Powerus and Pakistan: The optics problem with a Trump-linked deal
Powerus has signed a memorandum of understanding with Field Marshal Asim Munir, Pakistan’s de facto leader, whom Donald Trump has called his “favourite field marshal”, that includes an initial drone-related order, co-founder Brett Velicovich told Reuters on Wednesday.
Though there is nothing that establishes improper influence or a conflict of interest, the deal brings together enough political, military and commercial interests to make the optics unusually difficult to dismiss.
The latest agreement also arrives at a sensitive moment in US-Pakistan relations. President Donald Trump has cultivated a close relationship with Pakistan’s army chief Munir, while Islamabad has been pursuing American investment and defence ties without giving up its longstanding relationship with China. Powerus is now seeking to turn that diplomatic opening into a long-term commercial relationship. Pakistan had earlier signed a deal with a cryptocurrency firm linked to Trump’s sons and also offered Trump access to critical minerals.
A young company moving very quickly
Powerus’ MoU with the Pakistan Army includes an initial, undisclosed order for unmanned aerial systems. The company has declined to say what was ordered or how much it is worth. Pakistan’s military confirmed that a Powerus delegation led by co-founder Brett Velicovich met Munir to discuss defence procurement, production and long-term capacity building, although its statement did not mention the MOU.
Also read | US drone maker Powerus signs Pakistan Army MOU, gets initial order
The Financial Times reported that the agreement could go considerably further than an initial sale. It is intended to provide a framework for joint ventures to localise manufacturing in Pakistan and could involve drone and interceptor products for the military. Powerus says it is exploring ways to build technology in Pakistan, with chief executive Andrew Fox describing the relationship as something more than a one-off transaction.That is an ambitious trajectory for a company founded only last year as Autonomous Power Corporation.
Powerus has been assembling a portfolio of drone and counter-drone businesses and has raised substantial private capital. Its planned combination with Nasdaq-listed Aureus Greenway Holdings, a golf-course holding company, is now well advanced.
The SEC filings show that the relationship with the investment vehicle American Ventures linked to Trump’s sons, Trump Jr. and Eric Trump, is more than a casual association. American Ventures provided Powerus with a $5.55 million bridge financing in February, accompanied by warrants. The merger documents identify American Ventures as a shareholder of Aureus.
The Trump connection
Donald Trump Jr. and Eric Trump are investors in the company through American Ventures. Reuters reported that American Ventures is expected to have a 9.9% beneficial ownership stake in the combined company after the merger. Trump Jr.’s spokesman says he is a passive investor who has no role in Powerus’s management or procurement and had no prior knowledge of the Pakistan deal. The White House has said there are no conflicts of interest.
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There is no evidence at present that shows that either Trump son intervened in the Pakistan transaction. But passive ownership does not make the optics disappear.
The president’s children have an economic interest in a company whose value can be affected by government and foreign-government business. Powerus is simultaneously building relationships with the US military and foreign defence customers at a time when the Trump administration is making drones a national-security priority.
That was already attracting scrutiny before Pakistan entered the picture.
In March, Senators Elizabeth Warren and Richard Blumenthal questioned the Pentagon about safeguards against conflicts involving Trump family investments and defence contracts, specifically citing Powerus. Warren later raised questions after Powerus received additional Air Force business. The senators argued that officials could have incentives to favour companies associated with the president’s family even without direct intervention.
The business itself has genuine momentum
It would also be wrong to portray Powerus as a company that exists only because of the Trump connection. The company was founded by former US Army Special Operations veterans and has developed drone and counter-drone systems for military and commercial applications. The business includes aerial systems, counter-drone technology and protection of critical infrastructure.
There is evidence of genuine market demand. Reuters reported in August that Powerus had signed a roughly $22.3 million commercial contract to supply counter-drone technology for Middle Eastern oil and gas infrastructure. The identity of the customer and deployment sites were not disclosed.
The Financial Times also reported that Powerus produces about 3,000 drone interceptors a month and has been expanding production. It has licensed Ukrainian drone technology and acquired companies involved in lower-cost autonomous systems. The company says it wants to increase interceptor production sharply.
Powerus has received a US Air Force contract with a reported ceiling of $90 million. So there is a plausible commercial explanation for Powerus’s growth.
The Gulf connection
The optics became more complicated in April. AP reported that Powerus was pitching its Guardian interceptors to Gulf countries while they were under attack from Iran. The company was demonstrating its systems in several countries but declined to identify them. AP noted the obvious overlap. The president whose administration was conducting the war was also the father of two investors in a company seeking business from countries affected by that war.
Bloomberg separately reported based on information from sources that Powerus had discussed selling weapons to the UAE as Abu Dhabi sought to strengthen its defences against Iranian attacks. Those talks had not produced a final deal at the time.
Again, none of this establishes that Powerus received business because of the Trump connection. It does establish a recurring pattern in which geopolitical developments involving the US government create commercial opportunities for a company in which the president’s sons have a financial interest.
The Pakistan angle
Pakistan is not simply another foreign customer. China accounts for roughly 80% of Pakistan’s defence imports by volume. Powerus presents its proposed relationship as a way for Pakistan to develop an alternative source of drone technology and eventually local manufacturing.
At the same time, Pakistan is not choosing between Washington and Beijing. Reuters has reported Islamabad is seeking an expansion of its Chinese currency-swap arrangement while also pursuing US financing and deeper economic ties with Washington. Pakistan’s finance minister described the relationship as an “and-and” strategy.
The political context is therefore important. Munir has developed an unusually close relationship with Trump, whom he has publicly praised, while Pakistan is trying to extract economic and strategic benefits from renewed US engagement.
Earlier this year Pakistan also signed an MOU with SC Financial Technologies, an affiliate of World Liberty Financial, the Trump-linked cryptocurrency venture. The agreement concerned exploration of a dollar-linked stablecoin and digital-payment infrastructure. Zach Witkoff, a World Liberty co-founder and the son of Trump’s special envoy and close adviser Steve Witkoff, had visited Pakistan.
Each of the transactions mentioned above may have an ordinary commercial explanation. But together they create a perception of unusually close commercial engagement between Pakistan and businesses connected to Trump’s family and inner circle.
