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Pakistan has been experiencing a severe economic crisis since 2023 and is currently handling crises on multiple fronts. The amalgamation of security, political, and economic issues have shaken the nation’s foundation. The economic crisis that has ensued as of last year, is a result of a confluence of various events that can be traced to historic origins. Pakistan faced record inflation, massive external debt, and an 11% decline in per capita GDP in 2023. These issues nearly caused Pakistan’s economy to collapse, but the IMF bailout package ultimately saved the country. This economic crisis coincided with an increase in terrorism after the Taliban seized control of Afghanistan in 2021. Imran Khan’s detention in 2023, as a result of his protracted conflict with the military, did not help either and rather ushered instability and unrest in the nation.
In 2024, a new administration headed by Shehbaz Sharif assumed power in Pakistan, bringing with it a new political system and term of office, amid turbulent circumstances. The largest task facing the present government may well prove to be providing economic security and stability to those who have been impacted by inflation, which peaked in 2023 at a record 38% and caused the loss of about 700,000 jobs.
In the middle of all of this, Pakistan is also dealing with a number of internal problems, chief among these, being the region of Balochistan, which is grappling with separatist insurrection, sectarian bloodshed, and a much more assertive and recurring Baloch nationalism. Balochistan, which makes up nearly 44% of Pakistan’s land, is made up of the southern Afghan province of Balochistan, the Iranian province of Sistan & Baluchistan, and the province of Balochistan in Pakistan. The region is the largest but least populous and least used part of Pakistan with only 2.9% contribution to the national GDP, despite having vast soil, mineral, and marine reserves. However, it has not seen any notable expansion or development in the region with increased poverty and lowest mortality rates in comparison to other provinces. Balochistan’s poor and ineffective living standards are reflected in the region’s Human Development Index, which is the lowest in the country. In addition to Balochistan’s deteriorating socio-economic conditions, the region’s history and geographical features have also played and continue to play a vital role in the region’s continued misery. Scarce precipitation, primarily in the form of intense downpours, results in significant erosion and floods, while eight months of unbearable heat are experienced annually.
From the beginning of the sovereign state of Balochistan, there had been protracted tension between the Government of Pakistan and Balochistan. The people of Balochistan have accused the Pakistani government and military of multiple human rights breaches, resource allocation against them, cultural fascism, extrajudicial killings, insurgency, suppression, and lack of transparency. This sense of resentment amongst the Balochis can be traced back to the time when Kalat, one of the four princely states that make up modern-day Balochistan, was forcibly incorporated into Pakistan after Muhammad Ali Jinnah, the first Governor-General of Pakistan and the leader of Muslim League, had promised the Khan of Kalat that Balochistan would remain independent and sovereign. The forceful integration of Kalat and in turn Balochistan instilled a sense of mistrust as well as constant dissent and dissatisfaction amongst the Balochi people towards the Pakistani government and its forces. This sense of loss has served as the cornerstone of Balochistan’s claim for independence, as they accuse Pakistan of stealing its freedom and sovereignty by not fulfilling the promise of Balochistan’s independence from Pakistan. From then on, there have been numerous demonstrations and uprisings against the Pakistani government, especially the uprising in 2005 when the protestors sought greater autonomy over their own natural resources. This has led to a belief amongst the Baloch people who accuse the Pakistani federal government of constantly draining and looting their natural resources. As a result, Balochistan has been engaged in an extended struggle on the sovereignty of its natural resources, particularly its rich supply of minerals.
This struggle has led Balochistan to become one of the most volatile combat zones as it faces an ethno-national crisis on its front- a strife to form a separate nation coupled with insurgency. The Baloch people have been resentful of the Pakistan federal government and foreign companies who claim to care about the welfare of the Baloch people for a long time now. As a result of the government’s lack of accountability and response, the people of Balochistan have now resorted to more violent and militarized methods of opposition as a part of their struggle against the federal government. Baloch-nationalism in the region has turned out to be the reaction of the Baloch people against Pakistan’s blind centralized state structure, excess corruption, inadequate federal structures, “unresponsive” and “insensitive” political institutions, Pakistan’s military aggression, and quick changes in leadership. Intense militarism and aggressive ethno-nationalism has led to a rise in the number of violent encounters between Baloch people and the Pakistani Army.
In fact, Pakistan’s two largest copper mining projects are in Balochistan. The Chagai district of Balochistan is home to two of the world’s largest and most resourceful mines, Reko-Diq and Saindak. Both projects have federal and provincial government holdings and have been leased to Barrick Gold Corporation and China Metallurgical Group Corporation (MCC), respectively. Both initiatives have failed to produce any notable improvements in the area, particularly Saindak, which has been run by MCC for more than a decade. As a result, the people of Balochistan continue to feel bereaved and resentful of their lost resources and freedom.
The newly elected prime minister of Pakistan, Shehbaz Sharif, recently met with Saudi Arabia’s crown prince, Mohammed Bin Salman, to negotiate a $5 billion initial investment in Pakistan. It is said that $1 billion of the $5 billion will go toward the Reko-Diq copper-gold mine in Balochistan. While resources in the Balochistan region can be helpful to Pakistan and the people of Balochistan, the Balochi people see this as just another move by the federal government to drain their resources and further exploit them. Normally, this could be a hope for a better future but considering the history of exploitation that the Baloch people have endured over the years, this move just seems another farce of the federal government and foreign entities.
However, if such unrest continues in Balochistan, Pakistan’s goal of beginning production at Reko-Diq in 2028 will be dashed because of the rise in violent clashes between the Baloch people and the Pakistani army along with the ongoing, frequent insurgency in the area. Apart from this, the suspected alliance between Tehreek-e Taliban and militant groups of Balochistan only intensifies the depth of trouble for the Pakistan federal government. This intensified struggle in the region also poses a threat for Barrick Gold and MCC who own large amounts of shares in their respective mines. To protect Reko-Diq and Saindak, both Barrick Gold and MCC will need to concentrate more on the security of the mines as the militants will try to disrupt the shipments of minerals and equipment into and out of the country. With the recent turn of events in Balochistan and the rise of militant encounters and civil unrest, it only seems like a distant thought for Pakistan to gain success in the utilization of the two mines and achieve stability and control in the region of Balochistan anytime soon.
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