Fast moving economic, technological and strategic developments are rapidly transforming the global geopolitical scenario. China’s phenomenal economic growth combined with the rise of other emerging economies like those of India, South Korea, Indonesia and Malaysia will shift the world economic centre of gravity to Asia within the next two decades or even earlier depending upon the future pattern of economic growth rates. Within the next two decades, Asia will have the world’s first, third and fourth largest economies in nominal dollar terms (China, India and Japan respectively) besides the sizable and fast developing economies of South Korea, ASEAN and Australia, and the oil and gas resources of the Persian Gulf and Caspian Sea regions. In purchasing power parity (PPP) terms, the change will be even quicker. China will become the largest world economy in PPP terms before 2020. Technologically, Asia has still a lot to do to catch up with the advanced countries of North America and Europe. But it can be safely assumed that the fast growing Asian economies will allocate increased resources to education, research and development to accelerate their technological advancement in the years to come. In short, while America and Europe will remain important economically and technologically, the relative weight of Asia in the world economy will increase rapidly in the foreseeable future.
These economic and technological shifts will produce their inevitable strategic consequences. The strategic importance of the lanes of communications through the Pacific and the Indian Oceans will increase exponentially because of the rapid growth of the maritime trade passing through them. Major world powers will be forced to enhance the deployment of their military assets in the Asia-Pacific and the Indian Ocean regions for protecting their economic and security interests, thus, setting off an arms race and intensifying great power rivalry in these regions. The US has already announced the rebalancing of its military assets in favour of the Asia-Pacific region with the aim of containing China as pointed out in my previous article. (The US pivot towards Asia, the Nation, 7th August). Major Asian powers, particularly China, Japan, South Korea, Indonesia, India and Australia, can be expected to respond to the US move in different ways to protect their own perceived security and economic interests. Some of these countries may align themselves with the US. In particular, coming years will witness rapid growth in China’s military expenditure though it will remain far behind that of the US for the next two decades, according to present forecasts.  
Pakistan with its location at the cross-roads of South Asia, the Middle East and Central Asia and as a littoral state of the Indian Ocean will be directly affected by the expected economic and strategic transformation. It must, therefore, take appropriate steps to secure and promote its own economic and security interests in the face of the developments looming on the horizon. It goes without saying that Pakistan must adjust its diplomatic, security and external economic policies so as to accord greater weight to Asia than has been the case in the past. Further, Pakistan’s strategic partnership with China must be the linchpin of its Asia policy. But this alone is not enough.
The most important lesson of history and the global transformation underway is that the rise of nations depends on their economic and technological strength more than anything else. The US first became the world’s most powerful nation economically by the end of the 19th century before becoming the most powerful country militarily in the 20th century. The relative economic decline of the UK inevitably led to its decline as a great power in the 20th century. Germany has emerged as the most powerful nation in Europe because of its economic strength despite its defeats in World Wars I and II. China has emerged as a powerful nation on the international scene because of its rapid economic growth. In contrast, the Soviet Union disintegrated primarily because of its economic weakness rather than any shortage of conventional or non-conventional weaponry. 
Sadly, Pakistan’s leaders and policy makers, especially its military establishment, refuse to learn from history. From the very beginning, we put the cart before the horse by over-emphasizing the military build-up instead of focusing on strengthening ourselves economically. The fact that for almost half of our country’s history we were under military governments and during the remaining half Pakistan’s military establishment continued to pull the strings from behind the scene, did not allow us to move in the right direction. Historically speaking, the lion’s share of the annual budget has been claimed by the military sector leaving little for economic development.
Even in the budget for the current financial year, a total amount of Rs.793 billion has been allocated for defence including the announced defence allocation of Rs.545 billion, military pensions amounting to Rs.98 billion and the hidden military expenditure estimated to be Rs.150 billion. The total budgetary allocation for defence would, thus, constitute about 44% of the net federal revenues! Pakistan’s weak economy simply cannot sustain such a high level of military expenditure. Little wonder that the economy is in a shambles. By way of contrast, Deng Xiaoping, China’s late paramount leader, told his generals in 1979 to live within a budget of less than 1.5% of GDP while introducing the policies of economic reforms and opening to the outside world. These policies generated the forces which put China on the trajectory of rapid economic growth enabling it to become the second largest economy in the world within a span of three decades.
Besides the excessive allocation of the nation’s resources to the defence sector, our leaders and policy makers have grossly mismanaged the economy by encouraging a lavish style of living among the civil and military elite, tolerating avoidance of taxation by the elite, neglecting education and the development of physical infrastructure, and promoting a policy of excessive dependence on foreign assistance for our economic needs. The results of these policy failures are an extremely low national saving rate of roughly 11% of GDP as against 51% in the case of China and a low tax-to-GDP ratio of about 9% s against the average of 15% in the case of developing countries and over 30% in the case of many developed countries. The low level of national savings translates itself into low national investment and economic growth rates. The low level of tax revenues restricts the ability of the government to provide adequate funds for economic growth, education, health and the development of the nation’s physical infrastructure. Our rejection of the policy of self-reliance and excessive dependence on foreign assistance for meeting our economic needs has skewed our domestic priorities, encouraged corruption in the public sector, and robbed us of manoeuvrability in the conduct of our foreign and security policies. These are serious drawbacks which we must overcome to come to grips with the challenges posed by the aforementioned global transformation.
The global transformation that is underway requires us to accord the highest priority to the goal of economic development as China has done and to adopt a comprehensive national security policy instead of the uni-dimensional emphasis on the military sector which we have practised so far. A comprehensive national security policy must cover adequately its economic, political, diplomatic and military dimensions as part of a well-calculated grand strategy. Unfortunately, there is hardly any realization among our policy makers and leaders of the imperative of a comprehensive national security policy or the necessity of a grand strategy. These important subjects, however, call for a more focused treatment in a subsequent article.  

The writer is a retired ambassador and the President of the Lahore Council for World Affairs E-mail: javid.husain@gmail.com