Pakistan is accelerating efforts to move beyond raw mineral exports by developing processed and value-added critical mineral products that meet international Environmental, Social, and Governance (ESG) standards, aiming to boost foreign exchange reserves and build long-term economic resilience. According to a new policy note by the Institute of Cost and Management Accountants of Pakistan (ICMA), the country’s recent entry into the global critical minerals market marks a significant milestone, but the real economic opportunity lies in creating integrated domestic value chains rather than relying on unprocessed resource exports.
The ICMA analysis followed Pakistan’s first shipment of critical minerals to the United States in October 2025 under a $500 million agreement with Missouri-based US Strategic Metals (USSM). The consignment included antimony, copper concentrate, and rare earth elements such as neodymium and praseodymium, materials essential for electric vehicles, renewable energy technologies, and advanced manufacturing. The deal, signed in September 2025 with Pakistan’s Frontier Works Organisation, envisions local exploration, processing, and refining operations to maximise domestic value addition and strengthen Pakistan’s position in strategic global supply chains.
While mineral exports represent progress, ICMA stressed that Pakistan faces structural challenges that must be resolved to unlock its estimated $8 trillion mineral wealth. These include fragmented governance frameworks, unclear regulatory systems, weak infrastructure, limited local processing capacity, environmental and social oversight gaps, security risks, and a shortage of skilled mining professionals. Addressing these barriers is viewed as essential for building investor confidence and transforming the sector into a sustainable economic driver.
Historically, Pakistan’s mining industry has contributed less than 3 percent to gross domestic product despite vast deposits of copper, gold, chromite, and rare earth elements. The ICMA research projects that meaningful economic impact from value-added mineral exports will emerge gradually, with an initial demonstration phase of two to three years, moderate scaling over the following five to seven years, and full impact expected beyond a decade. Over time, integrated processing and refining could significantly expand industrial output and foreign exchange earnings.
A central pillar of Pakistan’s mineral ambitions is the Reko Diq copper-gold project, one of the world’s largest untapped reserves. Production is scheduled to begin in 2028, with capacity expansion planned through 2034. The project is expected to play a major role in establishing Pakistan as a global mineral supplier while supporting downstream industries linked to metals processing and manufacturing.
Policy initiatives such as the Pakistan Mineral Investment Forum and the National Mineral Harmonisation Framework are designed to improve coordination between federal and provincial authorities, streamline regulations, and attract foreign capital. International interest has also grown through the China-Pakistan Economic Corridor and increasing engagement from Saudi Arabia and Western partners. ICMA emphasised that policy consistency and institutional cooperation will be critical to sustaining this momentum.
The evolving partnership with the United States is being positioned as a model for responsible mineral development, combining technical expertise with access to global markets. By embedding ESG principles across the supply chain, Pakistan aims to align with global sustainability expectations while contributing to clean energy transitions worldwide.
In late October 2025, a delegation from the US government-funded Critical Mineral Forum visited Pakistan to explore collaboration opportunities aimed at building secure and transparent mineral supply chains for American industries. The group held discussions with Finance Minister Muhammad Aurangzeb and other stakeholders on investment frameworks, supply-chain security, and sustainable mining practices, reflecting Washington’s efforts to diversify critical mineral sources amid concerns over China’s dominance in rare earth markets.
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