The clues are piling up: counterterrorism wins, FATF progress, cozy U.S. chats, and even Abraham Accords buzz. Pakistan’s eyeing a new direction, and the U.S. has a golden opportunity to jump in. For Pakistanis, this isn’t just diplomacy—it could mean stability, jobs, and a brighter future. As Jack Rosen writes, “Time will tell whether Pakistan walks this new path. But if the United States steps forward, it may find in Pakistan a more reliable, more responsive partner than once thought possible.”
Pakistan’s foreign policy has long been a balancing act—navigating ties between China and the United States, civilian government and military leadership, and domestic pressures versus global expectations. Yet recent developments hint at a subtle realignment toward Washington, with potentially far‑reaching implications for South Asia and beyond.
A Shift in Counterterrorism Cooperation
In his 2025 State of the Union address, President Trump “applauded Pakistan for capturing a high‑profile ISIS operative — responsible for the deaths of 13 U.S. service members in Kabul,” signaling renewed U.S. confidence in Islamabad’s counterterrorism efforts (NY Daily News). That praise was more than diplomatic courtesy; it underscored a willingness in Washington to view Pakistan as a credible security partner once again.
High‑Level Engagement
Shortly thereafter, Trump met Gen. Asim Munir, Pakistan’s influential army chief, in an unprecedented dialogue covering joint counterterrorism initiatives, as well as economic investment and infrastructure cooperation. When tensions flared along the India‑Pakistan border, Trump personally intervened to de‑escalate the standoff—an unusual step that highlighted both Pakistan’s regained strategic relevance and America’s readiness to play a direct role in South Asian stability.
Economic Realities and FATF Delisting
Amid economic volatility and stalled Chinese investments in the China‑Pakistan Economic Corridor (CPEC), Pakistan seized an unexpected opportunity: removal from the Financial Action Task Force (FATF) grey list. After implementing “substantial reforms” targeting terrorist financing and money‑laundering, Islamabad secured its delisting earlier this year—a milestone that has received scant attention in Western media but holds profound significance for global investors (NY Daily News).
“Pakistan’s reforms have directly contributed to degrading transnational terror networks and curbing illicit financing—outcomes vital to regional stability and U.S. homeland security.”
With inflation easing, a new IMF standby facility approved, and early signs of consumer confidence returning, Pakistan could become a prime destination for capital inflows—especially if Washington publicly endorses Islamabad’s FATF compliance. Such backing would not only reward Islamabad’s efforts but also bolster market trust and counterbalance China’s economic sway with more equitable, market‑driven alternatives.
The Abraham Accords: From Unthinkable to Achievable?
Perhaps the most transformative possibility on the horizon is Pakistan’s potential participation in the Abraham Accords. A few years ago, normalizing ties with Israel would have been political suicide for any Pakistani leader. Yet the landscape is shifting:
- Saudi Momentum: Saudi Arabia is reportedly nearing its own normalization deal with Israel.
- Backchannel Diplomacy: Quiet talks between Israel and various Muslim‑majority nations are accelerating.
- Economic Incentives: The U.S. is dangling attractive packages—advanced defense technology, new trade frameworks, and diplomatic capital—in return for normalization.
“Normalizing ties with Israel could unlock access to advanced U.S. defense technology, open new trade frameworks, and deliver long‑sought diplomatic capital,” framing the Accords as a pragmatic strategy rather than a betrayal of longstanding principles.
Critics will charge that public sentiment in Pakistan is still strongly pro‑Palestinian. However, should a regional heavyweight like Saudi Arabia or Indonesia take the first step, Pakistan’s calculus could shift dramatically. Coupled with firm economic guarantees and a narrative emphasizing strategic relevance rather than ideological abandonment, normalization might gain unexpected traction.
Managing the India Factor
India remains a crucial U.S. partner—a relationship largely driven by shared concerns over China. Yet Washington must avoid a zero‑sum approach in South Asia. By nurturing distinct yet complementary ties with both New Delhi and Islamabad, the U.S. can advance broader regional stability and unlock new avenues for cooperation.
Looking Ahead
The signs are clear: counterterrorism cooperation, FATF compliance, renewed high‑level engagement, and even talk of joining the Abraham Accords. Whether Pakistan ultimately walks this new path will depend on both domestic will and American leadership. If Washington steps forward now, it may find in Islamabad a more reliable, more responsive partner than ever before.
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