Qatar attack shatters dream of neutrality along with geoeconomics

It is an epochal event that could be a catalyst in the Persian Gulf region specifically and in the wider Middle East. Amongst several issues emanating from the can of worms, I am detailing few on the subject of geoeconomics.

Gone are the days when Qatar boasts of her image as neutral turf for known and unknown antagonists to parley together in hotels and exclusive apartments. Afghans to the East, Persians closer home and antagonists from Levant all had outings, meetings and serious diplomatic and geoeconomics discussions. Hamas was given an exclusive place for them to work in alliance, perhaps under the tutelage of the Qataris.

When Israel targeted the assemblage of Hamas bigwigs this week it opened up a can of worms triggering emergency sessions not only far away in the White House but within the portals of every capital with special emphasis in Middle East. Despite the outpouring of condemnation from elsewhere, for America it was just business as usual.

Military and political angles apart the attack shattered the only lynch pin Qatari wheel has in functioning as a blossoming state: Neutrality. In fact the Qatari rulers mindful of their small size but with the vast natural gas reserves closer to their shore in the Persian Gulf some of it is shared with Iran, were always associating with  powerful armies in the world including USA & Turkey to ensure a semblance of security. Assurance apart, the Americans neither had the gumption to defend Qatar from Israeli onslaught nor are keen to allow others to get involved.

Outnumbered by almost 1 to 5, Qataris were getting their day to day tasks done using cheap labour from South Asia. That is a thin piece of ice on which Qataris are walking around. Assume if a major breakdown takes place the immigrant labour would vanish into shadow.

To camouflage, false sense of security, Qatari dream castles were built upon a combination of geoeconomics structure where she would enjoy Singapore style admin wherein no foreign country is dare to mess around. Besides every nation has diplomatic and commercial representation in the city state.

The other ingredient is Swiss style tourism bolstered on the inviolability of neutrality which is so famous that the victorious allies masterminded it as government system in Austria after her defeat in the WWII.

Qatar had about 11,637 square kilometres of land area in a peninsular shape whose southern tip borders on Saudi Arabia. It was vulnerable then and as it is now to the mechanization of the Saudis. Citing Qatar's alleged support for terrorism as casus belli Saudi imposed an embargo that lasted 4 years from 2017. During this period it was only Iran that gave Qatar sustenance including bottled water.

Qatar has got nothing to do other than supplying natural gas and providing space for colloquium of interlocutors who make negotiation and deals for colossal amounts. Put it simply, Qatari power rests on the two pillars of geoeconomics of natural gas and venue for business negotiation.

Hence her business strategy was fully immersed in her clout as a geoeconomics purveyor. By a single attack Israel has succeeded in rubbishing Qatar to a nonentity.

 

Cheers!

 

Muthu Ashraff Rajulu

Business Strategist

Mobile: + 94 777 265677

E-mail: cosmicgems@gmail.com

Blog:   Business Strategist

How China shapes Pakistan as strategic front?

Playing a long game China picked Pakistan as a client state immediately after the Partition of India when Kashmir catapulted to the bone of contention between India and Pak. Ironically, at this time China was slowly emerging as a unified state whereas India gets fragmented. China drew the right conclusions:

Even though China was not a party to this great divide, China knew that she is becoming a great nation at the expense of the United India onto her west. By 1949, China was in closer contact with the rulers of Pakistan than with Nehru of India. For the Chinese calculus, India and Pakistan remaining at loggerheads is a boon not a bane. There are three prongs to this iron brother legend:

On the political and diplomatic angle Pakistan is a friendly neighbour to China oftentimes acting as go-between her and the hostile west chiefly USA & UK. This culminated when the Ping-Pong diplomacy engineered by Pakistan brought the two antagonistic nations Chia and America to a parley where Nixon and Mao met in Beijing in 1972. In fact Pakistan was reciprocating China for the assistance she extended during the Bangladesh independence struggle which India masterminded leading to the loss of East Pakistan eventually.

Since then, Pak was in tight embrace with China whose relationship binds both as “Iron Brothers”. Hence making Pakistan as a geopolitical power of note is vital for China. Since the ouster of Imran Khan Pakistan was almost isolated diplomatically. This did not give any heart-ache to China. Instead she gave all-round diplomatic support to Pak to wade through the political crisis. “Operation Sindoor” by India and her resultant loss of military hardware including fighter jets gave Pakistan greater prestige.

In terms of geostrategy China ensured that Pak has top rung military preparedness where India was forced to fight a single front with two nations: Pakistan directly and China indirectly. Downing of several Rafale planes in dog-fights made Pak a peer competitor to India despite the latter’s enormous size in terms of land and other resources.

The third prong of Sino-Pak ties is anchored on geoeconomics. You know the simple truth: Pak is an indebted nations who live from one dole out to other happily granted by the World Bank. What is exacerbating is the rising quantum of yearly dose infused by the WB/IMF Duo. Yet, the cream on the cake cannot be ignored: China Pakistan Economic Corridor (CPEC) a 3,000 km infra-structure project that links China to the Indian Ocean. CPEC is estimated to cost more than USD 65 Billion at the current prices. What is astonishing is that, the United States with all the ballyhoo, does not lift a finger against neither Pak nor China. Both are in the same capitalistic game. How to divide the colossal mineral wealth of Pakistan estimated to be around USD 8 Trillion. That vouches for the Geoeconomics clout Pak has now got to flaunt.

The bottom line is what kind of a business strategy the corrupt Pak leaders would unveil to capitalize on the mineral findings. What is certain is China finally succeeded in making Pakistan a strategic front in all three areas: geopolitics, and geostrategy and now in geoeconomics!

 

Cheers!

 

Muthu Ashraff Rajulu

Business Strategist

Mobile: + 94 777 265677

E-mail: cosmicgems@gmail.com

Blog:   Business Strategist

Appraising business policy, easy steps

In strategy the fundamental principle is “concept begets policy & policy begets strategy”. Here strategy becomes the end goal. The heavy middle path is the policy where conceptualization of policy turns out to be the first step. Then comes policy appraisal which is the most arduous task. Here is a fool’s guide of appraising policy in easy steps:

Look at the cost benefit ratio as the first concern. If a particular business policy such as buying Russian discounted oil amid geoeconomics sanctions and making a big chunk by re-packaging it as your own product and selling elsewhere you tend to earn great deal of temporary lucre. But you also earn the wrath of powers including America and the Western Europe who are bent upon delivering a strategic defeat on Russia. Needless to say, the trade-off must be neatly balanced to get the best of the both world.

The second aspect of enquiry is who gets the benefit and who suffers the loss. In geoeconomics there are always two sides of the coin. Say for example, when a country imposes trade related restrictions, chiefly amongst these is tariff placed on imports of items from the rest of the world she needs to appraise who will benefit and who shall lose.

In most cases the tariff is inward looking in the sense it proposes to increase domestic manufacture and reduce importation volume. In this scenario exporting country at the first sight appears to lose as her quantum of exports slides. However, this can be off-set by the exporting country if it succeeds in finding alternate markets. But the real question is whether the tariff imposing country has the ability to increase manufacturing in the short run. If not the cost of living is hiked up as the tariff amount is ultimately passed on to the final consumer.

It is curious to note, that when Russia began to discount oil price to the market floor price all hell broke down. Russia gains whatever happens to the importer of her discounted oil who is caught on the cross-hairs of countries who have imposed sanctions on the sale of Russian oil. These countries have the unpleasant task on hand to impose punitive tariffs upon the exporters of the countries who buy Russian oil resulting in bad blood between both of them.

Finally find out who is paying the price for the continuation of business policy of buying discounted Russian oil by one side and sanctioning that by the other side. Invariably it is the public at large who suffers in both countries: the importer of discounted Russian oil and the imposer of sanctions over it. Ultimately, the imposer of tariff stands to lose both sides of the bargain, when domestic inflation hits higher than the status quo ante.

 

Cheers!

 

Muthu Ashraff Rajulu

Business Strategist

Mobile: + 94 777 265677

E-mail: cosmicgems@gmail.com

Blog:   Business Strategist

 

Russia alerts the world of crypto turmoil ahead

Recent pronouncement by Anton Kobyakov, a special Adviser to Vladimir Putin, that U.S. has devised a crypto scheme to absolve its massive debt at the expense of global economy alarmed too many analysts in the geoeconomics field. Let me explain:

There are markets of certainty like currency and gold. Globally currency market is regulated so that any currency that is listed in the board can be traded without hindrance. Sometimes a particular currency cannot be traded in a country which is under sanctions. For example USD cannot be traded in Tehran.

Gold on the other hand is traded in major financial centres across the globe. This trading is either in the physical form or in futures contract. The current spot price for physical gold is approximately $3,601.30 per ounce as of September 8, 2025. Futures market relates to gold futures traded across the mercantile centres such as London & Frankfurt. According to the CME group, an estimated 510.000 contracts were traded on September 5, 2025. This volume could embrace a total of 27 million ounce of gold.

On the other hand, there is no clear- cut rules & regulations re crypto currency such as stable coins. For the uninitiated let me describe what is a crypto currency? It is a digital or virtual currency using cryptography for maintaining security and is heavily traded via internet without any oversight by any monetary authority. It operates on decentralized networks using a shared digital ledger called a block chain to record all transactions.

America is in deep trouble as regards to her currency debt totalling more than 35 trillion dollars which it cannot pay if demanded by the holders of the debt. Russia foresees that America might flush this debt into crypto cloud so that the Dollar is automatically devalued and the debt is erased altogether.

Putting it into operation, America might resort to rewriting the rules of gold and or crypto currency markets. Whereas gold is a tangible product crypto being intangible could not be brought under one overall umbrella. Therefore, Anton Kobyakov foresees two different sets of rules one for gold trading and other for crypto currency  be framed so that stringent regulation would throttle the function of the gold as a free market metal as well as break into smithereens the virtual crypto currency so that holders of this non-physical product  would be burdened with additional USD 35 Trillion debt wired into their asset wherein  nominal value be so high yet the real value plummets to the extent that any hitherto perceived value would be erased along with the US Dollar debt owed by the US Treasury.

America did this twice before, during the financial crisis of the 1930s and the 1970s, at the world’s expense. Once again she intends to repeat this exercise. Will the business strategy of US to erase massive work this time around. My take is that unless China being the giant geoeconomics power concur, American economic ship sinks towards Davy Jones' locker.

Cheers!

Muthu Ashraff Rajulu

Business Strategist

Mobile: + 94 777 265677

E-mail: cosmicgems@gmail.com

Blog:   Business Strategist