US Commits $1.25 Billion for Pakistan’s Reko Diq Critical Minerals Project

The United States has reinforced its strategic interest in Pakistan’s critical minerals by approving major financing for the Reko Diq mining project in Balochistan. The $1.25-billion support from the US Export-Import Bank marks one of Washington’s largest mineral-sector partnerships in Pakistan and signals a shift in regional geopolitical alignments.

Funding Package and Strategic Intent

The financing aims to accelerate development of the Reko Diq copper and gold reserves, considered among the world’s largest untapped deposits. The initiative is expected to bring in up to $2 billion worth of US mining equipment and services, benefitting American exporters and supporting job creation in both countries. The first year of operations is projected to generate export potential of $2.8 billion.

Geopolitical Implications

The move reflects a strengthened US–Pakistan relationship in President Donald Trump’s second term. Washington is positioning Pakistan as a central partner in its Asia policy, including in joint resource extraction. At the same time, US–India relations have cooled, with trade frictions contributing to diplomatic strain. The Reko Diq model is viewed by the administration as a template for future critical mineral partnerships.

Project Structure and International Interest

The project is led by Canadian firm Barrick Gold, which holds a 50 per cent stake, while Pakistan’s federal and provincial governments each retain 25 per cent. The overall project cost is estimated at around $7 billion. Growing global demand for copper in electric vehicles, renewable technologies, and AI hardware has boosted Pakistan’s urgency to operationalise the mine. Saudi Arabia’s Manara Minerals has also indicated interest in acquiring a minority stake.

Exam Oriented Facts

• US Exim Bank has approved $1.25 billion financing for the Reko Diq mining project.
• Reko Diq is believed to contain one of the world’s largest undeveloped copper–gold deposits.
• The project is owned 50% by Barrick Gold and 25% each by Pakistan’s federal and provincial governments.
• First-year export potential is estimated at $2.8 billion.

Security Challenges in Balochistan

Despite its mineral wealth, Balochistan remains underdeveloped due to long-running insurgency and attacks on state and foreign projects by separatist groups. Security risks have historically slowed investment, and ensuring safe operations will be crucial for the success of large-scale ventures like Reko Diq.