MARKET PERSPECTIVE

By J Mulraj

Jul 25-31, 2026

The Machinations of Geopolitics

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The 18th century Prussian General, author and military thinker, Carl Von Clausewitz, said ‘tactics teaches the use of armed forces in the engagement; strategy, the use of engagements for the objects of the war’. Sun Tzu, a 6th century Chinese army General and author of The Art of War, said “All Warfare is based on Deception”.

If this report in The Times of Israel is accurate, all three were used by Pakistan’s Chief of Defence Forces, Asim Munir, when he got into an agreement with IRGC Chief, Ahmad Vahidi, in late March 2026, to transport Iranian oil, which was sanctioned, through Pakistan, for mutual benefit. Apparently, as per the article, Munir also leveraged the agreement to ward of missile attacks by Iran on Saudi Arabia, a financial backer of Pakistan, which held for three months.

If the assertion is true, it would be up to Donald Trump to investigate. Because Pakistan, under Munir, had acted as peacemaker to broker a ceasefire deal, signed in Islamabad on June 17, 2026. Under it, Iran committed to the opening of the Strait of Hormuz for peaceful commercial traffic. Also to permit IEA inspectors to inspect it’s nuclear facilities. The US committed to lifting its naval blockade of Iranian ports within 30 days, and to work on a framework for releasing the $ 24 b. of frozen Iranian funds.

The deal lasted 3 weeks breaking down completely by July 7-8. However, during that time, the lifting of the blockade allowed Iran to export 60 million barrels of oil worth, at the average price of $ 85/b., a whopping $ 5.1 billion. If the report in Times of Israel is to be believed, Pakistan was running with the hare and hunting with the hounds. Now that Pakistan is seeking a $ 10 b. credit facility () may be a good time for USA to ask if the article was correct.

There s an imminent danger of the Iran conflict spreading into a wider one. Ukraine fired This week, on July 25, Ukraine launched a long range drone attack on an Iranian commercial ship in the Caspian Sea, killing one, and injuring three sailors. Ukraine, which hasn’t declared war on Iran, accused Iran of carrying military equipment on the ship, meant for Russia, with whom it is at war. Iran has supplied a lot of its Shaheed drones to Russia which were used in its war with Ukraine. Iran’s Foreign Minister, Aragchi, says this is against the UN Charter, even though Iran, itself, is attacking Gulf countries with drones and missiles, accusing them of facilitating attacks on it.

Students of history can realise that this is exactly how WW I began, after a Serbian nationalist assassinated Archduke Franz Ferdinand of Austria-Hungary. Russia, which had an alliance with Serbia, mobilised its army to protect it. Germany, an ally of Austria-Hungary, declared war on Russia, drawing in France, which was allied with Russia. Germany invaded neutral Belgium, a short cut to France which it was trying to attack. This drew in Britain, an ally of Belgium. WW I resulted, ultimately, in the death of 20 million people, and injury to 21 million. Half of those dead were civilians.

That’s the tragedy and waste of war, waged by those driven by a lust for domination, greed and myopia.

On the flip side, there have been a few technological achievements to generate optimism.

China has used thorium-232 and a small amount of enriched uranium which are then dissolved in a liquid mixture of high-temperature fluoride salts. This molten salt, thorium, which is plentiful in China (and in India), absorbs the neutrons from the starter fuel, and transmutes into uranium-233, which is a fissionable material. The reactor is called TMSR-LF1, short for Thorium Molten Salt Reactor, Liquid Fuel 1. It is, as of now, on a test scale. .

India has huge thorium reserves, and Dr Homi Bhabha has developed a 3 stage process to develop it. We have reached Stage 2, developing a PFBR (prototype fast breeder reactor), at Kalpakkam, Tamil Nadu, which breeds more nuclear fuel than it uses. China is ahead in the game, having gone on a different path.

Once these plants reach commercial scale, the world can obtain a limitless supply of cheap, clean energy. With energy guzzling demands from AI, this would, indeed, provide oxygen for global economic growth.

Another welcome development is the launch, by UAE, of the first fully integrated AI powered judicial system.

This AI powered judicial system will offer * automated analysis of case files, * faster case processing, * rapid retrieval and comparison of judicial precedents, * enhanced decision making support without compromising judicial autonomy, and other benefits. This is something PM Modi must immediately move to introduce in India. India has excellent relationship with UAE and which will happily collaborate with it.

Speedy justice is needed for everyone. Even the wealthy and influential Sabeer Bhatia, who founded hotmail, has waited over two decades, since 2012, to get delivery of a luxury apartment in India. This irreparably damages India’s reputation in realty and in judiciary.

In some fields India has made commendable advances. Such as the development, by DRDO, of a 350 kg thrust expendable turbojet engine. An expendable engine can be used once, like in a cruise/hypersonic missile, or in a kamikaze drone.

Last week the BSE Sensex closed at 78094, for a weekly gain of 2035 points.

As these columns have mentioned, a negotiated end to the Iran war seems unachievable because (a) Iran is unwilling to give up its nuclear plans or allow outside inspection, whilst USA insists on it and (b) there is no unified command structure with IRGC and the elected Government being two power centres. A military cum economic pressure through blockades, is the more likely course, but is not working. Especially if evacuation of oil through land routes is enabled and Trump turns a blind eye, for whatever reasons, to it.

So if the impasse continues, oil prices and interest rates would rise.

For how long an the bull charge uphill?

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Comments may be sent to: jmulraj@asiaconverge.com