Ministry of Commerce backs creation of Minerals Division

ISLAMABAD: The Ministry of Commerce has supported a proposal to establish a dedicated Minerals Division, similar to the Petroleum Division, for specialized oversight and efficient coordination between the federal and provincial governments through the Council of Common Interests (CCI).

The gemstone sector in Pakistan possesses vast potential to drive economic growth, generate foreign exchange, and create employment opportunities.

The country is endowed with rich deposits in Gilgit-Baltistan, Khyber Pakhtunkhwa, d that and Balochistan, where valuable stones such as emeralds, rubies, aquamarines, and topaz are found in abundance.

Govt decides to create ‘Minerals Division’

Despite this natural wealth, the sector remains underdeveloped due to challenges such as unregulated mining, limited value addition, widespread smuggling, and the export of unprocessed gemstones.

Recognizing these issues, the Standing Committee of the National Assembly proposed the establishment of a dedicated authority for gemstone exports under the Commerce Division.

At the same time, the Ministry of Industries and Production is also considering a similar proposal, while Gul Asghar MNA has suggested the creation of a separate division for the minerals sector during a meeting of the Standing Committee on Commerce. This brief examines the need for a Gems Authority that oversees the entire value chain from mining to export and assesses which government division would be most suitable to host it.

The Ministry of Commerce is of the view that the case for establishing a dedicated Gems Authority is strong. Pakistan’s gemstone exports currently range between five to seven million dollars annually, which represents only a small fraction of the estimated potential, if the sector is properly developed.

A specialized organisation could bring together various fragmented functions by ensuring environmentally responsible mining practices, promoting training in gemstone cutting, polishing, and certification, and improving access to modern technology for value addition. It could also enhance marketing efforts in major international markets such as China, Thailand, and Europe.

By managing the full value chain, the organisation would help eliminate illicit trade, enforce quality assurance systems similar to those of the Gemological Institute of America, and attract foreign investment through public and private sector collaboration.

The Commerce Ministry further stated that determining the most appropriate administrative placement for this authority requires careful consideration of institutional mandates and sectoral linkages.

The Commerce Division, with its focus on trade promotion, export facilitation, and international cooperation, presents a strong case for managing the export-oriented components of the gemstone industry.

The Division could make effective use of the Trade Development Authority of Pakistan to organize international exhibitions, build trade linkages, and expand market access. However, its existing structure primarily deals with downstream activities and may not adequately address issues related to mining regulation, production, and local processing.

The Ministry of Industries and Production has offered a more comprehensive framework for developing the sector. The Ministry has successfully managed integrated approaches in other sectors such as automobiles, demonstrating its institutional capacity.

Placing the Gems Authority under this Ministry would allow closer coordination with industrial estates, skill training programs under the National Vocational and Technical Training Commission, and mineral processing initiatives. This arrangement could support the development of cutting and polishing hubs in Peshawar and Swat, generate employment for artisans, and reduce the export of unprocessed gemstones.

“The proposal by Gul Asghar MNA to create a separate Minerals Division also deserves serious consideration. The minerals sector, including gemstones, has unique geological, environmental, and fiscal characteristics that differ from other industrial or commercial sectors,” said the Commerce Ministry.

It stated that establishing a dedicated Minerals Division, similar to the Petroleum Division, would allow for specialized oversight and efficient coordination between the federal and provincial governments through the Council of Common Interests.

“Such a Division could collaborate closely with the Geological Survey of Pakistan for resource mapping, regulate mining operations to ensure compliance with laws, and promote environmentally sustainable practices. This structure would ensure that gemstone development is managed comprehensively and effectively,” the Commerce Ministry maintained.

The ministry has also proposed that the standing committee may guide on the appropriate institutional placement of the proposed Gems Development entity, as it believes that the establishment of this entity would help formalize the gemstone sector and could potentially increase exports tenfold within the next decade.

Copyright Business Recorder, 2025