Rare Earth Roulette - The Pakistan Gambit

Rare Earth Roulette - The Pakistan Gambit

Source: Reuters exclusive on U.S.-Pakistan negotiations (November 2023)

Buried in Section 871 of the 2023 National Defense Authorization Act is a $2.1 billion allocation for “critical mineral partnerships.” Enter Pakistan—a nation with chronic energy shortages but untapped mineral potential. The U.S. Geological Survey confirms Pakistan’s Reko Diq copper-gold deposits could yield 200,000 tons of rare earth oxides annually. But here’s the rub: processing these minerals requires technology currently monopolized by Chinese firms like Shenghe Resources.

The deal’s timing—days after Trump’s tariff threats—is no accident. It’s a Hail Mary pass in the great power game. Consider the math: building a rare earth supply chain from scratch takes 7-10 years, estimates Adamas Intelligence. By contrast, China’s Jiangxi province alone produces 70% of global terbium—a key component in guided missiles. The Pentagon’s 2022 report warned that 80% of U.S. defense contractors rely on Chinese-processed minerals. Pakistan isn’t a solution; it’s a distraction.

Conclusion: This partnership isn’t about minerals—it’s about political theater. By chasing symbolic wins, Washington risks neglecting real innovation.