Reko Diq Mining, F-16 Upgrade Sales, IMF Tranche: Pakistan Secures Major Deals from Trump Admin
New Delhi: In a significant shift in bilateral relations, Pakistan has secured nearly $2-billion worth of commitments from the United States within a span of days, signalling a potential thaw in ties under the Trump administration that could reshape regional dynamics.
The Export-Import Bank of the United States approved $1.25 billion in financing for Pakistan's Reko Diq copper-gold mining project in Balochistan on December 10, marking one of the largest American economic engagements in Pakistan's mineral sector. The US Chargé d'Affaires to Pakistan Natalie Baker explicitly stated that forging such deals has become "central to American diplomacy" under the Trump administration, emphasising the strategic importance of critical minerals for American security and prosperity.
The Reko Diq financing will enable up to $2 billion in American mining equipment and services for the project, expected to create 6,000 jobs in the US and 7,500 in Pakistan's restive Balochistan province, Dawn reported. The $7 billion project, being developed by Canadian mining giant Barrick Gold in partnership with Pakistan's government, is projected to produce 200,000 metric tons of copper annually and generate $2.8 billion in export revenue in its first year of shipment.
Just two days earlier, on December 8, the US Defense Security Cooperation Agency notified Congress of a $686 million sale of advanced technology for Pakistan's F-16 fighter jets. The package includes 92 Link-16 tactical data link systems and comprehensive upgrades aimed at modernising Pakistan's F-16 fleet and extending aircraft life through 2040, as per a Dawn report. Notably, Pakistan had requested these upgrades in 2021 during a period of strained relations, but Washington delayed its response until now.
These military and economic commitments come alongside the International Monetary Fund's approval of a $1.2 billion tranche for Pakistan on the same day, bringing total IMF disbursements to approximately $3.3 billion since last year. The Fund cited Pakistan's "significant progress" in stabilising its economy, with foreign exchange reserves rising to $14.5 billion and the country achieving a primary surplus of 1.3% of GDP.
For India, these developments raise concerns about Pakistan's growing alignment with American strategic interests, particularly in the critical minerals sector that underpins modern technology and defence capabilities. The timing is especially notable as it follows recent tensions between India and Pakistan, with Islamabad crediting Trump for brokering a ceasefire after Operation Sindoor and even nominating him for the Nobel Peace Prize.
The convergence of military hardware sales, massive mining investments, and financial support suggests Washington may be recalibrating its South Asia policy under Trump's transactional approach to diplomacy. With the US seeking to secure supply chains for critical minerals amid global competition, Pakistan's geographic position and untapped mineral reserves appear to have gained strategic value.
The deals also indicate that Pakistan's economic difficulties may be attracting American interest rather than acting as a deterrent, as Washington seeks partners willing to align with its goals of reducing dependence on rival suppliers.
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