By Fateh Shah Arif:
Peace, stability, and good governance are deeply intertwined. A dignified and progressive society thrives under strong legal frameworks that ensure rights, responsibilities, and accountability for all—from local villages to international borders. The quality of life improves significantly when laws are not only inclusive and research-driven but also practically enforced across all tiers of governance.
In this context, the legislative framework governing Pakistan’s mining sector has long been outdated and in dire need of reform. The Mines and Minerals Harmonization Act, 2025, developed under the guidance of the Special Investment Facilitation Council (SIFC), is a landmark initiative intended to modernize mineral policies, align provincial regulations, and attract domestic and foreign investments. However, while the effort to unify mining laws is commendable, its execution has sparked controversy—especially around issues of provincial autonomy and stakeholder inclusion.
Historical Background and Legislative Gaps
Despite this, most provinces continued relying on colonial-era legislation, including the 1923 Act and the Mineral Rules of 2002. In 2014, the federal government urged provinces to enact their own updated laws. Only Khyber Pakhtunkhwa and Sindh responded, passing their respective laws in 2017 and 2021. Other provinces, including resource-rich Balochistan, did not take timely legislative action.
The growing global demand for critical and strategic minerals necessitated a shift in policy. Recognizing this, the SIFC launched the Mineral Harmonization Framework in 2023 following the first Pakistan Minerals Summit in August 2022. The goal was to develop a unified strategy for modernizing the sector, especially in provinces like Balochistan and KP, which possess abundant mineral reserves.
Controversial Rollout and Stakeholder Exclusion
Although initial consultations involved all provinces and stakeholders, the process lacked transparency in later stages. The federal government’s decision to send the draft Act to provincial chief secretaries with the label “Immediate and Confidential”—bypassing law departments and legislative scrutiny—fueled public skepticism and political backlash. A significant decision taken at a November 2024 meeting, where it was agreed that final drafts would be shared with stakeholders before approval, was not honored. Instead, the draft was approved unilaterally by the SIFC Apex Committee on January 2, 2025.
This top-down approach, seen as ignoring provincial inputs and constitutional norms, has led to protests by the mining community and criticism from political parties in KP and Balochistan.
Major Concerns and Grey Areas in the Act
- Federal Mineral Wing (FMW): The inclusion of the FMW in the Act—without clearly defined Terms of Reference—has been viewed as a violation of the 18th Amendment. Stakeholders have urged that this wing either be removed or its role restricted strictly to investor facilitation, not operational control or revenue matters.
- Composition of MIFA: The Mineral Investment Facilitation Authority includes two representatives from the FMW. Their roles are undefined, raising fears of federal overreach into provincial domains such as royalties, licensing, and local profit sharing.
- Licensing Authority Exclusion: The exclusion of local mine owners and provincial law department representatives from the licensing process undermines transparency. Previously, these stakeholders ensured legal compliance and protected local rights.
- Provincial Profit Share: The Act fails to guarantee provinces a fixed profit share from federal mining operations. Stakeholders recommend securing at least 25% for provinces and allocating 10% for local tribes to prevent unrest and foster trust in mining regions.
- Small-Scale Mining Constraints: The proposed requirement for a Rs. 10 million bank statement to obtain mining leases could marginalize small-scale miners and encourage submission of fake documents. Instead, stakeholders propose increasing the application fee to generate real revenue while protecting local interests.
- Lease Duration: The new Act suggests a 10-year lease period, down from the 30-year provision in the 1948 Act and 2002 Rules. Stakeholders demand restoration of the 30-year term to ensure operational viability and investor confidence.
- The Mines and Minerals were the property of Provinces before 18th Constitutional amendments and still the property of the provinces. However after 18th Constitutional amendments the right of the provinces on even strategic Minerals recognised by Federal government.However, the policies and Acts, 1923 and 1948 were developed subsequently in British era and during one unit after partition of subcontinent. Due to these old policies the Federal government requested all provinces to develop their own policies and Acts according to their requirements in light of international market demands.
The Way Forward
The Harmonization Act 2025 is a comprehensive 139-page document developed through over a year of consultation. While it has many strengths, it also contains critical flaws that must be addressed to ensure it supports both national interests and provincial rights. Rather than rejecting the entire framework, provincial assemblies should engage in detailed review processes—incorporating stakeholder recommendations and upholding constitutional principles.
If revised thoughtfully, the Act has the potential to unlock Pakistan’s vast mineral wealth, attract responsible investment, and ensure fair benefits for local communities and provincial governments. Collaboration, transparency, and mutual respect between federal and provincial stakeholders are essential for realizing this vision.
About the Author:
Fateh Shah Arif is the Secretary General of the All Pakistan Mines and Mineral Association (APMMA). He has been actively involved in mining sector advocacy and policy development across Pakistan.
Email: fatehshah2002@gmail.com | fatehshah@apmma.com
