Daily Times

In the present era of electric vehicles, rechargeable batteries are being used in every device ranging from Tesla to iPhone.

It is hard to imagine the availability of iPhones, laptops or any other gadget of the same category in the absence of lithium, cobalt, graphite and manganese. Transportation sector heavily relies upon copper and zinc. The construction of bridges would be impracticable in the absence of iron ore.

Energy needs of the economy will remain unmet if uranium is no longer available.

The US Geological Survey 2018 identified 35 minerals critical to the economy and national security. The rare earth minerals are vital for the manufacture of 97 per cent of defence weapons, including drones, missiles, advanced sensors, radars and jamming technologies. Pakistan is blessed with 16 of these minerals. Unfortunately, the extraction and utilisation of these mineral resources are inefficient.

Pakistan is endowed with huge deposits of minerals covering an outcrop area of more than 600,000 square kilometres.

Pakistan has the world’s second-largest coal and salt reserves; fifth-largest copper and gold reserves and is enriched with a vast stock of crude oil and gas. Thar Coal Mine has enough potential to meet the energy needs of the country for the next 100 years. Despite such enormous potential, the contribution of this sector to GDP is around three per cent, while its share in exports is only 0.1 per cent.

Due to outdated technology, quarry wastage in Pakistan is 75 per cent as compared to the international standard of up to 45 per cent

The underutilization at the national level and the unjustifiable treatment of these resources by foreign entities are the prime reasons for lower returns from this sector. A few months ago, the subject of inefficient utilisation of Pink Salt came to limelight. Now, it is open to everyone in the form of Reko Diq, where Pakistan has failed in justifying its case at ICJ tribunal against Tethyan Copper Company (TCC). It now has to pay a penalty of $5.9 billion.

Pakistan is losing ground in the area where it has a natural edge over many countries. Lack of pragmatic policies regarding mineral resources has not only decelerated the economic growth rate but has also resulted in further burden upon national exchequer.

Currently, Pakistan’s economy is posing for deep structural reforms. The country is going to reposition its economy on a growth trajectory; it should never ignore the latent potential of the mineral sector.

This sector can significantly contribute to the economic development of Pakistan like it did in the case of China, Turkey, Australia and Brazil.

Honest treatment of Pakistan’s mineral resources could ensure the promotion of trade, reduction in current account deficit, increase in employment rate, and acceleration in economic growth.

Pakistan is using a hackneyed technology for quarry processes, and, therefore, fails in grabbing a good share in the domestic as well as international market. Due to outdated technology, quarry wastage in Pakistan is 75 per cent as compared to the international standard of up to 45 per cent.

Pakistan has to create an investment-oriented environment, which would not only bring in potential companies to the mining industry. At the same time, it can cause a surge in Foreign Direct Investment. By working on “open for business” mantra, Zimbabwe recorded FDI inflows of $745 million in 2018, up from $349 million in 2017.

Further, before taking some imperative decision for executing a business deal at the international level, Pakistan Mineral Development Corporation should meet international law and standards. The terms and conditions should be set in a way that protects and prioritises national interests. Informational transparency should be ensured.

There exist gaps in the exploitation and marketing of minerals and associated products. Absence of well-devised National Mineral Policy results in procedural delays and lack of technically proficient human capital.

Formulation of a comprehensive and pragmatic National Mineral Policy with an appropriate regulatory framework is needed. This policy should align national and provincial interests. Budget allocation for this sector should be curved to estimation, development and mapping techniques such as geo-modelling and 3D modelling.

According to the World Bank, the demand for minerals due to the persistently rising population will skyrocket the prices of “strategic minerals” by 2050. The continuously growing demand for mineral resources calls for more projects be initiated in the mining sector. With reference to its ability to locate, extract and process mineral resources, Pakistan could be either a prince or a pauper.

For optimal functioning of Pakistan’s mining industry, prudent policies are required to address the paucity of skilled human capital in the sector. The country’s mining industry lacks exposure to modern mining and processing techniques. Therefore, proper consideration should be given to building a stronger base for human capital and technology by investing in relevant educational and technological infrastructure. Training institutes should be set up for the provision of quality training in mining and mineral processing.

There are very few universities in Pakistan, which provide corporate level education specialising in mineralogy and other domains of digging. The spectrum of the pertinent education should be broadened through research-based and pragmatic studies. About 85 per cent of mineralogists and geologists settle abroad under the effect of brain-drain for better career prospects. Pakistan’s government should contact these men of science and utilise their experience in the extraction and processing of the country’s mineral wealth.

The writer is an MPhil scholar from Pakistan Institute of Development Economics (PIDE) and is recently pursuing a PhD in Economics and Finance