Seeking industry status for mining sector: SIFC directs PD to send summary to ECC
ISLAMABAD: The Special Investment Facilitation Council (SIFC) has directed the Petroleum Division to move a summary to the Economic Coordination Committee (ECC) of the Cabinet recommending that the mining sector be formally declared an industry, well-informed sources told Business Recorder.
At a recent SIFC meeting, the Power Division reported that it had shared its comments with the Petroleum Division on December 3, 2025. The Petroleum Division confirmed that it had received input from all relevant stakeholders.
During the meeting, participants underscored that the mining sector plays a vital role in national economic development. Despite Pakistan’s abundant mineral wealth, mining has long remained underdeveloped. Elevating the sector to industrial status, the meeting noted, would unlock significant economic, social and administrative benefits. The SIFC emphasized the importance of formally recognizing mining as an industry.
The Council advised the Petroleum Division to submit a summary to the ECC/Cabinet with positive and supportive recommendations to facilitate expeditious approval. The federal government is expected to grant industry status to the mining sector in order to support its development in coordination with provincial regulations.
Under the Constitution, minerals—other than mineral oil, natural gas and nuclear substances, and those found in federally administered areas (Islamabad Capital Territory and offshore beyond territorial waters)—fall under provincial jurisdiction. Provincial governments regulate mineral exploration and production and issue mineral titles for such operations.
The federal government’s role is facilitative and includes geological surveys, policy formulation, fiscal incentives and national and international coordination. Currently, more than 5,000 mines operate in the public and private sectors, producing chromite; copper ores (with gold and silver); iron and lead-zinc ores; coal; rock salt; limestone; gypsum; barite; bentonite; fireclay; marble; granite; sandstone; emerald; ruby and other minerals. These operations employ over 300,000 people and are dominated by small-scale mining activity.
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According to sources, only a few large-scale mining projects exist, and the mining sector’s contribution to GDP remains marginal—about one percent. If effectively managed, however, the sector could play a transformational role in national and provincial socio-economic development. Pakistan’s natural mineral endowments are estimated to have the potential to contribute up to five percent to GDP.
The All Pakistan Mines & Minerals Association has repeatedly urged the government to recognize mining as a key pillar of the economy by granting it industrial status. The Association argues that such recognition would yield multiple benefits, including: (i) collateralization of mineral titles/mining leases for bank financing; (ii) concessions in import duty for machinery and equipment; (iii) improved prospects for business joint ventures and consortium formation; (iv) enhanced government support for infrastructure development in mining regions; and (v) priority access to land acquisition.
The sources stated that industrial status would also prompt the government to adopt clearer guidelines on environmental protection, rehabilitation, resettlement and skill development, boosting investor confidence and expanding employment opportunities.
There is no specific law governing the grant of industry status to a business or economic activity. Section 2(xvi) of the Industrial Relations Act, 2012—which addresses labour-related matters—defines an industry as any business, trade, calling, employment or occupation involved in the production of goods or provision of services in the Islamabad Capital Territory and operating in more than one province, excluding those established exclusively for charitable purposes. Following the 18th Amendment, the subject of “industries” was devolved to the provinces. Several sectors had been declared as industries through notifications issued mainly by the Ministry of Industries & Production between 1990 and 2009. Those notified industries received various incentives, including: (i) exemption from mandatory minimum equity limits (USD0.3 million); (ii) borrowing from the State Bank beyond capital limits; (iii) tariff parity on machinery imports for both industry and business;(iv) tariff concessions (5 percent customs duty and zero percent sales tax) on import of non-local machinery; and (v) specific concessions on electricity and gas charges. The Prime Minister’s Office recently constituted a high-level committee headed by the Federal Minister for Power — with representation from federal and provincial departments and sector experts — to propose measures for optimal development and utilization of mineral resources. After extensive stakeholder consultations, the Committee recommended that the mining sector be formally granted industry status.
Although regulatory authority for mineral exploration and production (other than natural gas and nuclear substances) rests with provincial governments, industry status is intended to apply uniformly across the country. Credit facilitation and fiscal incentives fall within the federal domain therefore, the Petroleum Division is processing the matter under its mandate in the Rules of Business, 1973.
Copyright Business Recorder, 2025