DND Special Report
The Minerals Diplomacy is at the forefront now after being in the background for a long time, and the reason is the rising demand for lithium to convert the transport sector to green energy—electric-powered vehicles.
In 2010, the Pentagon conducted research on global minerals, and readers can understand that after the “Gold Rush” (1848–1910), the world will surely move to the “Lithium Rush. Can Pakistan place it as a promising digging land in this “Lithium Rush”?
Right now European politics is driven by “Lithium Rush” and Ukrainian President Zelensky on March 4, 2025 confirmed that minerals deal between the US and Ukraine remains “ready” to sign despite the public humiliation at the Oval Office of the Trump administration on Friday. This indicates how much the “Lithium Rush” is driving global diplomacy. The next example can be from the Afghanistan-China mineral deals.
In Ukraine, “Lithium Rush” is writing a truce between Russia and Ukraine, and in Afghanistan, China is investing huge amounts of money in mining despite the history of Afghanistan that nothing tangible and concrete could come out of Afghanistan that is practically run by warlords and global terrorist groups. Afghanistan is believed to possess vast reserves of critical minerals, especially its lithium deposits, believed to be worth easily more than $1 trillion, according to a 2010 Pentagon memo.
When the superpowers are ready to invest in mining in war-ravaged Ukraine and Afghanistan, then why not be in Pakistan, which is not the lesser destination for providing crucial minerals for the global energy transition away from fossil fuels towards more sustainable forms of energy? The lithium is not the only product Pakistan can offer, rather it is already providing gold, copper, and silver to US firms from Baluchistan’s mining sector. As always, Pakistan had been a victim of marketing flaws, administrative hitches, political vendettas, judicial activism (reference of Reko Diq case) and confused decision making as well as disorganized media management. Special Investment Facilitation Council (SIFC) that was an excellent initiative of sitting COAS Gen Asim Munir was designed to mitigate administrative hitches, bureaucratic red-tapism and political vendettas, but our media portrayed this initiative as if it was only for Gulf countries or China although it is an opportunity for everybody and beyond the continental divisions. Since US firms are already minting gold out of mineral sector of Pakistan, they should be first to realise the opportunity of investing in “Lithium Rush” in Pakistan instead of only concentrating at troubling regions such as Ukraine and China should be leading investor in Pakistan’s mineral sector instead of pouring money in Afghanistan from where this is too difficult to get anything without chaos.
Related Story: SIFC and responsibilities lie over the Pakistani media
For decades, Pakistan’s vast deposits of lithium, copper, rare earth elements (REEs), and other critical minerals have remained underutilized due to a lack of investment and infrastructure development, administrative hitches and bureaucratic redtapism, turbulent security issues, and to some extent political infighting. However, all these factors have already been fixed through SIFC and Pakistan’s current government is emphasizing the value of the country’s resources and investing heavily in infrastructure and industry. This means Pakistan can mobilize the mining and processing of its natural resources without delay and is ready to do business with the world. Now is the perfect time for the US to invest in this emerging market before others take the lead.
Related Story: SIFC’s role in promoting foreign investment
Pakistan possesses substantial reserves of critical minerals, many of which are essential for industries ranging from electric vehicles (EVs) and semiconductors to aerospace and defense. Despite these riches, Pakistan’s mineral sector remains largely untapped, making it one of the last frontiers for large-scale mining investment and a sleeping giant in the mineral industry. Some of the key mineral assets include:
- Lithium: Essential for EV batteries and renewable energy storage.
- Rare Earth Elements (REEs): Crucial for advanced electronics, defense technologies, and telecommunications.
- Copper: A vital material for electric grids, wiring, and infrastructure development.
- Gold: A significant asset for economic stability and international trade.
Pakistan’s government has recognized the enormous potential of its mining sector and is actively working to attract foreign investment. Recent policy shifts have included:
- Tax incentives for mining companies and investors;
- Relaxed regulatory policies to encourage exploration and extraction; and;
- Bilateral investment agreements aimed at facilitating international partnerships.
One of Pakistan’s biggest advantages is its geographical positioning. Located at the intersection of South Asia, the Middle East, and Central Asia, it offers key access points to major global markets:
- Gwadar Port: one of the deepest seaports in the region, providing a direct trade route for mineral exports;
- CPEC (China-Pakistan Economic Corridor): an existing infrastructure network that can be leveraged to enhance mining logistics; and
- Proximity to China, India, and the Middle East: Pakistan is a cost-effective supply hub for regional and global markets.
By investing in Pakistan, the US not only secures critical minerals but also gains a strategic advantage in controlling mineral trade routes. With growing demand for these materials and a global push for alternative supply chains, Pakistan is emerging as an ideal strategic partner for the US. The US Exim Bank has already identified Pakistan as a viable partner, signaling that timing is appropriate for US engagement. Additionally, rather than relying on overburdened suppliers like Australia and Canada, where production costs are rising and regulations are tightening, the US could easily engage with Pakistan, where vast, untapped mineral reserves, low extraction costs, and an increasingly open investment climate provide an ideal alternative.
Partnering with Pakistan is not just a short-term business opportunity, it is a long-term strategic move. It creates a diversified, secure supply chain that reduces reliance on China; a cost effective source of minerals, improving US industrial competitiveness; and a strengthened geopolitical alliance in a crucial region of the world.
Global demand for rare earth minerals is increasing at an unprecedented rate. The transition to clean energy, technological advancements, and military modernization all depend on a stable supply of these critical resources. Washington must recognize Pakistan as a critical mineral partner before China, Russia, or other global competitors solidify their presence in the region.
