On September 8, 2025, Pakistan and the United States took a decisive step in reshaping the global critical minerals supply chain, signing a landmark $500 million investment agreement that promises both immediate economic impact and the prospect of long-term strategic cooperation. The deal—struck between US Strategic Metals (USSM), a Missouri-based leader in critical minerals processing, and Pakistan’s Frontier Works Organisation (FWO)—was formalized at a high-profile ceremony at the Prime Minister House in Islamabad, attended by Prime Minister Shehbaz Sharif, Chief of Army Staff Field Marshal Asim Munir, and a host of senior officials from both countries.
According to Dunya News, the agreement is not just a financial commitment; it marks a new era of bilateral engagement, with the US Embassy in Islamabad describing it as a move that will "accelerate Pakistan’s mineral exploration and development drive." The USSM delegation, accompanied by Acting Deputy Chief of Mission Zach Harkenrider, was briefed on the nation’s vast reserves of copper, gold, antimony, tungsten, and rare earth elements (REEs)—all minerals vital to the defense, aerospace, clean energy, and technology sectors.
In fact, the deal involves two separate Memoranda of Understanding (MoUs): one focused on the development and processing of critical minerals, including REEs, and another on logistics services to support mining operations. The agreements, as reported by The Express Tribune, also include immediate commencement of mineral exports—specifically antimony, copper, gold, tungsten, and rare earth elements—from Pakistan to the United States. This rapid start is seen as the first concrete step in building a robust, non-Chinese supply chain for minerals that underpin modern manufacturing and national security.
USSM, headquartered in Missouri, is no stranger to innovation in this sector. The company specializes in extracting critical metals from old lithium-ion batteries and mining cobalt, nickel, and copper—resources that the US Department of Energy has identified as "raw materials necessary for our most advanced technologies," according to Eric Meyer, a senior State Department official cited by the US Embassy in Islamabad. For the US, the partnership offers a much-needed diversification of supply chains that have long been dominated by China, especially for rare earths and other strategic minerals.
But the ambitions don’t stop at raw exports. The deal lays the groundwork for a proprietary poly-metallic refinery to be built by USSM in Pakistan, which would produce both intermediate and finished mineral products tailored for US market demand. While this refinery is a longer-term vision, its potential impact is already drawing attention from industry experts and policymakers alike. As Reuters notes, such a facility could ease cost and security pressures for US manufacturers, particularly those in defense and clean energy, by providing a reliable and transparent source of critical inputs.
The significance of the agreement was underscored by the presence of Pakistan’s top leadership at the signing ceremony. Alongside Prime Minister Sharif and Field Marshal Munir, Deputy Prime Minister and Foreign Minister Ishaq Dar, as well as several federal ministers, attended the event. The high-level US delegation included representatives from both USSM and Mota-Engil, a global player in engineering and infrastructure, signaling a broader partnership that extends beyond mining into logistics and infrastructure development.
According to a statement from the Prime Minister’s Office, the next steps under the MoU include forming joint teams to assess Pakistan’s resource base, identify additional critical minerals for export, and build a long-term partnership in exploration, extraction, and processing. The cooperation will prioritize sustainability, profitability, and environmental responsibility—an approach that both sides say is essential for ensuring lasting benefits for their respective economies and communities.
Transparency and innovation are also central to the deal. The parties agreed to explore financing and digital solutions, including the tokenization of minerals, to attract global investors and increase transparency in the sector. This forward-thinking approach, as highlighted by Dawn, is seen as a way to unlock new opportunities for sustainable growth, technology transfer, and job creation in Pakistan, while offering American companies a more secure investment environment.
US Chargé d’Affaires Natalie Baker captured the spirit of the moment, stating, “This signing is yet another example of the strength of the US-Pakistan bilateral relationship that will benefit both countries.” She emphasized that the Trump administration has made the forging of such deals a "key priority given the importance of critical mineral resources to American security and prosperity." Her optimism was echoed by the US Embassy, which expressed hope for additional agreements in the critical minerals sector and reaffirmed Washington’s strategic interest in Pakistan’s mineral wealth.
The timing of the deal is notable. In July 2025, Islamabad successfully negotiated a reduction in reciprocal tariffs with the US—from 29 percent to 19 percent—paving the way for expanded trade. That same month, US President Donald Trump announced a new trade agreement with Pakistan, including joint development of the country’s oil reserves. Prime Minister Sharif publicly thanked President Trump for his "leadership role in finalisation of the historic US-Pakistan trade agreement," and the two sides have since worked to deepen economic ties, particularly in sectors deemed essential for future growth.
Beyond the economic and technological implications, the agreement carries significant geopolitical weight. As The Express Tribune points out, the deal provides US firms with a fresh, non-Chinese source of rare earths and strategic minerals, a move that could shift the balance of power in global supply chains. For Pakistan, the partnership opens doors to value addition, infrastructure development, and integration into high-tech industries—an opportunity that government officials are eager to seize.
During their visit, the US delegation held meetings with Pakistan’s army chief, petroleum minister, and commerce minister, gaining a comprehensive overview of the nation’s mineral reserves and industrial landscape. The companies involved expressed readiness to invest in value-addition facilities, expand processing capacity, and develop large-scale projects linked to mining—steps that could transform Pakistan’s mineral sector into a regional powerhouse.
While challenges remain—particularly the need to ensure the timely realization of the planned refinery and the implementation of sustainability measures—both sides appear committed to making the partnership work. The agreement’s immediate impact will be felt in the form of new exports and investment, but its true legacy may be in the long-term transformation of Pakistan’s mineral industry and the strengthening of US-Pakistan relations at a strategic level.
As the world’s appetite for critical minerals continues to grow, the Islamabad agreement stands as a testament to the power of international cooperation—and to the promise of a future where economic opportunity and security go hand in hand.
