Last week, the U.S. State Department imposed sanctions on the Beijing Research Institute of Automation for Machine Building Industry for what it said was the company's moves to procure equipment for testing Pakistani rocket motors.
The new penalties also targeted the three Chinese companies Hubei Huachangda Intelligent Equipment, Xi'an Longde Technology Development and Universal Enterprise, Chinese citizen Luo Dongmei and Pakistan-based Innovative Equipment, for transferring equipment that is controlled under missile technology restrictions.
Washington said the equipment was for Pakistan's Shaheen 3 and Ababeel ballistic missiles. The Shaheen 3 is a land-based medium-range missile with a range of 2,750 kilometers that can reach archrival India and deep into the Middle East. The Ababeel is a land-based tactical ballistic missile with a normal range of 1,800 kilometers.
"This is part of the U.S. larger strategy of economic coercion aimed at containing the Chinese rise rather than aimed at Pakistan," Syed Muhammad Ali, an Islamabad-based security expert, told Nikkei Asia.
There is little evidence that China is taking part in Pakistan's nuclear-capable ballistic missile program, Ali added.
"Pakistan-China defense cooperation is related to conventional arms to meet its air force, army and naval requirements and not based on ballistic missiles which Pakistan has indigenously developed," he said.
Islamabad immediately rejected the sanctions as biased and politically motivated.
"It is widely known that some countries, while claiming strict adherence to nonproliferation norms, have conveniently waived licensing requirements for advanced military technologies to their favored states," said Mumtaz Zahra Baloch, spokesperson for Pakistan's Ministry of Foreign Affairs.
China is Pakistan's largest source of major arms abroad. Between 2000 and 2023, Pakistan received 44% of all major arms exports from China, according to the Stockholm International Peace Research Institute.
Islamabad and Beijing are jointly developing a JF-17 Thunder aircraft and the Al-Khalid main battle tank. Pakistan's Haider battle tank is a variant of the Chinese VT-4. Pakistan has procured 25 J-10C aircraft plus Wing Loong II armed drones from China and ordered eight Hangor-class attack submarines, among other equipment.
While the newest sanctions may not hurt Pakistan's ballistic missile program in the short term, they may leave the country with few options going forward, some experts said.
"Pakistan has a special defense relationship with China, and it has no other partner to turn to for its missile development needs if Beijing continues to be targeted with punitive U.S. measures," said Michael Kugelman, director of the South Asia Institute at the Wilson Center, a Washington-based think tank.
The dominance of the U.S. dollar in global markets will squeeze Chinese companies into complying with the measures, said Ayesha Siddiqa, a senior fellow with the Department of War Studies of King's College London.
"This dominance can force Chinese firms to be more cautious when dealing with Pakistan in the future," she said.
The moves by Washington could also draw Pakistan deeper into the China-U.S. rivalry.
"It's important to view these U.S. actions in the context of great power competition and the central position that Washington's competition with Beijing occupies in U.S. foreign policy," Kugelman told Nikkei.
"Over the longer term, [Pakistan-China defense] relations could face challenges for very practical reasons if relentless U.S. sanctions on China's missile industry make it more difficult for Beijing to provide the types of weaponry on which Islamabad has long relied," he added.
Pakistan may be able to identify new suppliers down the road, but that could take time, "and given Pakistan's poor record on proliferation in the past, it may have trouble finding new partners," Kugelman said.
Siddiqa at King's College, who was previously director of Pakistan's naval research, said the measures were likely made with an eye to U.S. allies in the Indo-Pacific region.
"The U.S. would like to secure and consolidate its partners in the region from the threats of ballistic missile attacks," she added.