GEOPOLITICAL INFLUENCES AND SUPPLY CHAIN RESILIENCE: EVIDENCE FROM PAKISTAN’S MANUFACTURING SECTOR

Abstract

Geopolitical tensions such as trade wars, regional conflicts, and regulatory pressures have disrupted global supply chains, rendering them vulnerable, particularly in emerging economies like Pakistan. While Pakistan benefits from initiatives such as the China Pakistan Economic Corridor (CPEC) due to its geostrategic position, it also faces risks from supplier dependence, geopolitical volatility, and regulatory compliance pressures, including European Union ESG standards—highlighting the need for more resilient supply chains. This study examines how supplier dependence, regional integration, geopolitical risk exposure, and regulatory compliance pressure influence supply chain resilience in Pakistan’s manufacturing sector, focusing on businesses in Karachi and Lahore. Using a cross-sectional quantitative design, data from 144 managers across industries were analyzed through PLS-SEM. The model explains 60.8% of the variance, with supplier dependence emerging as the strongest predictor, followed by regional integration and regulatory compliance pressure, while geopolitical risk exposure showed a lower-than-expected effect. Grounded in Dependency, Regional Value Chain, Realist, and Institutional theories, the study offers practical guidance for managers and policymakers to diversify supplier networks, enhance regional trade, strengthen risk monitoring, and invest in compliance infrastructure, while acknowledging sample size and self-report bias limitations.