In a significant development aimed at shoring up Pakistan’s struggling economy, the government is reportedly considering selling a 15% stake in the Reko Diq Mining Project to Saudi Arabia. The Saudi Public Investment Fund (PIF) has expressed interest in this stake and has also proposed grants for infrastructure development as part of the deal. This move is seen as part of broader efforts by Pakistan to stabilize its economy, which has been under severe strain in recent years.
The Reko Diq mine, located in the Chagai district of Balochistan, is a joint venture with 50% owned by Barrick Gold, one of the world’s largest mining companies, and the remaining half split between the Pakistani government and the provincial government of Balochistan. The mine is considered one of the largest gold and copper deposits globally, with early reports dating back to 1995 revealing significant amounts of both minerals. Experts have estimated that Reko Diq could hold around 400 million tons of gold and copper, with the potential value of the reserves exceeding $1 trillion. This makes the mine a critical asset for Pakistan, not only in terms of its economic potential but also its strategic importance.
The sale of a 15% stake in Reko Diq to Saudi Arabia could provide much-needed financial relief to Pakistan. The country has been grappling with severe economic challenges, including a mounting debt crisis, inflation, and a depreciating currency. While aid from the International Monetary Fund (IMF) has provided temporary relief, the sale of state-owned assets such as Reko Diq may be one of the few viable options left for the government to stabilize the economy in the long term.
However, the decision to sell a stake in such a valuable national asset is not without controversy. There are concerns about the long-term implications of ceding control over natural resources to foreign entities. Additionally, the negotiation process will be closely watched, as it will set a precedent for future deals involving Pakistan’s state-owned enterprises and natural resources.
In addition to purchasing a stake in the Reko Diq mine, the Saudi PIF has reportedly proposed grants for infrastructure development in Pakistan. This could be a crucial element of the deal, as Pakistan’s infrastructure needs are vast and growing. Improved infrastructure could help boost economic activity, create jobs, and attract further foreign investment, contributing to the country’s overall economic stability.
As Pakistan moves forward with the review process, the outcome of this deal will have far-reaching implications for the country’s economic future and its relationship with Saudi Arabia. The world will be watching closely as Pakistan navigates this complex and high-stakes negotiation.
