Page 73 - CMA Journal (Sep-Oct 2025)

ECONOMY
O THER F EATURES
WATCH

By ICMA Research and Publica ons Department
Pakistan’s Strategic Entry into the

U.S. Critical Minerals Market

In a landmark step that reshapes Pakistan’s economic and • Phase 1: Demonstration period of 2–3 years.
geopolitical profile, the country formally entered the
• Phase 2: Moderate commercial scaling over
global critical minerals market on October 2, 2025,
dispatching its first consignment of enriched rare earth 5–7 years.
elements and critical minerals to U.S. Strategic Metals • Phase 3: Significant impact after a decade, subject to
(USSM) under a USD 500 million agreement. This marks effective security, technical, and financial risk
Pakistan’s transition from a resource-rich yet management.
underutilized nation to an emerging participant in the
global supply chain for strategic raw materials. Pakistan’s Mineral Opportunity
The shipment, containing antimony, copper concentrate, Pakistan stands on the brink of a mineral-driven
and rare earths such as neodymium and praseodymium, economic transformation, with an estimated USD 8
marks the beginning of a partnership between USSM and trillion worth of mineral wealth spread across 600,000
Pakistan’s Frontier Works Organization (FWO). Signed in square kilometers. The country hosts 92 identified
September 2025, the agreement outlines plans for an minerals, 52 of which are commercially extracted,
integrated value chain within Pakistan, covering including copper, gold, lithium, cobalt, chromite, and rare
exploration, processing, and refining to ensure greater earth elements, alongside large reserves of marble,
domestic value addition.
granite, coal, and gypsum.
Despite vast deposits of copper, gold, chromite, and rare
earth elements (REEs), Pakistan’s mining sector has At the centre of this potential is the Reko Diq copper-gold
historically contributed less than 3% to GDP. The project, among the world’s largest untapped reserves.
government’s recent push toward value-added mineral Production is expected to begin in 2028, with capacity
exports reflect a strategic shift toward industrial expanding from 45 million tonnes to 90 million tonnes
diversification and high-value trade. per annum by 2034, according to Barrick Gold
Corporation. With rising global demand for green energy
While the inaugural shipment is historic, sustaining minerals, Pakistan has a unique window to emerge as a
growth will require overcoming structural and key exporter.
operational challenges. Progress is expected in phases:

Figure 1-Source: The Diplomatic Insight Figure 2-Source: IPRI- Islamabad Policy Research Institute
ICMA’s Chartered Management Accountant, Sep-Oct 2025 71