US President Donald Trump on Wednesday announced a new agreement for the joint development of Pakistan’s oil reserves, as the two countries work on the expansion of trade and economic relations.
Trump posted on his true social platform, “We have signed a deal with the country of Pakistan, making Pakistan and the United States work together on developing its large -scale oil reserves.”
It was not immediately clear that the “large -scale” oil reserves were referring to Trump. According to the central bank data, the accounting for about 20% of the oil Pakistan’s total import bill is Pakistan’s largest import item. Most of that oil decreases from the Middle East.
Nevertheless, Trump called the deal “an important beginning” for a possible long -term energy partnership.
Energy partnership was unveiled by Trump before the White House on Thursday, announced a comprehensive trade agreement with Pakistan on Thursday, and soon the rate of 19% on Pakistani imports in the US. This is less than the previous rate of 29%
Pakistan Hales ‘Landmark Deal’
Both countries received the degree of US Pakistan Trade Agreement. Pakistan Prime Minister Shahbaz Sharif called it a “historic deal”, which “will increase our growing cooperation.”
The Finance Ministry said the deal “mark the beginning of a new era of economic cooperation in energy, mines and minerals, IT, cryptocurrency and other fields,”
On Friday, Pakistan welcomed the new, low, tariff rate, calling it a “balanced and forward -looking approach” from the US.
Azim Khalid, a New York -based international affairs expert Azim Khalid, stated, “This development is on complicated changes in Pakistan – in American relations, a traditional geopolitical and strategic partnership more financially focused on cooperation.”
Pakistan’s tariff rate is less than 25% imposed on the neighboring neighbor India. In announcing the oil deal, Trump took a job in New Delhi, asking that India could buy Pakistani oil one day.
“Who knows, maybe they will be selling oil to India someday!”
However, it seems that so far, the oil is flowing in the opposite direction. On Friday, Reuters News Agency reported that Pakistan’s largest oil refiner, Cnergyico, said it could import 1 million barrels of American crude oil through its trading partner, Witol, a Dutch energy and commodity trading company in October.
“If it is commercially gol and available, we can import at least one cargo per month,” Cnergyico vice -president USama Qurehi told Reuters.
For Pakistani oil, before this deal, Pakistan made several unsuccessful efforts in offshore Indus basin. The traditional crude oil reserve proved by Pakistan is estimated from 234 million to 353 million barrels, which ranks about 50th in the world in terms of oil reserves.
Energy and security
Unused oil reserves are believed to be located in Balochistan, with additional possibilities in Sindh, Punjab and Khyber Pantnankahwa.
As the center of an armed rebel movement that often meets attacks, developing resources in Balochistan presents security problems.
Baloch rebels saw resource extraction as economic exploitation by the federal government of Pakistan and often targeted such projects with attacks.
For business law expert Osama Malik, the extraction of oil from Balochistan can further distinguish a population that is already dissatisfied in search of the province’s mineral resources by China.
Experts have expressed cautious optimism about the recent deal, as it can attract investment, introduce advanced extraction technologies, and facilitate new field surveys. However, the actual extraction of petroleum products is uncertain without confirmed reserves and necessary infrastructure in the place.
“When American companies establish a presence in Balochistan, it is estimated that the extremism will not be at its peak,” a security analyst, Qamar Cheema, told DW.
He said, “The support for the thesis groups decreases, this will lead to lack of extremism or potential elimination,” he said.
American geographical interest in Pakistan
America has strategic interests in Balochistan due to proximity to Iran and Afghanistan.
“Washington focuses on establishing an appearance in Balochistan, rich in minerals and holds significant strategic values due to closeness from Iran,” Cheema said.
Washington sees Balochistan as a potential monitoring and pressure point for Iranian activities, especially between Iran’s nuclear program and ongoing tensions about its regional impact.
The agreement has possible implications as Washington aims to reduce Pakistan’s growing dependence on China.
Business law expert Malik said, “Islamabad has to balance considerable Chinese investment in energy and mineral sector and future investment by the US.”
China is investing billions in developing rail and road links in Pakistan. The $ 65 billion China-Pakistan Economic Corridor (CPEC) project is aimed at shipping Chinese goods through the Zinjiang region across the mountain border through Pakistan and the Jinjiang region in the Arabian Sea at Gwadar port in Balochistan.
“From China’s point of view, the entry of American companies in Pakistan’s resource exploration sector presents a competitive challenge to oil and mineral firms. However, given the historic Douth -China relations of Pakistan, this position can act as a diplomatic bridge rather than a point of material,” said Azim Khalid, an expert in international affairs.
Security expert Cheema, believes that Pakistan depends on China and on the United States, for macroeconomic stability, especially through the IMF.
“The deal prefers to strengthen the economic partnership between Pakistan and the US. In addition, the US wants to establish an alternative alternative in the region,” Cheema said.
Written with content from Reuters
Edited by: Wesley Rahan
