Reko Diq project: ECC okays Rs65bn for Balochistan govt obligation

ISLAMABAD: The Economic Coordination Committee (ECC) has postponed decisions regarding the hike in drug prices and outsourcing three airports, but it has sanctioned a finance facility worth Rs 65 billion to fulfil the Balochistan government’s responsibilities in settling the Reko Diq dispute.

In this dispute, the International Centre for Settlement of Investment Disputes had ordered the Pakistani government to pay $4.087 billion as compensation to Tethyan Copper Company Pty. Limited, Australia (TCCA), with the entire liability amounting to roughly $6.5 billion. After extensive negotiations, a settlement framework was established that entailed certain terms, including the procurement of TCCA’s shares in the Reko-Diq Project by state-owned businesses of the federal and Balochistan governments.

The government-endorsed the agreement, and the ECC authorised a finance facility of Rs 65 billion to provide funding for the Balochistan government’s share of liability. The Finance Division approved the financing facility’s terms and conditions, which were provided by the National Bank of Pakistan, and the repayment will be directly made by the government of Pakistan through budget allocation. The ECC has also sanctioned the payment of markup, amounting to Rs 6,238,358,879 (Rupees six billion two hundred thirty-eight million three hundred fifty-eight thousand eight hundred seventy-nine only) from the block allocation of Rs 180.000 billion, for the period starting from March 31, 2022, and concluding on December 30, 2022.