Pakistan's new hope - critical minerals and, again, America

Pakistan has clutched at a new lifeline - after Trump's tariffs, America might once again be interested in the minerals of Balochistan.

Pakistan is aggressively pursuing international investment to develop Balochistan’s mineral resources, estimated at $6 trillion, despite ongoing insurgency and security challenges that have previously jeopardized foreign projects like China’s CPEC. Let’s look at their strategy, risks, and geopolitical dynamics. The tariffs announced by US President Donald Trump has led to China - a major source of critical minerals clamping down on outflow. So America has started conversations with Pakistan about the minerals in its restive Balochistan region. This is a lifeline for Pakistan which is increasingly failing to control the violent protests demanding independence in the region demanding independence.

Source: Encyclopedia Britannica

Pakistan’s Push for Mineral Investment

The government recently hosted the Pakistan Minerals Investment Forum 2025, promoting untapped reserves of copper, gold, lithium, and rare earth minerals. Key initiatives include:

• National Minerals Harmonisation Framework 2025: Streamlining regulations to ease investor operations.

• Security assurances: Army Chief Gen. Asim Munir pledged a “robust security framework” for projects, citing Reko Diq (one of the world’s largest copper-gold deposits) as a priority.

• Economic incentives: Officials emphasized Balochistan’s potential, with Commerce Minister Jam Kamal calling it a “long-term investment opportunity”.

  
  

Saudi Arabia, China, and the U.S. are primary targets, with Saudi Deputy Mineral Minister Abdulrahman AlBelushi expressing interest in “new heights” of collaboration. US Secretary of State Marco Rubio recently spoke to Pakistani Foreign Minister Ishaq Dar about critical minerals supply, among other things.

What's at stake?

Mineral Reserves in Balochistan

The following table summarizes the key minerals found in Balochistan along with their estimated quantities:

Key Minerals in Balochistan:

1. Copper and Gold: Reko Diq is one of the world’s largest undeveloped copper-gold resources. Saindak has been operational since the late 1990s and produces copper blister along with small quantities of gold and silver annually.

2. Iron Ore: The Dilband/Mastung reserves are the largest in Balochistan. Other deposits are spread across Chagai District.

3. Chromite: Balochistan leads in chromite production in Pakistan with high-quality metrological and refractory grades.

4. Coal: The province has five developed coalfields producing sub-bituminous to bituminous coal suitable for industrial use.

5. Sulfur and Marble: Sulfur is concentrated around Koh-i-Sultan's volcanic crater, while marble deposits are abundant in Chagai and surrounding areas.

Balochistan’s mineral wealth is vast but remains underdeveloped due to infrastructure challenges and security concerns.

Balochistan’s Insurgency and Risks

Balochistan’s mineral-rich regions are epicentres of a decades-long insurgency led by groups like the Baloch Liberation Army (BLA), which opposes foreign exploitation:

• Recent attacks: In March 2025, BLA hijacked a train carrying 400 passengers, killing 23 soldiers and civilians. Earlier, a suicide bomber targeted Chinese engineers near Karachi’s airport, killing two.

• Grievances: Baloch groups accuse Islamabad of extracting resources without sharing benefits, fueling demands for independence.

• Security challenges: Despite military claims of stability, attacks on CPEC-linked projects persist, including Gwadar Port and Reko Diq.

China’s CPEC Setbacks

China’s $62 billion CPEC, once hailed as a BRI “flagship,” has faltered in Balochistan due to:

• Security failures: Over a dozen Chinese nationals have been killed since 2022, including the 2024 Karachi airport attack.

• Local resentment: Communities protest marginalization, enforced disappearances, and environmental harm from projects like Gwadar.

• Economic stagnation: CPEC investments slowed amid debt concerns and militant threats, with only 10,000 local jobs created despite promises.

  
  

Pakistan’s Balancing Act

To reassure investors, Pakistan is:

1. Militarizing resource zones: Deploying troops to protect projects like Reko Diq, though critics argue this exacerbates tensions.

2. Diplomatic outreach: Leveraging Saudi and Chinese partnerships to diversify investment beyond CPEC.

3. Downplaying risks: Officials dismiss insurgency as “subdued” despite ongoing violence.

   
   

However, structural issues remain:

• Provincial-federal disputes over mineral rights.

• Lack of transparency in revenue-sharing with Baloch communities.

Key point

Pakistan’s mineral ambitions hinge on mitigating Balochistan’s insurgency and learning from CPEC’s failures. While the military’s security promises and regulatory reforms aim to attract investors, persistent violence and local discontent pose significant risks. China’s bruised experience underscores the challenge: without addressing Baloch grievances, foreign ventures risk becoming flashpoints rather than economic lifelines. The Reko Diq project will serve as a litmus test for whether Pakistan can balance extraction with equity in a region where distrust of Islamabad runs deep.