US Approves $1.25bn Financing for Pakistan
The United States has approved $1.25 billion in financing through the US Export Import Bank (EXIM) for Pakistan strategic Reko Diq copper gold mining project in Balochistan. The announcement was made by Acting US Ambassador to Pakistan Natalie Baker who described the move as a major step in strengthening economic ties between the two countries.
This is one of the largest US backed investments in the Pakistan mineral sector and is expected to unlock up to $2 billion in US mining equipment and service export while creating thousands of jobs.
Boost to US-Pakistan Economic Partnership
According to the US envoy, EXIM financing will support the purchase of modern US mining technology, operational tools, and drilling equipment for Reko Diq. The deal is projected to generate:
- 6,000 jobs in the United States
- 7,500 jobs in Balochistan, Pakistan
- Significant growth in crossborder trade
- Long-term industrial cooperation in critical minerals
The move aligns with US commercial diplomacy goals aimed at boosting exports and strengthening economic relations with partner countries.
Reko Diq: One of the World’s Largest Copper-Gold Projects
US Approves $1.25bn Financing for Pakistan and The Reko Diq mine is a $7 billion project located in the mineral-rich region of Balochistan. It is being developed by Barrick Gold in partnership with the Government of Pakistan and the Balochistan government.
Saudi Arabia’s Manara Minerals has also shown interest in acquiring a 15% stake, further increasing international confidence in the project.
This mine is expected to become one of the largest contributors to Pakistan’s export economy once it becomes operational.
Pakistan’s $3.5 Billion Debt Financing Package Near Completion
Finance Minister Muhammad Aurangzeb confirmed that Pakistan is close to finalizing a $3.5 billion international debt financing package for the project. The financing is being led by:
- International Finance Corporation
- Asian Development Bank
- Other global lender
EXIM approval removes a major hurdle and signals confidence in the project’s financial viability.
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Projected Economic Impact
Once operations begin Reko Diq is expected to:
- Add $2.8 billion in exports in its first year
- Produce 200,000 metric tons of copper annually in the first phase
- Double output after project expansion
- Generate over $70 billion in free cash flow during its 37 year lifespan
- Add 13 million ounces of gold reserves to Barrick
This makes Reko Diq a cornerstone of Pakistan’s strategy to enter the global critical mineral supply chain.
Security and Infrastructure Challenges
Security remains a key concern due to militant activity in parts of Balochistan. Additionally infrastructure upgrades are required including:
- Railway expansion to Karachi
- Enhanced security arrangements
- Improved logistics operations
Authorities have pledged strong security measures to ensure safe operation.
A Strategic Investment for Pakistan Future
US Approves $1.25bn Financing for Pakistan and The US funding marks a turning point for Pakistan’s mining industry. It not only strengthens foreign investor confidence but also helps Pakistan reduce reliance on traditional sectors by entering the high-value minerals market.
The EXIM backed financing position Pakistan as a future supplier of copper and gold to international markets and strengthen its partnership with the US, Canada and Saudi Arabia.