lives, and help both of our nations to become stronger," Zelenskiy said on X.

The Biden administration is already finalizing its next assistance package for Ukraine so it can announce the new tranche of aid soon after the bill becomes law in order to meet Ukraine’s urgent battlefield needs, a White House official said.

Biden, who had urged Congress since last year to approve the additional aid to Ukraine, said in a statement, "It comes at a moment of grave urgency, with Israel facing unprecedented attacks from Iran and Ukraine under continued bombardment from Russia."

The vote on passage of the Ukraine funding was 311-112. Significantly, 112 Republicans opposed the legislation, with only 101 in support.

"Mike Johnson is a lame duck ... he's done," far-right Republican Representative Marjorie Taylor Greene told reporters afterward.

Marjorie has been a leading opponent of helping Ukraine in its war against Russia and has taken steps that threaten to remove Johnson from office over this issue. Greene stopped short of doing so on Saturday.

During the vote, several lawmakers waved small Ukrainian flags as it became clear that element of the package was headed to passage. Johnson warned lawmakers that was a "violation of decorum."

The House's actions during a rare Saturday session put on display some cracks in what generally is solid support for Israel within Congress.

Recent months have seen progressive Democrats express anger with Israel's government and its conduct of the war in Gaza.

Saturday's vote, in which the Israel aid was passed 366-58, had 37 Democrats and 21 Republicans in opposition.

Johnson this week chose to ignore ouster threats by hardline members of his fractious 218-213 majority and push forward the measure that includes Ukraine funding as it struggles to fight off a two-year Russian invasion.

The unusual four-bill package also includes a measure that includes a threat to ban the Chinese-owned social media app TikTok and the potential transfer of seized Russian assets to Ukraine.

Some hardline Republicans voicing strong opposition to further Ukraine aid argued the United States can ill afford it given its rising $34 trillion national debt. They have repeatedly raised the threat of ousting Johnson, who became speaker in October after his predecessor, Kevin McCarthy, was ousted by party hardliners.

"It's not the perfect legislation, it's not the legislation that we would write if Republicans were in charge of both the House, the Senate, and the White House," Johnson told reporters on Friday. "This is the best possible product that we can get under these circumstances to take care of these really important obligations."

Representative Bob Good, chair of the hardline House Freedom Caucus, told reporters on Friday that the bills represent a "slide down into the abyss of greater fiscal crisis and America-last policies that reflect Biden and (Democratic Senate Majority Leader Chuck) Schumer and (House Democratic leader Hakeem) Jeffries, and don't reflect the American people."

But Republican presidential candidate Donald Trump, who carries huge influence in the party, on April 12 voiced support for Johnson and in a Thursday social media post said Ukraine's survival is important for the US.

United States targets Chinese steel, maritime and logistics sectors

President United States, Joe Biden has called for tripling the existing tariff rate on Chinese steel and aluminium, just as the US Trade Representative’s (USTR) office announced the launch of yet another Section 301 investigation into China’s maritime, logistics, and shipbuilding sectors.

Biden told the USTR to raise the tariff on steel and aluminium imports from China – already under Trump-era duties – from 7.5% to 22.5%, according to a statement by the White House.

He also sent senior envoys to pressure Mexico to prevent Chinese steel and aluminium from transferring through Mexico to evade tariffs.

Biden’s move was made public just ahead of his visit to the headquarters of the United Steelworkers Union in Pittsburgh as part of his re-election campaign in the swing state of Pennsylvania.

The new investigation under Section 301 of the Trade Act of 1974 was launched after reviewing a “serious and concerning” petition by five national labour unions accusing China of using “unfair, non-market policies and practices” to “dominate the maritime, logistics, and shipbuilding sectors”, the USTR office said.

“The allegations reflect what we have already seen across other sectors, where China utilizes a wide range of non-market policies and practices to undermine fair competition and dominate the market, both in China and globally,” US trade representative Katherine Tai was quoted as saying.

“I pledge to undertake a full and thorough investigation into the unions’ concerns.”

A Section 301 investigation examines whether a foreign government’s acts, policies, or practices are unreasonable or discriminatory, and whether they burden or restrict US commerce.

If the investigation determines foreign practices have unfairly affected US commerce, the USTR may take “appropriate and feasible action” to remedy the unfair practices, including imposing duties and other import restrictions such as fees.

The USTR was seeking public comments and would hold a public hearing in connection with the investigation, the statement said.

The USTR added that it had requested consultations with the Chinese government about the investigation.

The 137-page petition, along with hundreds of supporting documents, was presented to the USTR office on March 12.

The petition lists the Chinese government’s actions, including providing loans from state-owned banks, equity infusions and tax preferences as well as provisioning steel at below-market prices and issuing loans to support the construction of thousands of vessels in China for export.

It highlights some unfair practices by Beijing, including ordering Chinese companies to buy and use Chinese-built products, directing mergers, and blocking alliances with foreign companies.

The coalition of labour unions includes the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union; the International Association of Machinists and Aerospace Workers; the International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers and Helpers; the International Brotherhood of Electrical Workers; and the Maritime Trades Department.

The petition was also endorsed by two US senators, Democrats Tammy Baldwin of Wisconsin and Bob Casey of Pennsylvania.

During his administration from 2017 to 2021, former US president Donald Trump launched various Section 301 investigations into Chinese imports and imposed punitive tariffs, which triggered retaliation by China and began a trade war that continues today.

 

Pakistan Stock Exchange closes at highest level

At Pakistan Stock Exchange trading session during the week ended on April 19, 2024 remained erratic. However, concluded on a stronger note on the Friday with the benchmark index posted highest-ever closing at 70,909 points posting 0.85%WoW gain.

Overall, average trading volume was reported at 492.37 million shares, up 43.51%WoW, clocking in at 2.46 billion shares, as compared to 1.72 billion shares traded in the earlier week.

The volatility may be attributed to the general uncertainty surrounding over international crude prices, primarily due to the ongoing rifts in the Middle East, with the tensions largely emanating due to the scuffle between Iran and Israel. The key highlight of the week was the successful visit of the Saudi delegation to Pakistan, promising major investments in various sectors. Additionally, KSA’s acquisition of a 25% minority stake in the Reqo Diq Mining project for US$1.0 billion appears to be progressing well, with the deal anticipated to finalize soon.

With regards to FIPI flows, net foreign investments remained consistent throughout the outgoing week, culminating to US$33.86 million by Friday close.

Finally, authorities repaid the maturing US$1.0 billion Eurobond on April 12th, resulting in the SBP’s FX reserves to end the week at US$8.0 billion.

With regards to fuel price, Motor Gasoline and Diesel prices were raised, attributed to rising crude oil prices.

Other major news flows during the week included; 1) PIB sale falls short, yields dip on shorter maturities, 2) Pakistan claimed to complete gas pipeline project with Iran, 3) Wheat production target of 32.2 million tons set for the current season is at high risk due to rainfall, 4) Government does not anticipate any significant currency devaluation.

Sugar & Allied industries, Refinery, Synthetic & Rayon, Vanaspati & Allied Industries, Textile Weaving were amongst the top performing sectors, while laggards included Miscellaneous, Woolen, and Paper & Board.

Major net selling was recorded by Individuals (US$14.43 million) & Banks (US$10.97 million). Brokers absorbed most of the local selling with a net buy of US$1.23 million.

Top performing scrips of the week were: PSX, FABL, FATIMA, AKBL, NRL, while top laggards included: PTC, ISL, KTML, SEARL, and MUGHAL.

Going forward, market is expected to return its focus to negotiations with the IMF regarding The EFF program, upcoming monetary policy announcement, and the corporate results which are expected to be announced throughout the coming two weeks.

Despite the market reaching its new highest, the forward P/E continues to remain below 5.0x, which instills positivity regarding the market's fundamentals.