Finance Minister Muhammad Aurangzeb said on Friday that the World Bank Group has approved a $700 million loan for the Reko Diq mining project.
India opposed the loan and tried to block the investment. But the World Bank rejected India’s objections and cleared the package.
Aurangzeb shared this update during a Senate committee meeting on finance.
The loan includes $300 million from the International Finance Corporation (IFC) and $400 million from the International Development Association (IDA).
This is the third time in one month that India has failed to stop lending to Pakistan.
The finance minister said India is lobbying against Pakistan at global financial institutions. But lenders like the IMF, World Bank, and ADB have not supported India’s stance.
The total cost of the Reko Diq project is $6.6 billion.
The IFC is leading the coordination among lenders.
The funding will help start the mining of copper and gold in Balochistan.
Pakistan’s share in the project is 50%. This includes 25% from the federal government and 25% from the Balochistan government.
Barrick Gold owns the other 50% and is managing the project.
The project is expected to start production in 2028. In the first phase, it will produce 200,000 tonnes of copper per year.
The second phase will raise production by 2034. Total investment could reach $9 billion.
The World Bank says the project could create up to 10,000 jobs during construction. It will also support local hiring and women’s employment.
The mining company will also invest in local development.
The area around Reko Diq has other mineral sites. A new mining zone may be developed in the future.
All revenue from the project will be in foreign currency.
The World Bank says the project could add $2 billion per year to Pakistan’s economy, depending on global prices.
“Backed by latest major financing package from the International Finance Corporation (IFC)- including a US$300 million direct loan and US$400 million in blended finance – the project marks IFC’s first mining investment in Pakistan and signals renewed global confidence in the country’s economic potential,” said Dr Tauqir Shah, top aide to the prime minister.
