Pakistan’s ambition to supply rare earths and critical minerals to the United States is hindered by issues in domestic security, political stability, and regulatory clarity, as per a report in The Friday Times. Despite having geological potential in areas like Reko Diq, Balochistan, and Khyber Pakhtunkhwa, challenges persist due to security threats and political instability. Recent incidents, including attacks by Baloch Liberation Army and activities of Tehreek-e-Taliban Pakistan and Islamic State Khorasan Province, have raised concerns about safety in these regions.
The report highlights how militancy, such as the Tira Valley displacement linked to counter-TTP operations, impacts the mining environment. Investor sentiments have been affected by the escalation of violence in Balochistan, with Chinese investors facing challenges. To attract more capital, Pakistan needs to stabilize existing commitments and address security issues, especially for Chinese personnel. The country should focus on transparent policies and resolving energy payment disputes to reassure Beijing while also engaging with Washington.
Limited internationally verified data on commercially viable rare earth reserves necessitates further exploration and certification before large-scale production can be viable. The report emphasizes the need for regulatory clarity in mining operations, which requires long-term stability in policies. Political disputes between provincial and federal authorities pose additional barriers to investment inflows, creating uncertainty for investors. The report warns that if security conditions worsen, Saudi Arabia’s interest in Reko Diq may not progress further.
