Akhtar believes Azam has become an insecure captain as the Pakistan team management doesn't give him the liberty to follow his instincts.
Notably, the visitors failed to defend 195 runs in the second T20I as England sealed a comprehensive victory with Eoin Morgan leading from the front.
"If we don't give Babar the liberty (as captain), it will remain a case of a bio-insecure bubble. Every member of the team is insecure. He (Azam) isn't even sure if he wants to stay on as captain," Shoaib said on his YouTube channel.
The likes of Babar Azam and Fakhar Zaman got off Pakistan to a good start.
Later on, Babar propelled Pakistan past 100 alongside Hafeez.
Hafeez's brilliant 69 (36) powered Pakistan to 195/4 (20).
In reply, England's top-order dented the Pakistani pacers right from the beginning.
Skipper Eoin Morgan's 66 (33) helped them chase the total with five balls to spare.
Despite putting up a substantial total, Pakistan lacked the tactics to produce breakthroughs while defending.
"Babar Azam looks like a lost cow to me. He is out there not knowing what to do," Shoaib added.
"He should make his own decisions and accept victories and defeats as they come so that he learns on the job and becomes a better captain for the future."
Shoaib feels Babar himself needs to accelerate in T20Is.
"Babar needs to understand that chances are coming your way. But it's not going to happen forever," Shoaib stated.
"He plays at a strike-rate of 127, but he can accelerate to 135. The way Morgan, Malan and Bairstow play, they look in command at the crease. Our boys look scared," the former cricketer added.
Babar Azam smashed a 44-ball 56 in the second T20I. This was his 14th T20I fifty.
During the innings, Babar also surpassed the 1,500-run mark in the format, becoming the fourth Pakistani batsman to do so.
The Pakistan skipper also registered his second fifty against England.
However, it remains to be seen if he could lead Pakistan to victory in the third T20I.
Love Sports news?
Subscribe to stay updated.