Spy agencies determining fate of Middle East

We are of the view that the geopolitics in the Middle East are basically driven by the top ace spy agencies CIA and MI6 due to their long presence and lust to attain dominance. Both the agencies often play complementary as well as opposing role. In the Middle East, both the CIA of United States and MI6 of Britain active, but their influence and power are not equal. Here’s a breakdown:

CIA (Central Intelligence Agency)

Stronger presence:

The US has far greater military, economic, and political involvement in the Middle East as compared to Britain, which gives the CIA wider reach.

Resources and scale:

Vast funding, technology, and manpower allow the CIA to operate with more depth — from drone surveillance to covert paramilitary operations.

Regional influence:

CIA has elaborate intelligence sharing agreements with Israel, Saudi Arabia, Jordan, Egypt, and Gulf states. The CIA often leads in counterterrorism, cyber intelligence, and monitoring Iran.

Direct action capability:

CIA has carried out assassinations of Qasem Soleimani in 2020 with Pentagon support, regime-change operations in Iraq in 2003, and drone warfare across Yemen, Syria, and elsewhere.

MI6 (Secret Intelligence Service of Britain)

Smaller but skilled:

MI6 operates with fewer resources but has deep historical networks dating back to the colonial and post-colonial era.

Special niche:

It is strong in human intelligence (HUMINT), diplomatic channels, and discreet operations. Often complements CIA efforts rather than competing.

Influence through alliances:

MI6 maintains ties in former British-influenced states (Jordan, Oman, Gulf monarchies). Often acts as a bridge between US and regional players, sometimes preferred for backchannel talks where US involvement is too visible.

It may be concluded that CIA is stronger in raw power, funding, and reach. MI6 is smarter in specialized, discreet, and historic networks. In practice, they often work together, with CIA leading and MI6 supplementing in sensitive or diplomatic areas.

Still it may be of some interest to readers to compare their weaknesses in the Middle East (CIA’s visibility vs. MI6’s limited resources).

CIA Weaknesses in the Middle East

Visibility and Reputation:

The CIA is often seen as the symbol of American interventionism. Its role in the 1953 Iran coup, the 2003 Iraq invasion, and drone strikes has created deep mistrust among populations.

Over-reliance on technology:

Heavy dependence on satellite imagery, drones, and cyber tools sometimes weakens on the ground human intelligence (HUMINT). Local actors may feed misleading information (faulty Iraqi WMD intelligence in 2003).

Political Constraints:

The CIA operates mostly within US foreign policy ambit, which can change with administrations (Trump pulling out of Syria, Biden recalibrating Iran policy). This limits long-term consistency in operations.

MI6 Weaknesses in the Middle East

Limited Resources:

Britain’s budget and global presence are much smaller than that of the United States. MI6 often has to “ride on the back” of CIA logistics and surveillance infrastructure.

Reduced Global Clout:

Post-colonial decline means Britain no longer has the political weight it once held in the region. Many Middle Eastern powers see London as secondary to Washington.

Reliance on Alliances:

MI6 depends heavily on Five Eyes (United States, Canada, Australia, New Zealand) for intelligence sharing. Alone, it struggles to project force or influence in hostile zones (Iran, Syria).

Therefore it may be said that in the Middle East CIA is the heavyweight, but MI6 survives by being subtle and clever, often achieving results disproportionate to its size.

Adding Mossad of Israel to the picture really changes the balance of spy power in the Middle East.

Mossad (Israel)

Strengths:

Regional focus and expertise:

Unlike CIA and MI6, Mossad is laser-focused on the Middle East. It enjoys deep cultural, linguistic, and ethnic infiltration skills (especially in Arab states and Iran).

Human Intelligence (HUMINT):

Mossad is known for its daring covert operations that include kidnapping Eichmann (Argentina, 1960), assassinations of Iranian nuclear scientists, and cyberattacks like Stuxnet with CIA help. It uses diaspora networks, business fronts, and deep-cover operatives.

Operational daring:

Conducts high-risk missions the CIA or MI6 would hesitate to attempt due to political exposure.

Political backing:

Israel’s survival depends on intelligence; Mossad has a direct line to top leadership and can act fast.

Weaknesses

Limited global reach:

It operates best in Middle East, North Africa, and Europe; weaker footprint in Asia or Latin America as compared to CIA.

Overexposure:

Mossad’s assassinations and covert operations generate huge backlash; Arab states and Iran actively hunt Mossad operatives.

Dependency:

It relies heavily on CIA for satellite surveillance, funding, and advanced cyber tools.

The Strongest

CIA is the strongest in resources, global reach, and tech. It can topple governments, conduct drone wars, and pressurize allies.

MI6 is the best at diplomacy, subtle influence, and backchannel talks. It is trusted more in Gulf monarchies than the CIA sometimes, due to less heavy-handed reputation.

Mossad is the sharpest blade in the region itself. When it comes to Iran, Hezbollah, Hamas, or Syria — Mossad usually has the deepest, most actionable intelligence.

Netanyahu’s Unabated Gaza Campaign

It has been more than 700 days that Israel has continued military operations in Gaza. It is being said that Israel is doing this under the protection of the United States. However, it may also be said that even countries like Russia, China and Saudi Arabia just could not gather strength to impose any sanctions on Israel. We have the following observations:

US and Western Support

Israel is able to do this under the US and Western Shield. Washington has been providing steady arms supplies and political protection at the UN. The US has been vetoing or forces the presenters to soften resolutions that could force accountability.

Fragile Coalition Politics

Netanyahu’s survival hinges on ultra-right allies who demand maximal war goals. Ending the war could collapse his government and he could end up in jail under corruption charges.

Public Mood in Israel

Despite failure of the government to avert Hamas October 07, 2023 attack, unresolved hostage issue keeps much of society aligned with ongoing military action. Right-wing base still dominates the agenda, even as war fatigue grows.

Weak International Enforcement

The ICJ has ruled there is a plausible risk of genocide, but it has no enforcement arm. The ICC issued arrest warrants, but implementation depends on states unlikely to act against a US ally.

Climate of Impunity

Normalization of extreme rhetoric allows harsher military conduct without domestic blowback. International criticism often fades into symbolic statements.

Divided Opposition

Regional and Palestinian political fragmentation means no coherent alternative pressure strong enough to compel an immediate ceasefire.

Who will be the next prime minister of Japan?

With Prime Minister Shigeru Ishiba poised to step down, attention now focuses on who will seek to lead the Liberal Democratic Party and possibly Japan in his place.

Two possible candidates are Agriculture Minister Shinjiro Koizumi, son of former Japanese leader Junichiro Koizumi, and Sanae Takaichi, a former economic security minister who could become Japan's first female prime minister. Both were strong contenders for the LDP presidency in 2024 but lost to Ishiba.

Whoever succeeds Ishiba as prime minister will need to find ways to work with opposition parties as the leader of a minority government.

Ishiba told a news conference Sunday that he would not seek reelection as LDP president. His standing in the party was undermined by the LDP's loss of a majority coalition in the July upper house election.

Ishiba listed dealing with US tariffs, establishing a disaster management agency and promoting wage increases as some of the areas in which he wants his successor to achieve results.

Candidates for party president need the endorsement of at least 20 LDP members of parliament. Beyond Koizumi and Takaichi, potential contenders include Takayuki Kobayashi, another former economic security minister; Chief Cabinet Secretary Yoshimasa Hayashi; and Toshimitsu Motegi, a former LDP secretary-general. All of them vied against Ishiba in the 2024 LDP presidential race.

Takaichi topped a Nikkei opinion poll last month on the question of who was fit to be the next prime minister, with 23% support, followed by Koizumi at 22%.

In her first bid for LDP leadership in 2021, Takaichi came in third with the backing former Prime Minister Shinzo Abe. She has a base of support among lawmakers who were aligned with the late Japanese leader.

In the 2024 LDP presidential race, Takaichi topped the first round of voting, only to be overtaken by Ishiba in the runoff. She was endorsed by LDP heavyweight Taro Aso, a former prime minister and leader of the party's only remaining faction.

After the election, she declined an offer to become chair of the LDP's powerful General Council and kept her distance from Ishiba's government.

Koizumi served as the party's election chief in the October 2024 lower house campaign but resigned after the LDP failed to keep its majority. The 44-year-old became agriculture minister after the previous one quit over a gaffe, and he has been working to lower rice prices by shaking up distribution. He finished third in the 2024 LDP presidential race.

Hayashi, who placed fourth, has served as chief cabinet secretary, a key post as the Ishiba government's top spokesperson.

Kobayashi holds some support among backbenchers. He finished fifth in the 2024 race.

"I want to consult carefully my colleagues about what I can do," Kobayashi said Sunday.

Motegi, the oldest of these contenders at 69, has a foothold among some members of the LDP's former Motegi faction. He placed sixth last time.

In the presidential election, each LDP lawmaker in parliament has one vote and, as a general rule, an equal number of local LDP members and supporters also cast ballots for a leader.

In special situations, voting can be held at a joint meeting of both houses of parliament in lieu of a party convention.

In the first round of voting in 2024, Takaichi received 72 lawmaker votes and 109 party member votes, while Koizumi received 75 and 61, respectively.

But whoever is elected LDP president in this race has no guarantee of being selected as prime minister by parliament. If all the opposition parties unite behind one rival candidate, the LDP contender cannot win.

The cooperation of opposition parties is also essential to passing a budget and legislation. To secure a majority in Japan's powerful lower house, the next prime minister will need support from the center-left Constitutional Democratic Party, the conservative Japan Innovation Party or center-right Democratic Party for the People in addition to the ruling coalition.

The next prime minister will first face the challenge of agreeing with opposition parties on a fiscal 2025 supplementary budget and a fiscal 2026 budget and tax reform-related bills.

Courtesy: Nikkei Asia

 

Red Sea cable damage disrupt internet in Asia and Middle East

According to media reports, internet access in parts of Asia and the Middle East was disrupted after undersea cables in the Red Sea were cut, experts said Sunday, though the cause of the incident remains unclear.

The outages have raised concerns about possible sabotage amid ongoing attacks by Yemen’s Houthis, who have previously denied targeting subsea cables.

Undersea fiber links form one of the backbones of global internet infrastructure, alongside satellites and land-based networks.

Microsoft said on its status website that the Middle East “may experience increased latency due to undersea fiber cuts in the Red Sea,” though it added that internet traffic not routed through the region was unaffected.

NetBlocks, an internet observatory, reported “a series of subsea cable outages in the Red Sea” degrading connectivity in multiple countries, including India and Pakistan. It said the failures affected the SMW4 and IMEWE cable systems.

Pakistan Telecommunications Company confirmed the cuts in a Saturday statement.

The affected cables are operated by Tata Communications and a consortium managed by Alcatel Submarine Networks. Both companies declined to comment.

Subsea lines can be damaged accidentally by ship anchors or intentionally in attacks. Repairs often take weeks as ships must locate and lift the cable before restoring service.

 

The New World Disorder

French historian Fernand Braudel identified three cycles of history. The shortest is the day-to-day flow of events; Braudel called them “fireflies” on the stage. Next up are paradigm shifts — like the end of the Cold War — that can play out over decades or longer. Finally, there’s the longue durée: the bedrock of climate and geography that shapes everything else and changes only over centuries or millennia.

Six months into US President Donald Trump’s second term, it’s clear that the course of events has changed. What’s the collective noun for a group of fireflies? Probably not “paradigm shift,” but in this case that’s what it adds up to. 

The US pivot from free trade and global security to a sharper focus on the national interest has the makings of a decades-defining transformation, reversing the global integration supercharged by the end of the Cold War.

In the decades after World War II, the US was the champion of free trade, the anchor for global security and the gold standard on governance. Now, it has raised tariffs to the highest level since the 1930s, told allies they need to pay for protection and crossed red lines on independence for the Fed and statistical agencies.

That’s a major break, and an important moment for the global economy, shifting patterns of growth and inflation, borrowing and debt.

The geopolitical landscape has shifted just as decisively. Jolting though it is, Trump’s focus on America First is a reflection of a new reality where the US is no longer the world’s sole superpower. Regardless of who occupies the White House next, the US allies and adversaries will continue to reorient around that new state of affairs.

How about Braudel’s longue durée — the slowest moving cycle of history on which everything else rests? Could even that be at an inflection point? Maybe.

Trump has pulled the US out of the Paris climate agreement, again. The global fight against climate change will continue, but without the world’s second-largest emitter, it gets harder. The arrival of artificial general intelligence could also prove an epochal shift.

“History,” Braudel wrote, “may be divided into three movements: what moves rapidly, what moves slowly and what appears not to move at all.” Right now, events are moving almost too fast to track and the slow-moving Pax Americana is heading rapidly toward the dustbin of history. If global temperatures rise much further or machines start thinking for themselves, there will be movement even in the cycle that appears not to move at all.

Hezbollah: Friend or Foe of Lebanon

Hezbollah occupies a complex position within Lebanon’s political and social landscape, generating both support and opposition.

Arguments portraying Hezbollah as a friend of Lebanon

Resistance role:

Hezbollah emerged in the 1980s as a resistance movement against Israeli occupation, gaining legitimacy particularly after Israel’s withdrawal in 2000 and the 2006 war.

Community services:

The organization provides health care, education, and welfare services, particularly to underserved Shia populations, filling gaps left by the Lebanese state.

Political representation:

Hezbollah holds seats in parliament and ministries, thereby integrating a marginalized sectarian constituency into Lebanon’s political process.

Arguments portraying Hezbollah as a foe of Lebanon

Parallel authority:

Hezbollah maintains a powerful military structure independent of the Lebanese Armed Forces, challenging state sovereignty.

External alignment:

Its close ties to Iran and the Islamic Revolutionary Guard Corps suggest that its priorities may extend beyond Lebanese national interests.

Regional involvement:

Hezbollah’s intervention in the Syrian conflict and confrontations with Israel risk entangling Lebanon in regional wars.

Economic consequences:

Its designation as a terrorist organization by multiple Western and Arab states contributes to sanctions and international isolation, aggravating Lebanon’s economic crisis.

Hezbollah’s dual identity — as both a provider of security and services, and as an armed actor operating outside state control — creates a paradox.

For supporters, it is an indispensable defender of Lebanon.

For critics, it undermines national sovereignty and stability.

The friend-or-foe debate remains contingent on whether one prioritizes resistance against external threats or the consolidation of a sovereign Lebanese state.

 

PSX closes at record high of 154,277 points

Pakistan Stock Exchange (PSX) remained positive throughout the week, with the benchmark index posting CYTD’s 4th highest weekly return of 3.8%, closing at a record high of 154,277 points.

Market participation also increased by 19%WoW, with average daily traded volume increasing to 1,068 million shares from 899 million shares a week ago.

The rally was supported by successful China visit of prime minister, improving industrial activity, easing inflation, and strong corporate results. Cement sector led the gains, driven by a pick-up in domestic demand as local offtakes posted double-digit growth for the second consecutive month alongside rising mortgage lending. Commercial Banks followed on the back of robust results.

During the week, prime minister concluded his China visit, signing US$8.5 billion worth of MoUs and JVs at the second Pak-China investment conference.

On the macro front, August 2025 inflation came in softer than expected at 3.0%YoY against 4.1%YoY, petroleum sales rose 7%YoY on improved demand, and local phone manufacturing surged 2.1x YoY in July 2025.

At Wednesday’s T-bill auction, 1-month paper yield declined to 10.75%.

Trade deficit widened 30%YoY in August 2025 due to weaker exports.

Other major news flow during the week included: 1) PKR2.6 trillion debt repaid ahead of schedule, 2) SBP governor sees GDP growing 3.45% to 4.25% in FY26, 3) digital currency to be legalized once regulation is in place, 4) cotton arrivals increase by 9%YoY, and 5) SBP forex reserves increase to US$14.3 billion as of August 29, 2025.

Cement, Refinery, and Power generation were amongst the top performing sectors, while Jute, Synthetic & rayon, and Vanaspati & allied industries were among the laggards.

Major selling was recorded by Banks and Foreigners amounting to US$22.4 million. Individuals and Mutual funds absorbed most of the selling with a net buy of US$19.7 million.

Top performing scrips of the week were: BOP, HGFA, NBP, JVDC, and AKBL, while laggards included: PKGP, SCBPL, JDWS, IBFL, and UPFL.

According to AKD Securities, PSX is expected to remain positive in the coming weeks, with the upcoming MPC and any developments over circular debt remaining in the limelight.

The benchmark index is anticipated to sustain its 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 of the brokerage house include: OGDC, PPL, PSO, FFC, ENGROH, MCB, LUCK, DGKC, FCCL, INDU, and SYS.