Pakistani experts warn of serious economic ripples

The killing of Iran's supreme leader Ali Khamenei in US-Israeli strikes could have serious global consequences, experts say, warning that it is particularly unsettling for Iran's neighbors such as Pakistan.

"There is great sorrow and concern (in Pakistan). The war seems to be intensifying," said Salman Bashir, former foreign secretary of Pakistan.

"It could reshape the entire Middle East, affect the world economy, and could last a long time. Its geopolitical consequences could be severe," Bashir said.

Violent demonstrations against the United States broke out across Pakistan following the killing of Khamenei on Saturday, and intensified over the past few days. The protests have resulted in at least 25 deaths and numerous injuries, according to an AFP tally published on Monday.

Clashes erupted at the US Consulate General in Karachi, Pakistan's largest city, on Sunday as demonstrators attempted to storm the facility. The same day, protesters attacked the US Consulate in Lahore, before police thwarted the demonstrations.

Pakistan's Prime Minister Shehbaz Sharif expressed his condolences to the deceased in Iran on Sunday. "The Government and the people of Pakistan join the people of Iran in their hour of grief and sorrow and extend the most sincere condolences on the martyrdom" of Khamenei, Sharif wrote on X.

"Pakistan also expresses concern over (the) violation of the norms of international law. It is an age-old convention that the Heads of State/Government should not be targeted," he added.

Analysts said the protests were caused by uncertainty in people's minds following Khamenei's death.

Khalid Taimur Akram, executive director of Pakistan Research Center for a Community with Shared Future in Islamabad, said tensions in the Middle East, if escalated, will severely affect Pakistan.

While Pakistan is not directly involved in these conflicts, the economic and political effects can still be profound, Akram said.

Noting the closure of the Strait of Hormuz, he said, "This will result in a hike in fuel prices, electricity will be more expensive, making the daily lives of people more difficult."

It will also affect many Pakistanis working in the Middle East, who could lose jobs or face difficulties, reducing the remittances they send back home, he added.

Pakistan is one of the largest trading partners of the Gulf countries, Akram said. "Considering the current scenario, it can be said that if the conflict escalates, the whole world will suffer."

Shujaat Ahmed, an independent economic analyst in Pakistan, said the economic effect of Khamenei's killing in the short term will be on inflation, but the long-term effect will depend on the duration of the conflict.