AKD Securities Limited Equity Research – Daily Report

Karachi, January 10, 2019 (PPI-OT): Pakistan Strategy: US-Pak ties take a turn for the better

Political transitions remain flashpoints for Pak-US ties, where the current occupant of the White House has a unique, overtly transactional approach to foreign relations (USMCA negotiations, US-China relations, Khashoggi incident) which seem to be turning favorable towards Pakistan

Awaiting clarity on key measures undertaken for improved relations, we see a range of pro-Pakistan statements from US policymakers comingled with developing security dynamics on the ground in Afghanistan, where President Trump has set out to fulfil a campaign promise, US troop withdrawal from Afghanistan (longest US deployment in history)

Detailing a timeline of the fluid dynamics prevailing in Pak-US ties since the Trump presidency which senior US administration officials and the President have employed in dealing with Pakistan, where we believe our regional clout (improving ties with Iran, Russia, Afghanistan, China) makes us increasingly relevant in maintaining status quo

Investors are likely to disregard rhetorical developments (from both sides) in favor of concrete actions, where key litmus tests include developments surrounding the IMF, FATF and any possible Washington-Islamabad summit delivering additional catalysts for FDI, FPI, and non-binding arrangements.