Girja Shankar Dixit
Pakistan is broke. But its military isn’t.
Fighter jets, drones, submarines, warships—Islamabad continues to amass them all, even as it lurches from one financial bailout to another. With a GDP barely scraping $236 billion and over $7 billion allocated to defence this year alone, Pakistan’s military might seems immune to its deepening economic crisis.
Why? Because the rules change when your arms supplier is also your banker.
China provides over 80% of Pakistan’s military imports, and it doesn’t just deliver the hardware. It offers the money to pay for it too, with generous grace periods and flexible repayment terms. Pakistan doesn’t need cash to keep arming itself. It just needs the right friends.
Add to that a military that runs a sprawling commercial empire—owning farmland, cement factories, investment councils, and housing projects—and you get a state within a state. The Pakistan Army earns, spends, and arms itself independently of the civilian government’s collapsing finances.
The math should never have worked. But it did—because the international community made it work.
Since 1948, the United States alone has poured in over $150 billion in economic and military aid to Pakistan. Throw in contributions from Canada, Britain, and Europe, and the figure crosses $86 billion more. Where others used aid to build economies—South Korea and Taiwan being prime examples—Pakistan used it to entrench military dominance.
Pakistan never gave up its obsession with India. And every dollar only made its military stronger.
And because budgetary walls in Pakistan are porous, even IMF bailout funds can indirectly subsidize its defence. With the military’s grip on power and resources firmly intact, there’s little appetite for reform. Pakistan berates Uncle Sam every few years—then shows up again, hand outstretched. Uncle pays. Pakistan plays.
But here’s the question: can a country win a war with loans?
Wars are decided on the battlefield, not on balance sheets. Money can buy weapons and pay soldiers, but it cannot guarantee morale, discipline, or strategic effectiveness. A war effort bankrolled by debt is ultimately unsustainable. Debt accrues—and it must be repaid. A country trapped in prolonged conflict will likely see its economy further deteriorate, making debt servicing even harder. This creates a vicious cycle of borrowing, begging, and further instability.
Wartime loans create significant economic vulnerability. Conditions attached to these loans can dictate national policies, compromising sovereignty and long-term development. True victory in war comes from internal strength—economic resilience, social unity, visionary leadership, and achievable strategic goals.
A nation that leans entirely on foreign loans and alms, without fixing its broken economy or bridging internal divisions, is building its war machine on sand. Loans may offer a temporary boost, but they do not solve the root problems that could ultimately lead to defeat.
Even if borrowed money helps achieve short-term objectives, the long-term costs can be devastating. A debt-ridden nation may struggle to rebuild its economy, serve its people, or ensure lasting peace.
True victory in war is never just military—it is strategic, moral, economic, and political. Relying on external loans to chase that victory is a dangerous illusion.
