Pakistan has reportedly agreed to permit the Kingdom of Saudi Arabia and Qatar to seek resolution through the Permanent Court of Arbitration (PCA) or the International Centre for Settlement of Investment Disputes (ICSID) in the event of any issues arising from their planned multibillion-dollar investments in projects.
Discussions between the two sides are ongoing, focusing on the precise valuation of the Reko-Diq project, with Manara Minerals finalizing the term sheet and valuation. The Manara Minerals Investment Company, a joint venture between the Saudi Arabian Mining Company (Ma’aden) and the Public Investment Fund (PIF), is set to invest in global mining assets for Riyadh, supporting the development of resilient global supply chains.
On Pakistan’s side, the Reko Diq Mining Company (RMDC) is tasked with hiring levies and defining payment mechanisms for Balochistan.
Sources indicate that Pakistan has negotiated a graduated approach for settling investment disputes, involving a mandatory eight-month period for resolution at domestic forums. In cases where disputes remain unresolved, recourse to the PCA or ICSID as international arbitration forums has been agreed upon.
The investment chapter may be annexed to a Free Trade Agreement (FTA) with Gulf Cooperation Council (GCC) countries, outlining the process for investor and state dispute settlement through the ICSID, as agreed with Saudi Arabia and Qatar.
The GCC has assured Pakistan that the legally cleared draft will be shared in due course. The Pakistani envoy has been assigned to follow up with the GCC Secretariat and provide an update before the next Special Investment Facilitation Council (SIFC) meeting.
Additionally, the SIFC has granted in-principle approval for establishing the National Industrial Development & Regulatory Authority (Nidra). Modalities for the authority will be finalized through consultations with the provinces, and the Board of Investment (BOI) has been tasked with initiating legislation for the proposed model.
This legislation, expected to be completed by March 2024, will include a framework for unifying existing economic and industrial zones. Until then, work on the proposed model will proceed in consultation with provincial governments.
