Huge Mistake: Pakistan is Losing Control of Its Minerals

In a developing crisis that could severely impact the future of Pakistan’s economy and national security, experts are raising alarms over the rapid loss of control over the country’s mineral resources. From Balochistan’s rich gold and copper reserves to Gilgit-Baltistan’s rare earth minerals, foreign companies and elite local entities are gaining unchecked access, leaving Pakistan with crumbs of its wealth.

• Billions in minerals slipping through Pakistan’s hands

• Foreign companies dominate key mining contracts

• Lack of transparency in exploration and extraction deals

• Gilgit-Baltistan and Balochistan at the center of mineral rush

• Experts warn of long-term economic and security fallout

• Need for mineral policy reforms and local empowerment

Pakistan is rich in natural resources, including:

• Copper

• Gold

• Rare earth elements

• Coal and iron ore

• Gemstones (rubies, aquamarine, emeralds)

• Lithium, cobalt, and other high-demand minerals

Yet, despite these blessings, Pakistan continues to rely on imports for many raw materials and allows foreign entities to dominate exploration, extraction, and export.

This has led to a serious imbalance, with foreign companies reaping massive profits while Pakistan gets minimal royalties, lacks local refining facilities, and sees no real development in mining zones.

The Reko Diq project in Balochistan — containing one of the world’s largest undeveloped copper-gold deposits — is a case study in Pakistan’s mineral mismanagement.

• Initially owned by Tethyan Copper Company (TCC), a joint venture between Barrick Gold (Canada) and Antofagasta (Chile)

• Pakistan canceled the license in 2011, triggering international arbitration

• The government later settled and allowed Barrick Gold to resume operations with a 50% ownership stake

• Projected value: Over $100 billion worth of minerals

• Pakistan’s share: Just around 25%, after operational costs

Key Issues:

• Low royalty rate compared to international benchmarks

• No local smelting or refining, forcing Pakistan to import refined copper

• Limited job creation in nearby regions

• Environmental concerns with little accountability

Gilgit-Baltistan (GB) is home to vast reserves of precious and semi-precious gemstones, as well as rare earth minerals critical for high-tech industries:

• Rubies, emeralds, tourmaline, aquamarine

• Lithium, cobalt, and coltan (used in batteries and electronics)

• Uranium and thorium (used for nuclear energy)

Yet most of these minerals are:

• Illegally mined by locals under poor safety conditions

• Smuggled across borders, especially into China

• Sold at throwaway prices, with no value added

Local miners receive only 1–2% of the actual global market value of their finds.

Experts blame the lack of a unified national mineral policy and poor regulation for this mess.

Current Gaps:

• Fragmented control: Provinces and federal bodies often clash

• No central authority to monitor contracts and compliance

• Opaque deals between governments and foreign investors

• Inadequate geological surveys — over 70% of Pakistan remains unexplored

• No mandatory environmental or social audits on mining projects

This has resulted in Pakistan handing over extraction rights for decades-long contracts without proper cost-benefit analysis or public transparency.

• Pakistan loses billions of dollars annually due to undervalued mineral exports

• Foreign exchange crisis worsens as the country continues importing what it could refine locally

• Local industries suffer due to a lack of raw materials and technology

• Missed opportunities to create hundreds of thousands of jobs

• Dependence on foreign mining firms increases economic vulnerability

Experts and economists are urging the government to act urgently:

Policy Reforms

• Create a National Mineral Development Authority

• Revise royalty structures to match global standards

• Mandate value addition and local refining

• Make mining contracts public to ensure transparency

• Require environmental and social impact assessments

Empower Local Communities

• Give local miners legal licenses and safety training

• Allocate part of the mining revenue to local development funds

• Promote public-private partnerships in mining zones

• Encourage skill-building programs for locals

Build Global Alliances

• Collaborate with friendly nations for tech transfer

• Seek joint ventures with international mining giants

• Offer incentives for setting up refining and smelting plants in Pakistan

Several economists, activists, and politicians have raised red flags.

“We are exporting raw minerals and importing refined versions at 5x the price. This is economic suicide. Pakistan must reclaim control of its resources.”

“Mining without environmental oversight is causing water pollution and displacing communities. It’s a silent tragedy no one talks about.”

“Foreign companies take the gold and leave the dust for us. Our youth are unemployed, and our lands are poisoned.”

If Pakistan fails to reform its mineral policy and assert greater control over its natural resources:

• The country could lose trillions in potential revenue

• Remain trapped in foreign debt and economic dependence

• Miss out on the global minerals boom that could fuel its industrial revolution

But with the right leadership, transparency, and vision, Pakistan’s minerals could power its future — from clean energy to cutting-edge technology.