Pakistan as a middle power in the new world order

A third conversation, and why it matters

The episode opens with Muzamil framing this as the third time he has had Faisal Aftab on Thought Behind Things, and the most consequential. The first conversation, in May 2023, sounds in his words “almost prophetic” three years later. The second, in 2024, came after Aftab’s appearance on Shark Tank Pakistan and after the start of the war in Ukraine. This one is being recorded with India and Pakistan having gone to war the previous year, with an Israel-Iran conflict still unsettled, and with a US administration that is, on the surface, contradicting its own stated doctrine.

Muzamil sets the stakes plainly. “Whatever you understand of the world today, five years later or four years later by 2030, it is going to look completely different.” That is the frame Aftab is invited to argue against — or to deepen. Aftab, the CEO and founder of Zayn Capital, says he wants to skip the theatre and go to the back end. “There’s really, you know, these are the downstream effects of something happening in the back end,” he says. The visible war is the event. The interesting layer is the one beneath it.

Two lobbies inside the Western alliance

Aftab’s central frame is that the meaningful divide inside the United States is not between political parties. “I personally think politics is an illusion,” he says, “but let’s say Democrats and Republicans there. I think most people today, if you go back to then versus today, kind of realize it doesn’t matter which party you vote for. The policies tend to be very similar when it comes to foreign policy, monetary policy and economics.”

The real divide, in his reading, is between two transnational interest blocks. On one side is the older military-industrial complex — the neocons and neoliberals who, across Bush, Obama, Clinton and Biden, ran what he calls “perpetual unending wars.” On the other side is what he terms the financial-technology industrial complex: big tech, asset management, fintech, crypto rails, traditional banking and venture capital, fused together. He traces the visible fissure to 2015 and Trump’s first run, when the new lobby — the one that did not want a war — successfully backed a candidate who promised not to start one.

The point of this taxonomy is not partisan. It is that the world’s actual decisions are being made between these two complexes, and the current period is a negotiation between them. The military-industrial lobby is expensive and increasingly outmoded; AI, robotics, and digital governance can enforce a system at a fraction of the cost of physical occupation. “Why need to go and kill and enforce it when you could do it through AI and robotics in the future in terms of governance control and enforcement?” Aftab asks. The merger he expects to see — already visible in Gulf sovereign wealth funds taking stakes in BlackRock, in the MAG7 displacing Treasuries as the dollar-recycling vehicle, in central banks de-dollarizing into commodities — is the financial-technology side absorbing what it can use of the older order and discarding the rest.

Every war is a chess move before the settlement

From there, Muzamil pushes Aftab on the specific events: Venezuela, Greenland, Canada, the Monroe Doctrine national security document, and then the apparently out-of-syllabus Iran war that contradicted it. Aftab’s answer is that the contradiction is only on the surface.

“It’s a resource grab,” he says. The paper layer of the system — dollars, rupees, sovereign bonds — has a counterparty risk that is now visible. When trust in the paper erodes, hard assets become the only thing worth holding: oil, gold, agricultural land, food security, energy. The Monroe-doctrine claim on Greenland, Canada, and Venezuela is the United States locking down the hard assets of the Western Hemisphere. The squeeze on Iran is the same logic applied to one of China’s energy lifelines.

Aftab maps the chessboard explicitly. The United States has shale, Venezuelan heavy oil, Canadian oil sands, Greenland. Russia has energy and is talking to both sides. China is the buyer, not energy-independent, scrambling for micronuclear and alternatives. “When you look at the chessboard, then everything else is just a pawn in the game.” Iran, the Houthis and the Red Sea, the Bosphorus and Ukraine, Gaza and the Suez — every one of these is a choke point on a supply line, and every visible war is a move to weaken a rival before the three big players — the US, China, Russia — sit down at a table to negotiate a new monetary settlement. He expects that table to be set within five to seven years.

Aftab also credits the analyst Simon Dixon, whom Muzamil raises, for arriving at a similar reading independently. The convergence is part of why he is willing to state the thesis on camera at all.

The transnational lens that breaks the national frame

Muzamil pushes on a tension in the argument. If the United States is an aging, demographically tired empire — and his year of living there has only sharpened that impression — why would transnational capital still be sitting inside its institutions? Why not just relocate?

Aftab’s answer is that this is exactly what is happening. The financial-technology complex is not loyal to the United States as a polity. It is loyal to growth. The growth is in Asia. The aging West will be kept pacified — “Netflix par laga den, gaming karte rahen, aapko monthly check aa raha hai” — through universal basic income, agentic AI, and entertainment, while the actual financial and technological centres are extended into the parts of the world where the population is young, the black economy is large, and the digitization opportunity is in front of you rather than behind. “We’re going to be the growth engine of the world going forward,” he says, lumping South Asia, Southeast Asia, and West Asia together as the relevant geography.

The tools for that extension, he argues, are already in place. The IMF, the OECD common reporting standards, the push for digital payments, KYC/AML harmonization — these are not random bureaucracy. They are the regulatory rails that allow the system that was built in the West between 1913 and 1945 to be re-laid in the South over the next two decades.

Pakistan as the asset everyone is quietly accumulating

This is where the conversation turns local, and where Aftab makes his most concrete claim. “I’m actually very bullish on Pakistan,” he says. The logic is consistent with the rest of his frame. If you wanted to acquire an undervalued asset, you would first convince its holders that it was worthless. Pakistan, in his reading, is exactly where India was in 2013-2016 before demonetization and the digitization wave that took it from a frontier economy to the fifth largest in the world.

The mechanism is the black economy. Pakistan’s hidden GDP, in Aftab’s estimate, is roughly the same size as its documented GDP. As digital payments expand — through Raast, through cashless adoption, through FBR traceability of platforms like Foodpanda — three to four points of that hidden GDP will be surfaced into the official numbers every year. Layer that on top of the two to three percent organic growth a frontier market gets by default, and Pakistan is back in the six to eight percent band that China and India hit at the equivalent stage of their cycles.

Muzamil tests the thesis hard. The lived experience, he says, is one of fragility, not of latent value. The population is uneducated, the energy bill is crushing, productive capacity is thin. Aftab does not deny any of that. He reframes it. The K-12 system was designed for the industrial age and is now obsolete; AI will collapse the language barrier that has kept Pakistani talent invisible; the “haji sahib” with the office that looks like nothing and five Land Cruisers outside is the actual elite, and digitization is finally going to make that wealth visible and taxable. “Data is the new oil and you’re getting all sorts of data,” he says. “These grey areas eventually will close because it’s the interest of the state.”

The federation problem

Muzamil pushes back on one of Aftab’s secondary claims — that the federation needs to get stronger — by arguing the opposite. Pakistan’s elite, in his reading, is a parasitic rent-seeking class that will not voluntarily allow efficiency. The only way out is to push agency down to local governments so that ninety-nine percent of citizens can focus on water, schools, and roads at the tehsil level, leaving the federation to handle the things only it can handle.

Aftab agrees with the diagnosis but is less optimistic about devolution as the cure. He notes Musharraf’s Nazim system worked in parts, particularly in Karachi, but did not last. His own reading is that the federation has to get stronger first — because of the depth of ethnic, sectarian, and biradri fault lines — and that this strong federation is, in practice, the military-industrial-and-now-financial complex of the Pakistani state. He is explicit that he is observing, not prescribing. “I’m just my observation. I’m not saying I agree or disagree.”

He widens the lens. The Chinese model worked because communism replaced religion as the binding force and clan rivalries kept any one faction from running unchecked for too long. South Asia has neither structure. India is, in his view, succeeding mostly because it has a strong bureaucracy and deep state, not because of its democracy. The model he expects to actually take hold in Pakistan is a hybrid: a strong federation enforced through digital governance, with the military as the binding institution and the financial-technology complex grafted onto it. Fifteen years out, he expects much of enforcement to happen through AI — body cams, traceable transactions, autonomous vehicles that make traffic violations structurally impossible — rather than through humans who can be bribed.

The middle-power thesis

Muzamil raises the analysis of Shabbar Zaidi, the former FBR chairman, who has recently been arguing that Pakistan could earn $150 billion a year as a security guarantor in a post-American Gulf. He asks Aftab where Pakistan tilts and where it should tilt.

Aftab’s answer is the cleanest articulation of his thesis. “There’s some sort of a middle power emerging,” he says. The middle power, sitting between the three big empires, will be a block — Turkey, Pakistan, Saudi Arabia, the GCC — that connects the East and the West physically (rail, pipeline, port) and financially (priced in both yuan and whatever the new Western settlement currency turns out to be). Egypt is important but constrained by its proximity to Israel. India, he expects, will end up firmly in the Western alliance, which he reads as a strategic error on Modi’s part — the historic Indian non-aligned posture was the smarter one.

This is the MENAP frame the two of them sketched in earlier conversations, now sharpened. The defence pact between Pakistan and Saudi Arabia is, in Aftab’s reading, the load-bearing piece. It is why Pakistan can play peace mediator in the current conflict without being forced to choose a side: Saudi can invoke the pact, and no one wants to test what that means. “I think we’re being very smart in the way we’re playing it.”

Muzamil, who has lived this argument across both his Dubai years and his current time in the United States, agrees on the structural logic. Energy on one side, food and human capital on the other, capital flowing through the middle. He adds the consistent caveat that Pakistan has always performed well on the security register and has never managed to convert that into economic value. The hope of this cycle, both of them concede, is that the financial-technology complex on the Western side and the digital-state push on the Eastern side finally give Pakistan a way to convert.

AI sovereignty and Sky47

The conversation’s most concrete forward-looking moment comes when Muzamil describes a personal experience that reframes the macro argument. He had automated much of his own workflow using Claude and OpenAI, replacing two staff in the process. Four days into a sprint, OpenAI locked him out for overusing his compute. He could have paid more — it was a cash-flow problem, not a capacity problem — but the deeper realisation hit him cold. “They have a power over me because I have automated my system so much that the productivity has been driven by a brain that they control.”

He extrapolates. If Pakistan automates state and private productivity using foreign AI infrastructure, intelligence becomes the new oil bill — one-third of imports, denominated in dollars, hosted somewhere else. Even with energy independence from solar, the country swaps one dependency for another. He asks Aftab whether the policymakers understand this and whether anyone is building sovereign compute.

Aftab’s answer is the line that will get the most attention from anyone who works in the space. “One of the biggest projects right now, they’re called Pakistan’s best kept secret, is Sky47, which is the sovereign cloud. We’re building one of the state of the art data centres in Pakistan, and it’s going to be multiple co-locations of it.” He credits the current military leadership for being more “switched on” than the previous generation — less Westernised, less elitist, more grounded in the actual problems of the country. He is careful to frame this as observation, not endorsement, and notes he is apolitical in both Pakistan and the United States.

He also expects stablecoin integration to become mandatory across multiple countries through US pressure, with acceleration after 2027, when he expects the next crisis to force the new digital monetary system into the open. The integration of Raast as a SWIFT-replacement layer, KYC/AML consolidation, and central-bank-level stablecoin rails are, in his view, the same project under different names.

What to do with the next fifteen years

The conversation closes on a personal register. Muzamil, who left Pakistan a year ago, says he did not leave out of hatred. He left because he felt he had outgrown the rate at which the country could grow with him. He notices that everyone who left in the nineties and 2000s left when the destination was shiny; people leaving today are leaving into a world that is also fragile. He asks Aftab where Pakistan is in 2040 in a medium scenario — not the best case, just a reasonable one.

Aftab’s answer is generous. “If you’re younger, there’s nothing wrong with leaving,” he says. People who leave become assets. They send remittances. They come back with capital, knowledge, and networks. The frustration of a 25-year-old graduate, a 35-year-old mid-career professional, and a 55-year-old with aging parents are different frustrations, and lumping them together into a single national mood is a mistake.

The 2040 he sketches is a country where digital governance has done what paper-based enforcement could not — surface the hidden wealth, narrow the grey economy, weaken the patronage networks that have run Pakistan since partition. The MENAP block has become an economic zone with a shared currency pegged to whatever the new Western reserve asset is. Pakistan supplies consumption and food productivity, Saudi supplies energy, Turkey supplies the manufacturing and the bridge to Europe. AI handles enforcement of the rules. The K-12 system is gone, replaced by smartphone-native learning. The intelligence that was previously invisible because of the language barrier is finally legible to global capital.

He is explicit that this is speculative. “We’ll see. I mean, this is all speculation. I have no idea how this evolves.” But the chips, he argues, are in Pakistan’s favour for the first time in a long time — not because of anything Pakistan has done, but because the global cycle is shifting and the country is sitting in the right geography at the right moment. The previous comparable moment was 1945. The job, this cycle, is not to miss it.

Muzamil closes by thanking Aftab for being willing to state the thesis on camera, which he notes most analysts are not. “In a turbulent environment, people are quick to judge,” he says. “Off camera you get that a lot. On camera, it takes a bit of strength.” That, in the end, is what makes this the third installment of a conversation worth following — not the predictions themselves, but the willingness to keep updating them in public as the data comes in.