No doubt, investment is of an utmost significance in the socio-economic advancement of a country. In circumstances the arrival of a foreign investor for investment would be a blessing of God. But salute to our leaders and their “multitalented advisors” who have failed to eradicate malpractices from PSE’s (Public Sector Enterprises); a noteworthy example of negligence is of Rekodeq Project. This copper-cum-gold mining project has become an apple of discord between the government of Balochistan and Tethyan Copper Company Pakistan Ltd. (TCC). This agreement was inked between GoB and BHP Billiton in 1993. In 2000, BHP transferred 75 per cent of it shares to TCC. This deal was, and is totally in line with Chagai Hills Exploration Joint Venture Agreement (CHEJVA) and Balochistan Minerals Rules (BMR) 2002.
The estimated mine-life of this project is 56 years while the mineral reserves are estimated to be about 5.9 billion tonnes. 2006 onwards, the mining company has invested more than US $220 million on this project – the single largest foreign direct investment in Pakistan.
The government of Balochistan has discarded the mining license application of TCC that has invested its resources to bring Reko Diq on the map. The provincial government did not even bother to negotiate with TCC on their feasibility report and backtracked on CHEJVA that was signed seventeen years ago and was even endorsed by the Supreme Court in its hearing of the case. But media reports exuding fallacies synthesized many questions regarding the project’s future.
Now the company has gone for international arbitration to safeguard its legal rights which are in line with the CHEJVA Agreement and Balochistan Mineral Rules 2002. If the company succeeds in having the court’s decision in its favour then the government does not seem to be in a position to reimburse company’s finances. Sources claim that the provincial government has requested to the apex court to declare the said agreement null and void because it fears that the possible decision in result of arbitration will be in investor’s favour.
On the other hand, some Chinese and American firms have also entered in this “Copper-Gold Race”. The recent advancements on the part of the provincial government reveal that it has made its mind that it will not issue the license to TCC but is in a fix while earmarking the “friend-country” it should exalt; America or China.
The question is why the government has not given time to the company representatives? If the government is really interested in the well being of its people and is well aware of the far-reaching effects of this project on country’s economy then why it did not go for a new feasibility report? If the company was not following mining rules or by-passing any law then why the government did not bother to take a stern action against it in the past seventeen years?
I fail to understand why, and on whose behest, the chief minister of Balochistan and the nuclear scientist Dr Samar Mubarakmand are bent upon tarnishing the reputation of Pakistan in front of foreign investors by sabotaging a seventeen years old joint venture agreement by creating false propaganda I have no doubt about Dr Mand’s patriotic spirit but it’s not explicable how he will complete this mega-project without modern technology and finances while he is not feeling at home with the government machinery in the process of Thar Coal Project.
Projects like these require unlimited resources and people with proven expertise and track record. We don’t have such modern technology apparatus and financial resources which are considered necessary for the successful accomplishment of this project. For Balochistan to prosper, it needs much more than gold and copper reserve, which remains buried underground.
Balochistan is in desperate need to improve its human capital to reap the maximal advantage from the natural resources. Remember what happened with Saindak Copper Gold Project. Foreign contractors build it in 1990s. When it came online and Pakistani government took over, it started generating loss after loss despite gold and copper flowing from it. It had become the world’s first loss-making gold mine by the late 1990s and the budgetary comity had to close it down to stop the losses. Later on, it was given to Chinese operators who are running it today!
The need of the hour is that the government should take some serious steps to decide this matter impartially. This is high time for the government to ensure its credibility by promoting investor friendly environment which will rejuvenate our market and will have a positive impact on the socio-economic development of the country.
Shahzad Ali Gill – The writer is a freelance journalist