PM Orders Inquiry Commission into Reko Diq fiasco – Details
- PM Imran Khan to form an inquiry commission to investigate the massive $6 billion penalties in the RekoDiq
- The commission will investigate elements that are responsible for making Pakistan suffer such a loss.
- Pakistan welcomes the mining group’s offer to work towards a negotiated settlement in order to ensure the needs of some of the poorest people are addressed.
PM Imran Khan has issued orders to form an inquiry commission to investigate the massive $6 billion penalties imposed on Pakistan in the Reko Diq case.
The Prime Minister’s order was communicated in a statement issued by the Attorney General for Pakistan (AGP) Office. It is the first official response to the $5.976 billion penalties imposed on Pakistan by the International Centre for Settlement of Investment Disputes (ICSID).
It is not yet known that who will head the commission and it is expected that the names of its members will be announced later.
Here is the AGP Statement:
“The premier has directed to form an inquiry commission to investigate the reasons as to how Pakistan ended up in this mess, who was responsible for making the country suffer such a loss and what are the lessons learned so that mistakes made are not repeated in the future.”
A detailed internal review of this long-standing arbitration shall also be conducted in due course, it added.
The massive penalty comes weeks after PM secured a $6 billion bailout from the International Monetary Fund (IMF).
The government notes the award by ICSID in the matter of Tethyan Copper Company (TCC). The tribunal has rendered an award of $4.08 billion in favor of TCC against their claim of $8.5 billion, read the statement.
ICSID tribunal was previously detailed due to a dispute between Pakistan and the Tethyan Copper Company Pty Limited (TCC). It chad claimed $8.5billion damages for rejecting its application by the mining authority of Balochistan in 2011. The Supreme Court had also held the contract between Balochistan and the TCC as illegal in 2013.
The statement said that the government of Pakistan will consult with the provincial government involved to devise a strategy for the future.
The statement read: “From now onwards, the government of Pakistan reserves its right to pursue all legal remedies available to it under the ICSID regime, international law, and all other relevant laws to safeguard its interests.”
Earlier, Pakistan had taken the plea before the tribunal that the mining license for the RekoDiq project was acquired through corrupt means.
Islamabad’s commitment to its international obligations:
Referring to this, the statement said:
“Pakistan assures all the foreign investors that their lawful rights, interests and assets will always be protected.”
It also stated that mineral resources in RekoDiq are the collective resource of the people of Balochistan and Pakistan. Pakistan is interested in developing this resource to ensure that the development needs of some of the poorest people on the planet are addressed.
Recently, due to the government’s decision to shut down the mine, the World Bank’s international arbitration tribunal committee awarded $6 billion in damages to Tethyan Copper Company (TCC).
The legal experts of Pakistan were studying the award and reflecting upon its financial and legal implications, the statement continued.
William Hayes, Chairman TCC, said: “We are willing to discuss the potential for a negotiated settlement with Pakistan and will continue to protect our commercial interests and legal rights until the conclusion of this dispute.”
The proposed plant could produce 600,000 tonnes of copper and 250,000 ounces of gold a year. However, the mine is in Chagai district, one of the most deprived parts of Pakistan and rife with sectarian and separatist violence.
Furthermore, the provincial government is also a sleeping partner in the RekoDiq project with a 25% stake. Balochistan’s mining is dominated by small companies focused which waste up to 80% of potential because of poor extraction techniques. The experts have called for more transparent policies to allow mining to flourish.