Japan to invest $300 mn in Pakistan's copper mine amid supply crunch

Situated in Pakistan's Balochistan province, the Reko Diq copper-gold mine is poised to become one of the world's five largest copper reserves, drawing Japanese financing and industrial support

The Japan Bank for International Cooperation (JBIC) and several other Japanese entities are preparing to invest in Pakistan’s Reko Diq copper mine project, signalling Tokyo’s growing interest in securing supplies of critical minerals likely to face shortages in the years ahead, Nikkei Asia reported.

 

JBIC plans $300 million loan for Reko Diq project

 

Pakistan’s Finance Minister Muhammad Aurangzeb met JBIC Governor Nobumitsu Hayashi in Washington last month and “welcomed JBIC’s formal commitment to join the Reko Diq lender group”.

 

Aurangzeb said the move would strengthen investor confidence and encourage Japanese businesses to expand their footprint in Pakistan. JBIC intends to commit around $300 million to the project, with the loan agreement expected to be finalised by early next year.

 

 

Reko Diq among world’s largest copper reserves

 

Located in Pakistan’s southwestern Balochistan province, the Reko Diq copper-gold mine is expected to rank as the world’s fifth-largest copper deposit. According to an April report by consultancy firm Digby Wells, the project will be developed in two phases, each designed to process 45 million metric tonnes of ore annually and produce 800,000 tonnes of copper concentrate with a copper grade between 26 per cent and 30 per cent.

 

Mining operations are scheduled to begin in 2028 and are projected to continue for 38 years.

 

Japanese companies expand mining partnerships

 

JBIC is not the only Japanese entity showing interest in Reko Diq. Komatsu, a leading mining equipment manufacturer, signed a $440 million agreement earlier this year to supply heavy machinery for the project. The company also plans to establish a unit in Karachi and deploy experts from Japan and other countries.

 

Japan’s involvement extends through the Asian Development Bank (ADB), where Japan and the US each hold a 15.5 per cent stake, making them the largest shareholders. All ADB presidents to date have been Japanese nationals. In August, the ADB approved loans worth $300 million and extended a $110 million credit guarantee for the Reko Diq project.

 

Copper’s strategic role in the energy transition

 

Copper is critical to global industries, powering renewable energy infrastructure, electric vehicles, batteries, smartphones and data centres. However, the International Energy Agency (IEA) warned in a May report that copper and lithium face major shortfalls, with mined supply from announced projects expected to lag far behind projected demand by 2035.

 

With global copper shortages looming, Japan’s rising investment in Reko Diq underscores its strategy to secure long-term access to critical resources, while enhancing Pakistan’s potential as a key supplier to global export markets.