Pakistan Reader# 470, 14 December 2022
On 13 December, the Federal Cabinet approved the signing of the Reko Diq project deal before 15 December and witnessed differences between the ruling coalition parties regarding discussions of the cabinet. This comes as the government’s two main coalition parties, the Jamiat Ulema-e-Islam Fazl (JUI-F) and the Balochistan National Party-Mengel (BNP-M) boycotted the meeting which was chaired by Prime Minister Shehbaz Shariff. The two parties objected to the passage of a resolution that favoured the deal of the Reko Diq Project in Balochistan and said that the resolution was an “attempt to usurp” the rights of the people of Balochistan and that they were not considered before approving the deal.
PM Shebaz responded to the two parties’ claims and remarked that the government of Pakistan would “ensure” the protection of the rights of all the investors in the investment projects in the country, including the Reko Diq project, and said that their dues would be “fulfilled.” Forming a committee to remove any grievances of the JUI-F and the BNP-M, PM Shehbaz assured the two of an amendment bill that would be tabled in the parliament only after consulting the two allies.
Cabinet’s position on the Reko Diq project
On 9 December, the Supreme Court approved the Reko Diq project after a presidential reference was filed in the court under Article 186 of the Constitution for “legal opinion” on the final decisions. The court put forward its opinion agreeing that the restructuring of the Reko Diq project was “transparent.” The cabinet was told that the opinion of the SC had “already been” taken under the purview of the Foreign Investment (Promotion and Protection) Bill of 2022 and that it was unanimously consented by all the coalition parties that the legislation of the bill was extended to the Reko Diq project only.
Following this development, the cabinet approved the regulatory framework for the state enterprises and their special purpose vehicles for both the Balochistan government and the Reko Diq project for restructuring. The ministers approved the final agreement on the recommendation of the Petroleum Division and the funding plan of the Economic Coordination Committee of the Cabinet as well.
The allies’ position on the final agreement
The JUI-F and the BNP-M’s objection to the deal was targeted at the agreement not entailing their opinions on the matter and retaliated because the deal would “usurp” the rights of the Balochistan people. They said that the resolution was passed in the “dark of night” and that it “deceived” the people of Balochistan. This comes as the Balochistan Assembly also witnessed lawmakers bashing the agreement and the government for the passage of a resolution of the deal and the federal and Balochistan governments entering into a settlement with Tethyan Copper Company Australia, following an arbitrary award issued by the International Centre for Settlement of Investment Disputes. The Petroleum Division informed the ECC that the settlement entails nearly USD 900 million and the TCCA is jointly owned by Barrick Gold as well.
Under this agreement, Balochistan holds 25 per cent of the project under the new pact and the other 25 per cent is controlled equitably by three state-owned enterprises in the country. Barrick Gold Corporation, the current joint venture company, holds 50 per cent of the shares in the deal. (Syed Irfan Raza, Cracks appear in ruling coalition over Reko Diq,” Dawn, 14 December 2022, “Rift emerges in coalition over Riko Diq deal,” The Express Tribune, 14 December)