Japan Eyes Investment in Pakistan’s Reko Diq

Japan has shown interest in joining the multibillion-dollar Reko Diq copper and gold mining project, marking a potential expansion of its investment footprint in Pakistan beyond the automobile sector. The Economic Coordination Committee (ECC) of the cabinet was recently informed that Japan is keen to participate alongside local and international investors. The Finance Division supported the proposal, assuring that the arrangement will not lead to capital flight through dollar remittances. Saudi Arabia has earlier expressed plans to inject capital into the project, including the purchase of a 15% stake. In response to Japan’s inquiry, officials told the ECC that sovereign guarantees from the government and additional backing from the Asian Development Bank (ADB) for Balochistan Mineral Resource Limited (BMRL) equity had been included in the framework. According to the Petroleum Division, the project’s equity amounts to $900 million, split equally between sponsors and partner agencies. State-owned enterprises are committed to repatriating $2.1 billion through Pakistan Minerals Private Limited over seven years, either as equity or shareholder loans. Financing of $3.5 billion is being arranged, with health, safety, security, and community welfare set as core priorities. The Petroleum Division also sought approval for final agreements, including permissions for BMRL to repatriate $1.3 billion over seven years to meet its shareholding commitment. Oil and Gas Development Company and Pakistan Petroleum Ltd will initially cover the foreign exchange needs from their own resources, with government backing pledged in case of shortfalls. The ECC acknowledged the strategic importance of the Reko Diq project, emphasizing its potential to reshape the economy of Balochistan and contribute significantly to Pakistan’s growth.