Baluchistan has fair potential to attract FDI
September 23, 2011
Richness in valuable mineral and energy resources and strategic location of Baluchistan makes it more favorable province in Pakistan for the domestic and foreign investors. After it has been granted fiscal and administrative autonomy and control over its strategic assets, the ability of its decision-makers to exploit such a potential can not only make a huge difference for its own population but also the whole Pakistan where flash floods and rains have added more to the list of poor and resource-less.
After the provinces have been autonomy in their administrative and fiscal affairs, Baluchistan stands high in terms of its potential to become the richest province of the country. No federal unit has as much natural resources as Baluchistan. Right technology and the capital are not an issue in the global age specially when the nature of assets it has are in high demand in the world.
In an energy deficient country like Pakistan, Baluchistan’s gas reserves are well known. It is the single largest incentive for the industrialists to develop stake in this province.
Baluchistan has second largest gold and copper reserves other than aluminum, uranium and platinium. Exploitation of these resources certainly requires huge investment and the state-of-the-art technology which neither can be provided domestically.
Additionally, Baluchistan’s strategic importance has increased due to its proximity with Afghanistan where international coalition, led by US and its western allies, is fighting Al-Qaeda and its associates. Too China is aggressively pursuing its Look West policy to develop its western regions and Baluchistan and its sea port Gawadar is vital for providing it access to the Gulf.
The Shanghai Cooperation Organization (SCO) and initiative of China and Russia and Central Asian statutes being on board, has plans to make heavy investment in rail and road infrastructure to revive traditional Eurasian corridor. Baluchistan is bound to benefit a lot after US drawdown from Afghanistan and restoration of peace in this war-torn country.
Baluchistan has already attracted world fame companies from across the world to exploit it mineral resources. A number of Chinese firms have made huge investment in Saindak gold and copper mines while the world fame company Tethyan Copper has invested millions of dollars on building necessary infrastructure to explore Reko Diq reserves in Chaghai district besides its willingness to invest $ 3.3 billion on mines development, involving training of 11500 personnel. The energy resources of the province can attract investors like Gazprom of Russia going by Islamabad’s growing ties with Moscow.
Having rational and realistic investment policy is the first step to the prosperity for Baluchistan. Baluchistan Mineral Rules 2002 have become a subject of immense interest for international investors as they compete for a license to initiative desired projects.
Of course, the provincial administration has to adjust with the ground realities. It is quite natural that international investors are highly interested in the resources of this province and there is chance that such competition transforms into conflict to the disadvantage of the province and its people. Here, the wisdom of policy-makers can make a huge difference.
Securing the maximum interest of the province with a focus on poverty alleviation is the first and foremost principle which the decision-makers should stick to. It means education, training, and jobs for the youth of the province, particularly the ones belonging to the area where a project is started. Strict observation of environmental and labor laws by the investors is another criterion to grant licenses for the exploitation of Baluchistan’s natural resources.
Though Baluchistan is right now marred with militancy, both ethnic and sectarian, it is best time to devise proper strategy to defeat the both by taking the course of sustainable development. By letting the international investors in will not only bring the necessary technology to develop mineral resources of the province but will also create job opportunities for the hopeless youth, not only of this province but also the whole country.
It is worth mentioning that agriculture the backbone of Pakistan’s economy has taken regressive course due to commercialization of the sector, over exploitation of the soil and the mammoth increase in the population. Worsening energy crisis has taken toll of the heavy industry and textiles. In such a frustrating scenario, Baluchistan by opening its mining sector to serious and interested international investors can not only fulfill development needs of its own but can also prove a ray of hope for the rest of the country as well.