Another Reko Diq scandal?

Published: July 10, 2014
The writer is a defence and security analyst and chairman of the Pathfinder Group as well as director of the East West Institute

The writer is a defence and security analyst and chairman of the Pathfinder Group as well as director of the East West Institute

Located in the sparsely populated Chaghi district in northwestern Balochistan and accessible from the Quetta-Zahedan highway, Reko Diq has extreme weather, ranging from searing summers to freezing winters. High wind and sandstorms demobilise local activities and trade. A large low-grade copper porphyry deposit, Reko Diq has mineral resources totalling 5.9 billion tons of ore with an average copper grade of 0.41 per cent and gold grade of 0.22 grammes/ton. The economically mineable portion has been calculated at 2.2 billion tons with an average copper grade of 0.53 per cent and gold grade of 0.30 grammes/ton.

Reko Diq’s annual production is estimated at 200,000 tons of copper and 250,000 ounces of gold from 600,000 tons of concentrate. At today’s international prices, the profit worked out by Tethyan Copper Company (TCC) is about $1.14 billion for copper and $2.5 billion for gold, totaling $3.64 billion approximately annually. The TCC’s calculation of a $200 billion-plus profit over the 55-year life of the mine is disputed, higher estimates ranging up to $450-500 billion.

BHP Billiton initially signed the exploration licence with the Balochistan government in 1993, forming the TCC later in Australia, having 75 per cent and 25 per cent stake respectively. With gold and copper established in substantial quantity, BHP sold its stake, 37.5 per cent each to the Chilean conglomerate, Antofagasta Minerals, and Canadian company Barrick Gold.

Who gave the waiver to BHP Billiton to palm off its 75 per cent share in the TCC, and at what profit, even before a ton of ore was mined? Why were the Chileans and Canadians risking life and limb, as well as their investments, in such a dangerous area? And most mysterious of all, why were they not making the smelting plants in Pakistan, instead of shipping the concentrate abroad?

Malik Riaz Hussain, a renowned land developer, claimed in mid-June 2012 that Arsalan Iftikhar, son of the then chief justice of Pakistan, Iftikhar Chaudhry, had blackmailed him out of $3.63 million over a three-year period. Receipts, housing agreements and even passport and flight details were produced by an associate of Malik Riaz (and Arsalan’s friend) about Arsalan’s trips and hotel stays in London and Monte Carlo. While Arsalan termed the allegations “propaganda”, his father launched a preemptive judicial strike, taking suo-motu action to initiate an investigation against his own son. Shoaib Suddle uncovered a lot of incriminating evidence against both, Malik Riaz and Arsalan, recommending their prosecution for massive tax evasion. Both having a lot to lose, a compromise seems to have been reached.

Arsalan is not new to controversy reflecting negatively on his father, who was accused of getting him into medical school despite insufficient grades and then getting him rapidly promoted in his first government assignment. Later, controversially appointed vice-chairman of the Balochistan Investment Board, Arsalan immediately honed in on the Reko Diq gold mines, announcing an open global tender. Jan Buledi, official spokesperson for the Balochistan government, said his government was “acting on advice from the federal government, trying to reach an out-of-court settlement with the TCC as it would not be able to bear the financial losses in case a financial penalty is inflicted by the International Court of Arbitration”. Revealingly, Buledi added, “It will be unfair to prevent the TCC from participating in the bidding for a licence.” The legal lacuna was created on January 7, 2013 when a three-member Supreme Court bench, headed by Arsalan’s father, declared the July 20, 1993 agreement between the Balochistan government and the TCC void. Is it really a coincidence that the former chief justice plans to establish a ‘consultancy office’?

Attracting widespread criticism, Arsalan was forced to resign within 12 days into the Reko Diq controversy. Defending Arsalan’s appointment, a PML-N stalwart, Mushahidullah Khan, touted this as a “reward” for Iftikhar Chaudhry’s “many services to the nation”. Was this a reward for services rendered to the nation or to the PML-N? Arsalan’s federally-inspired appointment was ‘Reko Diq-specific’. Who else was in on the attempted scam?

Arsalan Iftikhar is desperately trying to divert attention from the scam by attempting Imran Khan’s character assassination and subsequent disbarment by the Election Commission of Pakistan. Bereft of his feared seat of power, can Arsalan’s father rely on colleagues in his former power base to aid and abet in his machinations?

Published in The Express Tribune, July 10th, 2014.

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Reader Comments (21)

  • Arifq
    Jul 10, 2014 - 2:40AM

    Follow the trail of money, Arsalan to daddy Ex-CJP then to their patrons the Sharif’s.


  • Nasir
    Jul 10, 2014 - 3:10AM

    Arsalan Iftikhar is just a pawn. What one should look is TCC is offering to other companies including the one created by Iftikhar Chaudhary. Problem is that politicians, bureaucrats and now judiciary all are destroying Pakistan. Army only see’s its own interest. If Armed forces interests are in danger than only they take action in “saving Pakistan” otherwise no one cares if average Pakistani civilians are dying of suicide bombings, terrorism, poverty or by any other factor. In Pakistan’s 66 years history Armed forces have governed the country for half of the time and politicians have ruled for the rest of the half. None ever bothered to put Pakistan’s education, research & development, inventions or any other programs or policies that can benefit future generations of Pakistan. I’m 38 now and back in 80s when I was 8 years old Military regime of Zia-ul-Haq and then subsequent civilian governments until now are not working for betterment of Pakistan rather bent upon minting whatever they can. Now they have organized by including other institutions in corruption the likes of Arsalan Iftikhar and his father. Those who are savior of the law and those who suppose to implement all are corrupt and against their own motherland. Such is a sorry state of this accursed country of Pakistan.


  • Malveros
    Jul 10, 2014 - 4:43AM

    Another biased article in favor of Imran Khan without any tangible proof. U need to come out of your delusions.


  • Khalid Pathan
    Jul 10, 2014 - 4:55AM

    The same story all the time. Unprecedented corruption by those who are at the helm of affairs in Pakistan. This set of elite is responsible for the pathetic condition the country is in today. It is tragic not to see a silver lining beyond the dark clouds.


  • Aussie
    Jul 10, 2014 - 9:34AM


    I have noted that Ikram Sehgal writes articles that are balanced, informative, and factual. Where is the so-called bias in this article ? What manner of further tangible proof is required?

    How can the article be in favour of Imran Khan, when he is mentioned only in passing in one sentence at the very end.

    Riko Dig is one of the very few assets Pakistan can bank on for its future recovery. Absolute vigilance is necessary at all levels.


  • Jul 10, 2014 - 9:41AM

    As a journalist focused on South Asian politics and security, I found Mr Sehgal’s article very revealing of the corruption that is eroding the entire region, not Pakistan alone. I’m glad he has boldly pinpointed persons in such positions who are responsible for such corruption. All too often we turn a blind eye. Or worse, we search for scapegoats and blame the wrong quarters. In one of the comments above, a certain Nasir has lashed out against the army? I don’t think that is quite relevant in context to what Mr. Sehgal’s column is about. Why divert attention from the actual culprits? It’s not a matter of backing Imran Khan either, it’s a matter of revealing the truth. I wish more of us in the region would continue to castigate corruption without hesitation. Now that is what would make a tangible difference.


  • Hamzah
    Jul 10, 2014 - 9:53AM

    Reading the comments about Ikram Sehgal’s pieces over the past three weeks, it is clear he is being subjected to an inspired and motivated campaign. His articles are informed, well-researched, without bias and objective, yet the comments invariably quote him out of context. Take for example the detailed mention of the Armed Forces in today’s article, I don’t see it mentioned anywhere but the commentator has dwelt at length on this. Reko Diq exposes Iftikhar Chaudhry’s machinations and manipulations. Having been caught with his hand in the cookie jar, the former CJ has launched a diversionary attack relying on his old contacts in the judiciary to rescue him as they have done in the past.


  • Rehana
    Jul 10, 2014 - 12:06PM

    @Malveros: Nobody is favoring Imran Khan, kindly read the article again and extract the true picture. The author is trying to tell the people of Pakistan what we have and how we can utilize it for the betterment of our nation. Author is a true patriot and his patriotism reflects in his writings and articles with due tangible proofs.


  • sabi
    Jul 10, 2014 - 12:37PM

    Why would we need Arsalan for character assassination of IK at this stage when damage is already done by Khan sahib himself.


  • Arzoo
    Jul 10, 2014 - 2:07PM

    @Aussie & @ Hamzah: If it appears that: “Ikram Sehgal’s pieces over the past three weeks” are “being subjected to an inspired and motivated campaign” the responsibility lies on the unbalanced moderation of ET who allow selective comments to go through on criteria which I have not been able to figure out in the last four years. Much too often, comments based on objectivity and written within the parameters are ignored and not published. I too find Ikram Sehgal’s articles balanced, objective, and well-informed. I hesitated to comment as such knowing well that the time and effort will probably be wasted. Your comments encouraged me to send mine. Let’s see if it goes through.


  • A Peshawary
    Jul 10, 2014 - 3:08PM

    Where are champion Investigative journalist on this corruption scandal (one can not dare to mention big name like AA and KK for obvious reason)? Perhaps it is not the time for them to explode with all their might and vigor for which they are famous. They might be silent on the instructions some highly influential people and great master-mind near & dear to them; who behind the scene are interested to create and grab the a tremendous business opportunity to add a new gem to their existing business empire.

    What ever people write or does; Arslan Iftikhar has recently been made a hard core reality and product of our corrupt system which nobody can check and role back. A prime example of judicial system,s exploitation at highest level.

    These stories expose the nexus of political, bureaucratic and judicial authorities at the top duly supported by criminal silence of media giants with the exception few ones like Mr. Akram.

    A Peshawary


  • usman786
    Jul 10, 2014 - 3:17PM

    @Nasir: The country may have been under military rulers half of its age, but its routine jobs were done by civilian ministers and CSP etc. So donot blame them in future if those minister (most of them are now PM, CM) did not perform well. who stopped them?


  • Aamer Mahmood
    Jul 10, 2014 - 3:46PM

    I must say Mr. Sehgal has once again provided a piece of writing which serves as an eye opener to many by emphasising the issues imperative to the nation’s current state! Corruption/tax evasion/ manipulation. Mr. Sehgal’s well thought and fully researched analysis of Riko Dig shows his commitment to use this medium to convey the unbiased opinions and facts that Pakistanis should be aware of. Kudos!


  • Parvez Halim
    Jul 10, 2014 - 4:20PM

    In Bangladesh we take a lot of interests in what is happening in India and Pakistan as this affects us too — the regional domino effect. Ikram Sehgal’s columns are astute and analytical and help us get a comprehensive picture of what is going on in Pakistan. I am surprised as some of the criticism I seen in the comment sector. I would have been proud if a columnist in our country hit out at the corruption of the powerful ones.


  • Shiloh
    Jul 10, 2014 - 4:22PM

    I have no love lost for Musharraf and his 8 years of dictatorial rule. He did the right thing by sacking Justice Iftikhar Chaudhry, he simply went about it the wrong way. Arsalan and Reko Diq exposes this man completely. Well done to the writer for revealing this man’s duplicity and avarice.


  • unbelievable
    Jul 10, 2014 - 5:56PM

    Forget Arsalan Iftikhar – the real bad guy here is his father who arguably used his office to coerce medical school, coerce govt to provide job, and render bogus Reko Diq judgement which will end up costing Pakistan Billions in penalties. Govt should launch an investigation which should send a loud message to the other SC justices.
    BTW – where was the “independent media” when all this was taking place?


  • J. Niaz
    Jul 10, 2014 - 9:55PM

    Another excellent article, clearly pin-pointing massive corruption.
    Comments about Imran Khan bias are unfounded. No one’s comments reflect more adversely on IK than Khan Sahib himself.


  • Saad
    Jul 10, 2014 - 10:57PM

    Well, who is not aware of SUO-MOTU regime that was run in this country and the ratio of judiciously disposed off cases by a Pharaoh. This is an important issue on which future of this country depends. Today there was report from IMF that Pakistan needs around 10 Billion Dollars just to support its next fiscal budget , i was just wondering that are we moving towards yet another IMF bail out package ? with all such Minerals and prospects at hand , we are so helplessly dependent on foreign AIDS ( which are killing us, Care is the only way out). There are few basic questions which must be in everybody’s minds 1. Why cant we explore these resources at our own or at Maximum as a equal partnership ? 2. Why smelting Plants are not installed in Balochistan instead of somewhere abroad ? 3. Why don’t this whole mineral exploration policy base on transfer of technology basis ? so that our people and our firms get trained in it thus increasing our Human Resource and provide a technology leap ? Why?


  • Malveros
    Jul 11, 2014 - 4:56AM

    PTI, Imran Khan sympathizers as well as Musharraf sympathizers are now investigative journalists. They know more than the common man. Surely TUQ will be launching his investigative unit soon. Bias seeps in everywhere without concrete facts. Everything based on hearsay these days.


  • Shahid
    Jul 11, 2014 - 9:57AM

    Burying our head in the sand are we? Whatever helps u sleep at nite.

    No one is doubting the corruption and exploitation of the position of CJ by the Chaudhry clan, the Malik Riaz case was proof enough to the people. Sycophants of course are an exception.


  • Malveros
    Jul 11, 2014 - 5:46PM

    Yeah and PTI has enough of those – Sycophants Galore. Everything uttered by PTI is Virgin Pious Truth according to Deeni-i-Imrani.


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