Pakistan military eyes key role developing giant copper and gold mine

In this file photo, Pakistani armed forces in tanks take part during the Pakistan Day military parade in Islamabad, Pakistan, March 23, 2016. (REUTERS)
Updated 12 March 2019
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Pakistan military eyes key role developing giant copper and gold mine

  • Buried at the foot of an extinct volcano near the frontier with Iran and Afghanistan, Reko Diq has world’s biggest untapped copper and gold deposits
  • The project boasts 5.9 billion tons of ore inviting foreign investors

ISLAMABAD: Pakistan’s military is taking a key role in the development of one of the world’s biggest untapped copper and gold deposits, which is currently stalled by a multi-billion dollar legal wrangle with foreign mining firms, multiple sources familiar with the situation said.
The Reko Diq mine has become a test case for Prime Minister Imran Khan’s ability to attract serious foreign investment to Pakistan as it struggles to stave off an economic crisis that has forced it to seek an International Monetary Fund bailout.
Ten current and former provincial and federal government officials and mining sources familiar with the project in the Baluchistan region say the military has become the most important voice on the future of Reko Diq, which it sees as a strategic national asset.
The military will not only be in a position to decide which investors develop the deposit, but an army-controlled engineering firm, Frontier Works Organization (FWO), is positioning itself to be a member of any consortium involved, these people said.
“This has been taken over by GHQ,” said a senior Baluchistan government official, referring to the Pakistan army’s General Headquarters in the garrison city of Rawalpindi.
In a statement in response to Reuters’ questions about its role in Reko Diq, the military spokesman’s office said: “(The military) may only participate in government’s plan of development of Reko Diq, as per national requirements.”
But it acknowledged that FWO, best known for building roads through Pakistan’s rugged and lawless border regions, has developed “substantial” mining capability in recent years and would be interested in taking a role in the project.
“If an opportunity arises of participating in developing Reko Diq, FWO may work at par with other competitors (or) companies provided the project is financially viable (or) suitable,” the statement said. When asked, a spokesman declined to elaborate on the statement.
Pakistan’s Information Minister Fawad Chaudhry said civilian authorities in the insurgency-hit southwestern province of Baluchistan were in charge of Reko Diq and, along with Khan, would take a decision, but added that the military “and all other stakeholders are obviously important players.”
FWO referred questions to the military spokesman’s office. Khan’s spokesman Iftikhar Durrani said Baluchistan province was in charge of Reko Diq, and referred questions to the provincial government and the military spokesman’s office.
The manoeuvring behind the project shows how the military, which has historically dictated Pakistan’s security and foreign policy, is leveraging its sway over the civilian government at federal and provincial level to carve a growing role in the nation’s business affairs.
“The military has taken a front seat,” said Ayesha Siddiqa, author of the book “Military Inc.,” which analyzes the army’s business interests and influence in Pakistan.
“They’ve understood that the economy is important for having a strong military,” she said. “Control of the economy also gives the military a handle over expanding their business interests.”
TALKS
Buried at the foot of an extinct volcano near the frontier with Iran and Afghanistan, the mine’s development has long been delayed by a dispute with previous investors in the project, Canada’s Barrick Gold and Chile’s Antofagasta.
The government is urgently trying to settle the dispute as a World Bank arbitration tribunal, which ruled against Pakistan in 2017, is in the next few months expected to announce how much in damages the country must pay to the foreign firms, who are claiming more than $11 billion.
The dispute relates to the withholding of a mining lease.
Islamabad is also trying to find new partners to invest in the project.
But any new investors will need the blessing of Pakistan’s military, according to government officials and mining sources.
State-run companies from resource-hungry China have long coveted Reko Diq and more recently Saudi Arabia has shown interest, according to Pakistani officials.
Some Western diplomats say the Reko Diq dispute has been a significant foreign investment deterrent, with international businesses unnerved at how Pakistan dealt with the companies that had pledged to invest $3.3 billion to develop the country’s then-biggest mining project.
Barrick Gold and Antofagasta, whose joint venture Tethyan Copper Company (TCC) discovered vast mineral wealth in Reko Diq, say they had invested more than $220 million by the time the Baluchistan government, in 2011, unexpectedly refused to grant them the critical mining lease needed to keep operating.
Pakistan argued its move was legitimate because TCC’s feasibility study was incomplete and the country’s Supreme Court voided the deal in 2013. But in 2017 the World Bank’s International Center for Settlement of Investment Disputes (ICSID) ruled against Pakistan.
TCC did not respond to requests for comment and Antofagasta and Barrick Gold both declined to comment. Reuters could not determine whether either company would be willing to return to the project.
FOREIGN INVESTORS
The last serious attempt at settling the Reko Diq case was scuppered in 2016 by the military, which vetoed paying hundreds of millions of dollars to TCC, according to a senior Baluchistan official and two former senior officials in Islamabad.
But the military has since changed its stance and is more open to a settlement with TCC, according to a lawmaker close to the military and a source close to Prime Minister Khan. The military was also involved in appointing Pakistan’s current legal team.
In response to a Reuters question about blocking the previous settlement effort, the military said: “Let’s see how the case progresses.” It did not elaborate or comment on whether it was playing any role in the latest negotiations.
Some mining experts say a likely solution would be for a new investment consortium to pay the settlement fee on behalf of cash-strapped Pakistan in exchange for future royalty fees or mining rights.
Information Minister Chaudhry said Pakistan was engaged in negotiations with “both” the current investors about a settlement and also potential new investors, with interest coming from the Middle East and Europe. He declined to name the potential investors.
Pakistani Finance Minister Asad Umar said in October that Saudi Arabia has inquired about investing in Reko Diq and another government official confirmed talks were ongoing.
Saudi Arabia did not respond to a Reuters request for comment on Reko Diq. During Crown Prince bin Salman’s visit to Pakistan last month, the kingdom pledged to invest $2 billion in mineral development projects, though the provisional agreements were vague and did not mention any specific projects.
China’s state-owned miner China Metallurgical Group Corporation (MCC), which operates the Saindak copper and gold mine close to Reko Diq, has been eyeing the bigger deposit for more than a decade, according to mining and MCC officials.
A few years ago Chinese state giant Norinco also made an approach, according to two sources familiar with Norinco’s offer.
MCC and Norinco did not respond to requests for comment.
When a mining company approached former general Abdul Quadir Baloch about Reko Diq around 2016, when he was federal minister for the frontier regions, he took their proposal not only to then-premier Nawaz Sharif, but also to the army chief.
“The military has to give a (security) guarantee to any company coming in to explore or exploit this project, so they are a stakeholder,” said Baloch.
The military declined to comment on Baloch’s assertions. Sharif, who has since been jailed on corruption charges, could not be reached for comment.
The army-run FWO does not have the funds or the expertise to develop the Reko Diq project, which boasts 5.9 billion tons of ore. But it could be part of a consortium alongside global miners who have the know-how to mine such a gargantuan deposit.
The military’s role in developing natural resources in Baluchistan also carries risks, however, analysts say.
Indigenous Baloch people view outsiders with suspicion, and their anger about Islamabad exploiting the province’s vast natural resources has been one of the key themes fueling a separatist insurgency that began around 2004.


In a first, Pakistan to host England, New Zealand and Zimbabwe women’s cricket teams in 2026/27

Updated 7 sec ago
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In a first, Pakistan to host England, New Zealand and Zimbabwe women’s cricket teams in 2026/27

  • Zimbabwe to tour Pakistan in Apri-May 2025, New Zealand to tour country in April 2027
  • Pakistan will travel to South Africa, Sri Lanka and the West Indies in 2026 for cricket contests

ISLAMABAD: Pakistan will host New Zealand, Zimbabwe and England women’s cricket teams for the first time in 2026 and 2027, the Pakistan Cricket Board (PCB) said this week, saying that the tours were part of the International Cricket Council’s (ICC) Future Tours Programme 2025-29. 

Zimbabwe women’s team will tour Pakistan in April-May next year while New Zealand will be visiting the country in April 2027, the PCB said in a statement. The English women’s cricket team will tour Pakistan in October 2027 while Bangladesh will be the fourth side to tour the country in October 2028. 

“Pakistan will host England, New Zealand and Zimbabwe women’s cricket teams for the first time as ICC announced Future Tours Programme 2025-29,” the PCB said in a press release on Monday. 

Eleven countries will participate in the fourth cycle of the ICC Women’s Championship being played from 2026-29 to directly qualify for the ICC Women’s 50-over World Cup in 2029, it said, adding that each team will compete against eight other teams in eight home and away matches. 

The fourth cycle of the ICC Women’s Championship, which will be played from 2026-29, will see 11 sides taking part in the event for direct qualification to the ICC Women’s 50-over World Cup in 2029. 

In the Women’s Championship, each team will compete against eight other teams, following the format of four home and four away series, similar to the current edition. Across 44 series, a total of 132 ODIs will be played, with each series consisting of three matches.

“The Future Tour Programme will see an ICC Women’s tournament taking place every year, starting with the ICC Women’s Cricket World Cup 2025 in India, the ICC Women’s T20 World Cup 2026 in England, the inaugural ICC Women’s Champions Trophy in 2027 and the ICC Women’s T20 World Cup in 2028,” the PCB added.

Pakistan will travel to South Africa in February 2026 and then play Sri Lanka in July of the same year as part of their away assignments, the board said. In November 2026, Pakistan will visit the West Indies while their final away series in the ICC Women’s Championship 2026-29 cycle will be in Ireland in June 2028.
 


Saudi Arabia, UAE invest $26.8 million in Pakistan in first quarter of current fiscal year

Updated 4 min 24 sec ago
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Saudi Arabia, UAE invest $26.8 million in Pakistan in first quarter of current fiscal year

  • Foreign investment surged by 48 percent in first quarter of current fiscal year
  • Pakistan, Saudi Arabia signed agreements worth $2.8 billion last month

ISLAMABAD: Pakistan’s foreign investment has surged by 48 percent during the first quarter of the current fiscal year, state-run media reported on Tuesday, with Saudi Arabia and the United Arab Emirates (UAE) contributing $26.8 million during the same period.

Pakistan formed the Special Investment Facilitation Council (SIFC), a hybrid civil and military body, in 2023 to fast-track decisions related to foreign investment in its key economic sectors such as agriculture, mining, minerals, tourism and others. The development took place as Pakistan grappled with a prolonged economic crisis that almost led the country to suffer a sovereign default before a critical $3 billion bailout by the International Monetary Fund (IMF) last year averted the crisis.

As per a breakdown shared by state broadcaster Radio Pakistan, China invested $404 million during the first quarter of the current fiscal year while Saudi Arabia’s investment was recorded at $ 1.8 million. The UAE, meanwhile, invested $25 million, Hong Kong $98 million, the United Kingdom $72 million and the United States $28 million in the same period, the state broadcaster said.

“A significant increase of forty eight percent has been seen in foreign investment in Pakistan in the first quarter of current fiscal year, reflecting the effective strategies of the Special Investment Facilitation Council,” Radio Pakistan said.

Pakistan’s Prime Minister Shehbaz Sharif visited Saudi Arabia and Qatar last week, where he held talks with the leadership of the two countries on enhancing cooperation in trade, investment and energy. Pakistani and Saudi businesses had signed 27 agreements and memorandums of understanding (MoUs) worth $2.2 billion in October. During Sharif’s visit to the kingdom last week, the two countries agreed to enhance that figure to $2.8 billion.

Meanwhile, the UAE is Pakistan’s third-largest trading partner after China and the United States. It is also an ideal export destination for the South Asian nation as the short distance between the two countries limits transportation costs and facilitates commercial exchanges.

Sharif has actively pursued economic diplomacy in the region in recent months, seeking more investments and enhancing trade and regional connectivity for Pakistan. The South Asian country has sought to leverage its position as a transit and trade hub connecting landlocked Central Asian countries with the rest of the world and also pushed for mutually beneficial economic partnerships with Gulf countries.


Security guard shoots and injures two Chinese nationals at Karachi factory — police

Updated 15 min 50 sec ago
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Security guard shoots and injures two Chinese nationals at Karachi factory — police

  • Incident follows two Chinese nationals killed in suicide bombing in Karachi last month
  • Beijing has recently publicly spoken out about security threats to its nationals in Pakistan

KARACHI: A security guard at a factory in the southern Pakistani city of Karachi shot and injured two Chinese nationals on Tuesday, police said, in an incident that is likely to put further strain on recently fraying relations between Islamabad and longtime ally Beijing.

China, breaking with tradition, has recently publicly spoken out against security threats to its workers and nationals living in Pakistan, where hundreds of them work on Beijing-funded projects linked to the over $60 billion China-Pakistan Economic Corridor (CPEC). 

Last month, two Chinese nationals were killed in a suicide bombing near the international airport in Karachi. In March this year, a suicide bombing killed five Chinese engineers and a Pakistani driver in northwestern Pakistan as they headed to the Dasu Dam, the biggest hydropower project in the country. In 2022, three Chinese educators and their Pakistani driver were killed when an explosion ripped through a van at the University of Karachi. A blast on a bus killed 13 people in north Pakistan in 2021, including nine Chinese nationals.

The latest shooting took place at a factory in Karachi’s SITE industrial area, after which two injured Chinese citizens were rushed to Liaquat National Hospital.

Deputy Inspector General of Police South, Syed Asad Raza, said the factory guard opened fire at the Chinese nationals after an argument. He did not name the factory, specify whether the Chinese nationals were employees there or what the argument was about. 

“According to preliminary investigation, the guard opened fire after a heated argument with the Chinese nationals, leaving two Chinese citizens injured,” Raza told Arab News. 

“Two Chinese nationals have been brought to hospital. Both are under treatment,” Dr. Amjad Rizvi, a hospital spokesman, told Arab News. 

Sindh Home Minister Zia ul Haq Lanjar has directed police to conduct a “thorough investigation,” his office said. 

Pakistan said in a joint statement last month it had agreed to increase security for Chinese citizens and projects in the South Asian nation, as Beijing called for urgent security measures following an escalation in militant threats in the country.

China has pumped billions of dollars into Pakistan over the years building infrastructure under the Belt and Road Initiative, while also running a strategic port and a major mine in the country.


Toxic smog wreathes India’s capital, Pakistan’s Lahore as winter nears

Updated 05 November 2024
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Toxic smog wreathes India’s capital, Pakistan’s Lahore as winter nears

  • Punjab government has blamed pollution wafting in from India for Lahore’s worsening air quality 
  • Authorities in Punjab have taken emergency measures in wake of unprecedented pollution levels

NEW DELHI: A toxic smog shrouded the Indian capital on Tuesday, driving air quality in some areas into the “severe” range ahead of winter, when cold air traps pollutants and brings a spike in respiratory illnesses.

The mix of smoke, emissions, and dust is an annual problem for authorities in New Delhi, with vehicles, construction dust, and smoke from farm fires in the adjoining northern states of Punjab and Haryana among the major contributors.

“The outlook for the subsequent six days: the air quality is likely to be in the ‘very poor’ to ‘severe’ category,” said the earth sciences ministry.

The city’s overall score on an air quality index kept by India’s top pollution authorities was ‘very poor’ at 384, the ministry added, and was likely to stay there until Thursday.

An index range of 401 to 500 falls into the ‘severe’ category, implying it affects healthy people, but is more serious for those already fighting disease.

Ministry data showed farm fires have increasingly swelled the pollution over the last three days, for a share of more than 23 percent on Monday, from about 15 percent on Saturday.

About a third of the city’s 39 monitoring stations showed a ‘severe’ score of more than 400 on Tuesday, said the Central Pollution Control Board (CPCB), well short of an air quality score of zero to 50 that it rates as ‘good’.

Swiss group IQAir also rated Delhi the world’s second most polluted city on Tuesday, after Lahore in neighboring Pakistan, where authorities also took emergency measures in the wake of Sunday’s unprecedented pollution levels.

The government in the eastern province of Punjab, home to Lahore, has blamed deteriorating air quality on pollution wafting in from India, an issue it has vowed to take up with its neighbor through the foreign ministry.


Pakistan, Uzbekistan businesses explore joint ventures in Tashkent meeting

Updated 05 November 2024
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Pakistan, Uzbekistan businesses explore joint ventures in Tashkent meeting

  • The business-to-business meetings spanned a variety of industries, including textiles, food processing, engineering and logistics
  • Pakistan is seeking to promote closer economic ties with regional and international allies to bolster its fragile $350 billion economy

ISLAMABAD: Representatives of more than two dozen Pakistani companies and over one hundred leading Uzbek enterprises met in Tashkent and discussed joint projects in diverse sectors, the Pakistani commerce ministry said on Monday.

The discussions took place at the Uzbek-Pakistani Business Forum, complementing the 9th intergovernmental commission meeting on economic cooperation between Uzbekistan and Pakistan, according to the Pakistani ministry.

These business-to-business (B2B) meetings spanned a variety of industries, including textiles, food processing, engineering and logistics, underscoring the shared commitment of both nations to explore collaborative business opportunities.

Addressing the forum, Pakistan’s Commerce Minister Jam Kamal Khan highlighted Pakistan’s investment-friendly environment and encouraged Uzbek businesses to consider collaborative projects in Pakistan.

"He emphasized that such interactions pave the way for deepened commercial ties and contribute to regional economic stability," the commerce ministry said.

Uzbekistan’s Minister of Investment, Industry and Trade Laziz Kudratov echoed these sentiments, welcoming Pakistani enterprises and emphasizing the Uzbek government’s commitment to fostering a supportive atmosphere for international partnerships.

"Initiatives like the Business Forum play a crucial role in propelling trade and investment forward, creating new opportunities for entrepreneurs," he was quoted as saying.

The development comes as Pakistan seeks to enhance regional connectivity with landlocked Central Asian states by providing them access to its warm water ports. It recently offered Central Asian states to become part of the China-Pakistan Economic Corridor project, under which Beijing has pledged around $65 billion in energy, infrastructure and other projects in Pakistan.

The South Asian country narrowly avoided a sovereign default last year and has since sought to promote closer economic ties with regional and international allies to bolster its fragile $350 billion economy, which has been suffering from a prolonged macroeconomic crisis.