As the world enters the second decade of the 21st century, the global political and economic structures are being reshaped in significant ways. The previous system was the outcome of a major conflict, the Second World War.

It was dominated by the country that played a decisive role in defeating the Nazis in Europe and the Japanese in East Asia. The system that emerged had institutional structures in the areas of economics and international politics. In both the United States, the victor in the Second World War, was the leader. It was challenged for a while by the Soviet Union but its collapse in 1991 left it as the sole superpower.

Some analysts, most notably Francis Fukuyama, labelled this development the end of history, arguing that with communism beaten back so decisively, the world would proceed in one direction. Liberal democracy and capitalism would be the accepted ideologies for managing the political and economic systems.

This triumphalism lasted for about a decade. Two far-reaching developments took place in the first decade of the present century. On Sept 11, 2001, 19 terrorists belonging to an obscure Islamic group not much known in the West struck the United States destroying the twin towers of the World Trade Centre in New York and badly damaging the Pentagon near Washington. Almost 3,000 people were killed, the largest loss suffered by the US on its mainland since the civil war. The US responded by first invading Afghanistan and later Iraq, two Muslim countries in the heartland of Islam.

Was the clash of civilisation predicted by the political scientist Samuel Huntington, asked many analysts? And then six years later the US economy began collapsing and for several months it appeared that the country along, with the rest of the West — perhaps also parts of the emerging markets — was heading towards the kind of economic collapse seen during the years of the Great Depression.

It was in the midst of these crises that the American electorate chose a new president, Barack Obama, sending to the White House the first black American to occupy that hallowed space and the one who won the election promising both change and hope. He brought the first while the second has still not manifested itself. While the US was dealing with these challenges, China began what in an earlier work I called the country’s “second economic rise”. President Obama has reacted to the arrival of this challenger in the field of economics in a surprising way. Rather than attempting to contain China as most of his predecessors would have done, he has expressed a strong desire to work with this new challenger to reshape the global economic order.

One important point that should be made at this stage is that this time around, the global structure is being reformulated as a result mostly of economic developments, not because of the end of a military conflict when power passed from the vanquished to the victorious. This certainly occurred after the end of the Second World War. It was also military defeat that led to the change in the political order in the Middle East when the victors carved up the Ottoman Empire into many pieces with unanticipated consequences. This time the impetus for change is coming from economic developments.

The effort to change and transform the world was begun in some earnestness in November last year when the new American president paid his first official visit to East Asia. What emerged from this visit was a new three-tier system of global governance with America and China at the top, the G20 in the middle and the rest of the world at the bottom of the arrangement. Is this a sustainable arrangement or will it be compromised from within by the powers who have been given a lesser role to play than they believe is their due? Will the new structure be able to deal with some of the area-specific problems such as the rise of extremism in the Islamic world that threatens world peace and prosperity or is it important to add to it some side structures?

As suggested in an earlier article, one important component of the developing global structure is the evolving relationship among four countries: China, India, Pakistan and the United States. Three of these countries are in Asia, the fourth is still the only superpower in the global economic and political systems. Three of these countries are among the five largest economies in the world.

Two of them — China and India — are by far the most rapidly growing large economies in the world. They are also the only two countries in the world with populations of more than a billion people each. Given that, why should Pakistan, an underperforming part of the developing world and a country beset with seemingly intractable economic problems, be included among the other three to define a quadrilateral relationship? This is a fair question to ask and one not too difficult to answer.

For a number of reasons, some of them related to the several models of economic development pursued by Pakistan over the last several decades, the country has created an environment that encourages a significant number of youth in its very young population to adopt extremist ideologies as a way of leading their lives. In 2009, extremism and associated acts of terrorisms took a heavy toll on the economy. There was also a heavy loss of life: more than 600 people were killed in the last three months of the year in dozens of terrorist acts attributed to the activities of extremist groups, especially the Tehrik-i-Taliban Pakistan.

The rise in terrorist activity can be attributed to economic failure especially the inability of the economy to create jobs for the young in the more backward areas of the country. There is a fear that if Pakistan’s economic situation continues to deteriorate it could have adverse consequences not only for the country but also far beyond its borders. One reason for thinking in terms of an arrangement encompassing these four countries is to pull back Pakistan from the abyss towards which it seems to be headed.

Dawn