By Col Shakil Ahmed (R)*, SZABIST
Dec 28 - Jan 05, 2003

The central theme of this study is involved around effects of embargoes and the economic sanctions as primary tools of economic warfare and measures to effectively combat this novel form of warfare. Since Pakistan is currently facing some economic sanctions, this article is consequently sought to propose measures by which Pakistan and other developing countries with narrow economic base could effectively combat these sanctions.

The goals of economic warfare are to partially paralyze or completely destroy the enemy's economy, industrial, political, and military might, leading to the complete social and economic breakdown.

The economic warfare was effectively employed against the Soviet Union, by denying her wheat to feed its people. This forced Soviet Union to implode in 1990 and its eventual fragmentation into smaller states. It has also been employed against Iraq immediately after the Gulf War and Libya in 1992 after the bombing of a Pan Am Airlines over Lockerbie, in Scotland. While some states did collapse from the imposition of economic sanction, Syria has been able to resist the grim economic war it has been subjected to since 1980's. Recently, after nine eleven, Pakistan is one of the victims.

How to resist the economic warfare? What is our economic potential? How we can attain the self- sufficiency in the foreseeable future? What are the factors, which nullify our effort for self- reliance? What measures would be necessary to acquire the desired level of sufficiency? What policies are presently pursued to attain self-reliance and what measures should be taken to attain one of the most important national goals of economics self-sufficiency after becoming Atomic Power? These are the questions to be addressed in this study


Economic warfare can be defined as "new tactics carried out by powerful countries to control certain countries in a new methods of war where traditional nuclear or chemical weapons are matured." The main object of this war is to destroy, partially or completely, or paralyze the country and break down its economic organizations through a well organized plan which can keep its negative effects for short and long terms politically, economically, socially and militarily. These wars might be by imposing economical sanction or boycott, partially or wholly.

For millennia, nations have striven to coerce their enemies by seizing their food and raw material in transit, destroying agriculture and means of productions. In the 21st century, economic warfare has been intensified and refined. One of the primary tools of such warfare in the recent history has been the tactics of embargo i.e. denying goods/ technologies that might contribute to enemy's economic development and war potential. This was effectively applied by the US and its allies in the cold war era against the communist countries and was one of the reasons for break-up of the Soviet Union. The more recent application of economic warfare has been in Libya where the political leadership has been forced to accept the terms through fear of economic doom. Pakistan, too, seems to be highly vulnerable to this form of warfare.

William Webster, the former CIA President said about the hidden conflict between Europe and the USA that, 'Our political and military allies are themselves our economical enemies'. (Samir-1999) The USA fears the unity of Europe and started to cancel facilities for the European products and commodities in the USA markets. It imposed fines on some of the dealings out of the permitted frame by Washington.

In April 1992, the Security Council issued a resolution imposing sanctions on Libya. Another penalty was imposed against Libya accusing her of indulging in the bombing of an American airline over the airspace of Lockerbie. This time, the sanction was not like that of Iraq. It is limited to not allowing of buying disallowed military and industrial instruments, preventing the flight of Libyan civil aircraft, freezing overseas accounts, which made Libya to succumb to the US order and hand over the culprits, fearing of extension of sanctions. (Sarbah-1998) On the other hand, the Sudanese were blamed of hiding persons who tried to assassinate the Egyptian President in Addis Ababa, then the Security Council imposed in 1996 barring of airways activities.

Following are the major effects of economic warfare on states with narrow economic base:

ON THE ECONOMIC STATUS: The external trade freezes due to imposing sanctions. Internal trade is the alternative but it is subject to monopolies, which turns the economical status from bad to worse. The loans increase and the country becomes unable to pay the debts and new taxes are imposed.

ON THE SOCIAL STATUS: Diseases because of the shortage of medicine and medical care especially among children who are the victims of these wars. Unemployment is another reason due to the closed factories and unavailability of jobs. All this leads to the increase of crime and rate of illiteracy and ethical decline.

ON THE POLITICAL STATUS: It can mostly cause coups and a new regime holds the power that can support the dominants and facilitate the interests of the new imperialists in the victim country. It can also create new political parties, nationalities, minorities and religious sects that can weaken and divide the country, so it is easy to control that country and use it as a continuous pressure.

ON THE MILITARY STATUS: It completely damages the military forces of the countries and makes them unable to reconstruct or develop their weapons to cope with the international military development. The lack of spare parts and maintenance make these weapons useless. Besides the country is not allowed to import them.


Syria is a country which was also put under Economic Warfare crunch and the methods she resisted that war was admirable and is an example to be followed all over the world:

Syria followed the following methods to resist that war:

*An internal political policy and a national unity, which gathered all levels of the people around the leader taking into consideration Syrian national interest.

*An effective foreign policy, which disallowed the Security Council, from taking a resolution that the sanction is legal by explaining the justice of our issue to the international opinion.

*The support of some Arab and Muslim countries

Moreover, countries have started to give priorities to their economic interests sometimes before their security forces. This is because the new changes led to the rise of the economic factor in international relations and the increased competition for raw material and their desire to open new markets when the local economy of all countries has represented the greatest importance at all levels. Economic spies have become more important than military spies. Men who seek the secrets of modern technology and constructions, even the daily life of people and what they eat, are much more important than those who try to find out information and reach military sites and make photographs.


Nature has endowed Pakistan with sufficient resources. Although, some parts of the country experience arid situation that is compensated by large streams which irrigate the land. It has rich non-metallic resources and modest oil reserves. It possesses rich fields of natural gas. Some large and small Hydel projects have been developed. Its resources could be meager as compared to USA, Russia, China etc but they are in much better position when compared with Belgium and Holland.

Economic progress of a country is dependent upon its economic potential. Main components of economic potential are Human Resources, Population, Labor Force Participation, Education, Agriculture Potential, Land Reforms, and Potential of Industrial Sector. Pakistan has been gifted with all the ingredients of economic potential including Gas & Petroleum resources, Energy & Power potential. However these resources are not being utilized and exploited properly.

There are many factors that are responsible for the non-attainment of the most important national goal; economic self-sufficiency. They can be divided into two main categories i.e. internal and external.


*Underdeveloped Infrastructure
*Undeveloped Agriculture Sector
*Political Instability
*Inconsistent Strategies
*Law & Order Situation
*Low Literacy Rate
*Population Growth
*Inefficient Use of Loans, etc


*IMF and World Bank
*Developed Countries

To achieve the objective of self-reliance the most important factor is the effective domestic and foreign resource mobilization. This potential if exploited with proper planning and sound strategy can bring about dramatic improvement in the economy.

The foreign resources include:

*Foreign investments
*Workers Remittances
*Multinational agencies
*Consortium/World Bank etc

Domestic resources comprise:

*Deficit financing and credit creations
*Export earnings
*Private and corporate savings
*Trade Policy & Trade Potential etc




-Land Reforms
-Water Supply
-Extension Services
-Credit Schemes
-Water Logging

*Domestic Savings
*Political Stability
*Research and Development
*Human Resources
*Family Planning
*Defence Outlay


*Transparency in Income Tax
*To promote the Investments
*Encourage Exports
*Control on Smuggling


I. The government which can immune themselves and their economy against corruption, collapse, disturbance and manage to have a better society and economy and do not depend on what they have achieved but try to achieve more.

II. Giving stress on the complete development in the financial and producing sectors.

III. Giving attention to the foreign financial flow more than normal because this affects the economical situation.

IV. Concentrating on the importance of cooperation among under developed countries because regional blocs are necessary for competition and can ensure economical development depending on real production of goods.

V. Sharing of all sectors in the process of economical construction through economic plurality which makes the private and common sectors bear the responsibility dealing with all sectors as national ones.

VI. All the economic steps must be well planned in taking the advantage of previous experiences to avoid any ill effects on problems.

VII. Cooperation with great countries that have political and economical aims can be beneficial for both countries.


A lot of time has already been wasted in making experiments in Pakistan. Slogans and false hopes cannot satisfy the masses for long. Economic realities cannot be ignored. Therefore, we need to make concerted efforts to improve economic conditions in Pakistan.

Political leadership plays a pivotal role in putting the economy on the right path. Our political system has been in turmoil for longer period since our independence and so has been economy. Our inconsistent policies in almost all the sectors of economy, our indifferent attitude towards development prospects, our inability to attract foreign investments and our failure to promote export have all contributed to the present state of economy. Moreover, foreign debts were not used properly and today debt servicing is taking away a big chunk out of our budget.

We have the potential of achieving economic self-sufficiency. Political stability coupled with sincere and able leadership could put our economy on the right path. Reduction in population growth, higher savings, exploitation of human resources, higher investments, improvement in literacy rate and more emphasis on R & D will help us in achieving our goal of economic self-sufficiency.

Cooperation of the masses is necessary for the success of such a programme. The nation would cooperate if it finds that the leadership is honest and sincere about bringing prosperity to all and not limiting the benefits of development to a selected few. The strategies suggested in this study are natural, simple and in conformity with our resources and national needs. The pre-requisites to this recipe of success are: a committed leadership and the right set of priorities. Let us see when our dream of economic self-sufficiency would come true.

Following are the few recommendation to attain the goal of economic self-sufficiency:

I. Political leadership should use its diplomatic skills to reduce tension with neighboring countries that will help in cutting down heavy defence expenditure. The funds thus saved could be used for the development.

II. It is necessary to encourage small business because they use indigenous technology, local raw material and machine. Also their technology is labour intensive, which creates more jobs per unit of investment.

III. Measures should also be adopted to ensure political stability and better law and order situation to gain confidence of foreign investors.

IV. Pakistan should have mixed economy with the leading role being assigned to the private sector.

V. Agribusiness is still in its infancy and foreign corporate capital enjoying expertise in this field can find ample opportunities to seize and we should apprise the foreign investors of these opportunities.

VI. More funds should be allocated to exploit human resources by increasing literacy, imparting technical training & enhancing R & D.

*The writer is MS/MS student at SZABIST and is grateful to Prof. Dr. Jalbani, Senior Faculty Member, for his valuable guidance and support for writing this article.