Trump still supplying arms to Israel

According to media reports, the US State Department has approved the sale of nearly US$3 billion worth of bombs, demolition kits and other weaponry to Israel. The weapons sales were notified to Congress on Friday afternoon on an emergency basis. 

That process sidestepped a long-standing practice of giving the chairs and ranking members of the House Foreign Affairs and Senate Foreign Relations Committees the opportunity to review the sale and ask for more information before making a formal notification to Congress.

The sales included 35,529 general-purpose bomb bodies for 2,000-pound bombs and 4,000 bunker-busting 2,000-pound bombs made by General Dynamics. While the Pentagon said that deliveries would begin in 2026, it also said “there is a possibility that a portion of this procurement will come from US stock which means immediate delivery for some of the weapons.

A second package, valued at US$675 million, consisted of five thousand 1,000-pound bombs and corresponding kits to help guide the “dumb” bombs. Delivery for this package was estimated to be in 2028. A third notification consisted of US$295 million worth of Caterpillar D9 bulldozers.

Friday’s announcements marked the second time this month the Trump administration has declared an emergency to quickly approve weapons sales to Israel. The Biden administration also utilized emergency authorities to approve the sale of arms to Israel without congressional review.

On Monday, the Trump administration rescinded a Biden-era order that required it to report potential violations of international law involving US-supplied weapons by allies, including Israel. It has eliminated most US humanitarian foreign aid.

Since Israel’s inception, it has received hundreds of billions of dollars in US foreign aid, a level of support that reflects many factors, including a US commitment to Israel’s security and the countries’ shared foreign policy interests in the Middle East.

Israel is a leading buyer of US weapons systems via traditional arms sales. The Council on Foreign Relations (CFR) report found Israel as one of the largest cumulative recipient of US foreign aid since its founding, receiving about US$310 billion in total economic and military assistance.

Nearly all US aid today goes to support Israel’s military, the most advanced in the region. The United States has provisionally agreed via a memorandum of understanding (MoU) to provide Israel with $3.8 billion per year through 2028, as per the CFR report.

The report also highlighted that since the start of Israel’s conflict with Hamas on October 07, 2023, the US has enacted legislation providing at least US$12.5 billion in direct military aid to Israel, which includes US$3.8 billion from a bill in March 2024 and US$8.7 billion from a supplemental appropriations act in April 2024.

 

Pakistan: Suicide attack kills top cleric

The bombing of Darul Uloom Haqqania in KP’s Nowshera district on Friday marks a departure from the recent trend of militants targeting mostly security personnel and government officials. A number of victims lost their lives in the tragedy, including Maulana Hamidul Haq Haqqani, head of the institution, who appeared to be the religious heir of his murdered father, Maulana Samiul Haq.

The latter, along with his involvement in Pakistani politics, was known as the ‘Father of the Taliban’; he had earned the moniker because numerous high-ranking Afghan Taliban leaders had attended his madressah. Media reports have quoted police officials as saying that it was a suicide blast, and that Hamid Haqqani was the apparent target.

While no group has claimed responsibility for the terrorist attack, the Afghan Taliban have insinuated that the self-styled Islamic State may be involved. An Afghan interior ministry official, while condemning the attack, pinned the blame on “enemies of religion”, an apparent reference to IS.

Those familiar with the militancy dynamics of the region also concur that there is a strong possibility that this is IS-K’s handiwork, as the latter had been openly critical of the Haqqania seminary.

There is, of course, no love lost between the Afghan Taliban and IS, but from Pakistan’s point of view, if the attack were indeed traced to IS, it would signal a fresh security challenge in KP.

Already the province, as well as parts of Baluchistan, are witnessing frequent terrorist activity believed to be carried out by the banned TTP and affiliated groups. IS is an equally — if not more — ferocious entity, with global pretensions and a mediaeval, sectarian outlook.

What adds further credence to the belief that IS may be involved is that the group, and those adhering to its ideological narrative, view clerics who endorse democracy in any form with disdain. The late Haqqania head, as well as his father, were active in politics, along with their religious activities.

It is also a possibility that the Haqqanis’ strong links with the Afghan Taliban could have made them prime targets for rival militants. Only a thorough probe can establish the facts, while fresh IS activity in the country should be cause for considerable concern.

Nevertheless, the attack also offers an opportunity for Islamabad and Kabul to work together against a common, and highly dangerous foe.

Courtesy: Dawn

 

 

Why no oil pipeline after Trans Mountain?

The Canadian energy sector has proposed several major oil pipeline projects in the last decade, but only the Trans Mountain expansion project was completed.

There are three other pipelines that never came to be:

Energy East

A proposed C$15.7 billion project (US$11.0 billion), Energy East would have carried oil cross-country from Alberta to the Atlantic province of New Brunswick. It was cancelled in 2017 by TC Energy in the face of regulatory hurdles and opposition from environmental groups, particularly in Quebec.

Northern Gateway

This pipeline was proposed by Enbridge in 2006 to carry oil from Alberta to British Columbia's northwest coast. The C$7.9 billion project (US$5.5 billion) faced opposition from local and Indigenous communities who feared the risk of a marine spill. The project died in 2016 after Prime Minister Justin Trudeau's government cancelled its permits.

Keystone XL

This proposed TC Energy project would have carried oil from the oilsands of northern Alberta to the major US crude storage hub at Cushing, Oklahoma and then on to US Gulf Coast refineries. The project was rejected on environmental grounds by former US President Barack Obama's administration, then revived during President Donald Trump's first administration. Former President Joe Biden revoked the pipeline's permit on his first day in office in 2021.

TC Energy spun off its oil pipeline business in October last year into a new company named South Bow Energy. Trump said on Monday he wanted the pipeline built, but South Bow said it had moved on.

TC Energy has sought to recover more than US$15 billion from the US government for cancellation of the project

 

Five Takeaways from Trump-Vance-Zelensky meeting

An astonishing scene played out in the Oval Office on Friday as President Trump and Vice President Vance got into a shouting match with Ukrainian President Volodymyr Zelensky, reports The Hill.

Amid angry crosstalk, Trump told Zelensky “without us, you don’t have any cards” and “you’re gambling with World War III.” Vance, for his part, accused Zelensky of being “disrespectful.”

Zelensky had taken issue with Trump’s depiction of him as having so much “hatred” for Russian President Vladimir Putin that it made it hard to end the conflict.

The Ukrainian president also pushed back on Vance’s suggestion that diplomacy could end the war — insisting that his nation had previously adopted that approach after Russia annexed Crimea in 2014, only for Putin to launch a full-scale invasion in 2022.

The clash derailed the proposed signing of a deal granting the United States some rights over Ukraine’s mineral deposits. A news conference between Trump and Zelensky that had been scheduled was abruptly canceled, and Zelensky left the White House without further comment.

Here are five big takeaways:

A row heard around the world

It’s hard to exaggerate the seismic shock created by the squabble in the Oval Office.

The political world, in the US and internationally, was instantly aflame over what had taken place. On cable news, usually loquacious anchors were left struggling for words.

It’s been years, if ever, since such a spectacle was seen on public display at the White House.

Inevitably, the shock spurred fevered speculation. One big question was whether Trump and Vance had intentionally provoked Zelensky, whom Trump recently dubbed a “dictator,” into a confrontation.

The other was whether the Ukrainian leader had reacted too intemperately in the moment, to the detriment of his national interests.

Certainly, Trump’s initial comments about Zelensky’s “hatred” for Putin carried a disparaging tone that it is hard to imagine being expressed toward any other US ally who was trying to repel an invasion. 

Likewise, Vance’s role will be closely dissected, especially his reference to Zelensky being “disrespectful” and his demands that the Ukrainian president say “thank you” for US aid.

But Zelensky’s volleys back made it clear he was not going to adopt the mollifying tone used by the week’s other high-profile visitors to the White House, French President Emmanuel Macron and British Prime Minister Keir Starmer.

The White House has seemed to celebrate the encounter.

Meanwhile, a photo posted by CNN’s Kaitlan Collins of the Ukrainian ambassador to the US with her head in her hands during the encounter told its own story.

Now what?

The big question is where things go from here.

The minerals deal was presented, at least in some quarters, as a way to reimburse the US for future assistance to Ukraine, but Trump had been conspicuously vague on the key point of whether Washington would offer firm security guarantees in return.

Now, with that deal presumably shelved for the foreseeable future, nobody honestly knows what happens.

Zelensky could lean more heavily on Europe for both military and diplomatic support. Macron and Starmer have far more pro-Ukrainian viewpoints than does Trump. 

Italian Prime Minister Giorgia Meloni, who has more of a Trump-like worldview, called on Friday for an immediate summit between the US and European nations to discuss Ukraine.

If the spigot of US aid is to be choked off and a piqued Trump is now fully embittered against Zelensky, the future looks bleak from a Ukrainian perspective.

It’s also worth noting that neither the US nor its European allies are willing to put boots on the ground during the war itself, for fear of being drawn into their own war with Russia

The suggestion so far is that the Europeans might help shore up a peace agreement — if one is reached.

Democrats, Trump critics blast Trump for helping Putin

Prominent Democrats blasted Trump and Vance for how they conducted the meeting with Zelensky, and some other Trump foes joined in.

Senate Minority Leader Chuck Schumer on social media accused Trump and Vance of “doing Putin’s dirty work” and pledged that “Senate Democrats will never stop fighting for freedom and democracy.”

Sen. Elizabeth Warren contended that it was “shameful and dangerous” for Trump to engage, as she saw it, in “treating the destruction of a democracy as a political show — throwing Ukraine to the wolves and doing a favor for Putin.” 

Meanwhile, former Republican congresswoman and leading Trump critic Liz Cheney said on social media that Trump and Vance had “attacked Zelenskyy and pressured him to surrender the freedom of his people to the KGB war criminal who invaded Ukraine.”

Cheney added, “History will remember this day— when an American President and Vice President abandoned all we stand for.”

Trump loyalists wear such disapproval as a badge of honor, of course. But there is no mistaking how deep the dismay runs on the other side.

Republicans counter that Trump stood up for American interests

GOP voices rushed to acclaim Trump — and often bash Zelensky — for the way the Oval Office drama went down.

Broadly, the chorus of Republican approval viewed Trump as standing up for American interests and cast Zelensky as an ingrate.

Treasury Secretary Scott Bessent told Bloomberg that the Ukrainian president “chose to let things go into a downward spiral on worldwide television.”

Sen. Lindsey Graham said he had “never been more proud” of Trump and blamed Zelensky for a “disrespectful” display.

“I don’t know if we can ever do business with Zelensky again,” Graham said.

Sen. Bill Hagerty, alluding to the contrast with the Biden presidency, wrote on social media, “The United States of America will no longer be taken for granted. The contrast between the last four years and now could not be clearer. Thank you, Mr. President.” 

The White House Office of Communications collated many such responses and sent them out in an email with the subject line, “Support Pours in for President Trump, VP Vance’s America First Strength.”

Happiest of all: Russia

For all the delight expressed by some of Trump’s domestic allies, the real gloating seemed to come from Moscow.

Putin ally Dmitry Medvedev, who served as Russia’s president more than a decade ago, celebrated on social media that “the insolent pig finally got a proper slap down in the Oval Office.”

Medvedev also endorsed Trump’s view that Zelensky was gambling with World War Three. 

The Associated Press (AP) quoted a Russian lawmaker, Andrei Klishas, as describing the outcome of the meeting as “a brilliant result.”

Klishas, per the AP, wrote on Telegram that Zelensky had “played his role of a ‘president’ poorly in the White House and was thrown out for bad behavior and disrespect towards the US.”

Whatever Trump’s intentions, the current picture could hardly look rosier from the Kremlin’s perspective. 

Russia has been advancing on the battlefield, Ukraine is now starkly at odds with its chief benefactor and it’s not at all clear Trump will press Putin for major concessions in any peace deal.

 

PSX remains volatile throughout the week

Pakistan Stock Exchange (PSX) remained volatile throughout the week, with the KSE-100 index closing at 113,252 points, up 0.4%WoW on Friday February 28, 2025.

The week started on a positive note, buoyed by initiation of talks for up to US$1.5 billion climate financing from IMF, government proposals for energy tariff cuts and resolving circular debt, and strong corporate results, particularly from banking and cement sector.

However, the momentum faded during the latter half of the week due to absence of fresh triggers.

On the climate financing front, authorities are discussing the implementation of carbon levy, meanwhile, IMF has objected the exemption of sales tax on local EV component sales.

On the macro front, Pakistan signed several accords and committed to boosting bilateral trade with Azerbaijan and Uzbekistan during the Prime Minister's visits to respective countries and signed agreements with UAE during the visit of Abu Dhabi’s Crown Prince.

Inflation is expected to ease further to a nine-year low of 1.9%YoY in February 2025, driven primarily by falling food and energy tariffs.

On the external front, foreign exchange reserves held by State Bank of Pakistan (SBP) rose by US$21 million to US$11.2 billion.

Domestic currency depreciated by 0.04%WoW to close at PKR279.67/US$.

Market participation also remained subdued during the week, with average daily traded volume falling by 17%WoW to 492 million shares, from 593 million shares a week ago.

Other major news flow during the week included: 1) GoP collected PKR23 billion from 16 banks against windfall tax, 2) Pakistan, Vietnam set US$3 billion annual trade target, 3) SBP invites bids for PKR200 billion PFL buyback auction, 4) Pakistan, Iran agree to boost bilateral trade to US$10 billion, and 5) Petroleum Division proposes PKR392.5 billion PSDP for in-house projects.

Glass & Ceramics, Real Estate Investment Trust, and Commercial Banks were amongst the top performing sectors, while Jute, Property, & Leasing Companies were the laggards.

Major selling was recorded by Individuals and Foreigners with an aggregate net sell of US$24.5 million. Mutual Funds absorbed most of the selling with a net buy of US$31.6 million.

Top selling scrips of the week were: TGL, PKGP, MLCF, NATF, and AGP, while laggards included: MEHT, NCPL, BIPL, SEARL, and AKBL.

According to AKD Securities, market outlook remains positive, with upcoming meeting of Monetary Policy Committee (MPC) meeting scheduled for March 10, 2025, and any developments on IMF review remaining in the investor’s focus.

Over the medium term, the KSE-100 is anticipated to remain on upward trajectory, primarily driven by strong earnings in Fertilizers, sustained ROEs in Banks, and improving cash flows of E&Ps and OMCs, benefiting from falling interest rates and economic stability.

Top picks includes, OGDC, PPL, MEBL, MCB, HBL, FFC, ENGROH, PSO, LUCK, FCCL, ILP, INDU, and SYS.

 

Improving Pakistan-Bangladesh Relations

Bangladesh’s foreign affairs adviser, Touhid Hossain, recently stated that there is no longer any reason for strained relations with Pakistan. This shift in sentiment is underscored by the announcement of Pakistan Deputy Prime Minister Ishaq Dar’s planned visit to Dhaka in April, signaling a thaw in decades of frosty relations.

The change can be traced to August, when Bangladesh's former Prime Minister Sheikh Hasina was ousted after 15 years in power. Her tenure was marked by a strong alliance with India, seen in bilateral agreements, trade, and security collaborations. However, her removal created a diplomatic shift, leading to a cooling of ties with New Delhi and an opening for improved relations with Pakistan.

This shift is significant given the historical grievances stemming from the 1971 Liberation War, which have long impacted relations. Despite this, recent months have seen several high-level engagements between Bangladesh and Pakistan, indicating a thaw. Notably, Nobel laureate Muhammad Yunus, an adviser to Bangladesh’s interim government, met with Pakistani Prime Minister Shehbaz Sharif twice, highlighting the growing importance of ties with Pakistan over India.

Trade is emerging as a key area of cooperation. From August to December 2024, bilateral trade grew by 27%, and both countries signed an MOU in January to establish a joint business council. Similarly, in the defense sector, several high-level meetings between military officials from both countries have focused on regional security, joint military exercises, and arms trading. The term "brotherly countries" used by Pakistan’s military further signals a potential shift in South Asia’s security dynamics.

China also plays a strategic role, being a key partner to both nations. India’s concerns are rising, especially with Bangladesh’s interest in acquiring JF-17 Thunder fighter jets from Pakistan, which could alter the regional balance of power. This development has the potential to deepen the trilateral ties between Bangladesh, Pakistan, and China, prompting India to reassess its diplomatic and military strategies.

India must adapt to the changing dynamics by adopting a pragmatic approach that acknowledges Bangladesh’s evolving priorities while reinforcing historical ties. This will ensure India remains a key player in South Asia’s shifting landscape. Managing these relationships is crucial for all three nations. Bangladesh must balance its new ties with Pakistan and its economic dependence on India, while Pakistan must recognize its economic limitations. India, in turn, must address Bangladesh’s grievances to avoid further alienation.

Handled carefully, this evolving relationship could reshape South Asia, proving that diplomacy can overcome even the most entrenched divides. This moment presents an opportunity for Pakistan, Bangladesh, and India to redefine their futures in a geopolitically complex region.

ECO Regional Planning Council Meeting

The 35th Regional Planning Council (RPC) of Economic Cooperation Organization (ECO) kicked off in Tehran with the participation of delegations from relevant ministries and organizations of ECO member countries. This council, as the key decision-making body of the organization, will discuss and approve the annual work program of the ECO.

This session is being held from February 24 to 27 at the ECO Secretariat with the presence of senior officials from ECO member countries to plan ECO activities for the year 2025.

The ECO Secretary General stated that in recent months, ECO activities to enhance cooperation between countries in various fields have seen a significant increase.

According to the ECO Secretary General, this meeting is of particular importance to mark 2025 as a milestone year with several important ministerial meetings in the fields of trade, tourism, finance, transportation, internal affairs, and sustainable development, as well as the 17th ECO Summit to be held on July 3-4, 2025, in Azerbaijan.

The RPC is the main technical planning body within ECO which comprises the heads of the Planning Organizations of the Member States as well as officials and experts from the national sectoral ministries and agencies. RPC convenes its annual meetings prior to the regular meeting of the Council of Ministers under the chairpersonship of the representative of the Member State holding the chairpersonship of the Council of Ministers. Meetings are normally held in the ECO Headquarters in Tehran.

The RPC is responsible for preparation of the programs of action for realizing the objectives of the Organization along with stocktaking of previous programs. It may also propose to the Council of Ministers the establishment of regional institutions and ad-hoc committees in priority areas of cooperation.

Annual RPC meetings are normally structured along one plenary session as well as several parallel sectoral committees dealing with the priority sectors of the Organization. One-year programs of work and ECO calendars of meetings are also developed by RPC meetings on the basis of the proposals made by the Secretariat and the Council of Permanent Representatives.