LAHORE: A recently tabled bill in the Khyber Pakhtunkhwa Assembly by the ruling Pakistan Tehreek-e-Insaf (PTI) to regulate investment in the province’s mining and minerals sector has sparked sharp debate, drawing criticism from opposition parties, allies, and even voices within the PTI itself.
Opponents argue the proposed law threatens to undermine provincial autonomy and hand greater control of Khyber Pakhtunkhwa’s natural resources to the federal government. But the KP government maintains the legislation has been misunderstood and insists it is designed to curb illegal mining and attract investment.
The bill was introduced in the provincial parliament at a time when the federal government is eagerly promoting the country’s mineral reserves to attract foreign investment.
Last week, Pakistan hosted an international summit on minerals, which was attended by foreign dignitaries from across the globe.
Prime Minister Shehbaz Sharif and Army Chief General Asim Munir both spoke at the event, highlighting Pakistan’s potential to generate “trillions of dollars” of revenue through its mineral sector.
Notably, the federal government’s Special Investment Facilitation Council (SIFC) - a high-powered body comprising civilian and military leadership, formed in 2023 to attract investment in Pakistan - has identified the country’s mining and minerals sector as one of five key areas with high investment potential.
On April 4, the PTI government in KP introduced the Khyber Pakhtunkhwa Mines and Minerals Bill 2025, presenting it as a move to establish a legal framework to encourage both foreign and domestic investment in the province’s mineral sector.
Among its key provisions is the creation of two new regulatory bodies: the Licensing Authority and the Mineral Investment Facilitation Authority (MIFA).
The Licensing Authority would comprise 10 members, chaired by a director general, along with an additional director general, the province’s chief inspector of mines, and representatives from departments such as forestry, law and environment.
Both the director general and additional director general must be qualified mining engineers or geologists, nominated by the provincial Mineral Development Department.
This body would be responsible for granting, renewing and canceling licences for the exploration and extraction of minerals, and is empowered to declare certain areas as mineral reserves.
The second entity, the MIFA, would include up to 14 members and be chaired by the provincial minister for mineral development while other members would include ministers for finance, law, environment, industries and relevant bureaucrats.
Currently, the portfolio of minerals is held by Ali Amin Gandapur, the chief minister of KP himself.
MIFA’s role would be to facilitate investment, evaluate royalty payments, and, crucially, “review on its own accord or as suggested by the Federal Mineral Wing” the powers and functions of the Licensing Authority.
The Federal Mineral Wing is defined in the bill as a unit under the Federal Ministry of Energy in Islamabad.
The legislation also outlines the formation of a tribunal to resolve disputes and sets timelines for companies at different stages of mining operations - one year for reconnaissance, four years for exploration, and thirty years for mining leases.
The bill also states that companies planning to undertake “large-scale mining” in the province – with a minimum capital investment of Rs500 million – must enter into joint ventures with a government-owned mining company.
According to the Khyber Pakhtunkhwa Board of Investment, the province has estimated reserves of 14 million tons annually of marble, limestone, dolomite, and other minerals, along with 70 million carats of gemstones.
The opposition Awami National Party (ANP) has come out strongly against the bill.
At a press conference on April 12, senior ANP leader Mian Iftikhar Hussain said the legislation ran counter to the 18th Amendment to the constitution, which devolved several powers from the federal government to the provinces.
“On one hand you (PTI) say we are fighting with the federal government, but what kind of a fight is this that you are willing to sell the province [and its resources],” he said.
A day earlier, the Pakhtunkhwa Milli Awami Party (PkMAP), a PTI ally in the National Assembly, called the bill a “direct assault” on provincial autonomy, constitutional federalism, and the economic rights of the province’s people.
“Hidden behind investment-friendly jargon is a clear attempt to hand over the province’s natural wealth to unelected federal forces,” read a statement from the party.
Media reports suggest that dissent is also brewing within the PTI itself, with some members raising concerns about the bill’s implications and intent.
In a recorded video message on April 9, Khyber Pakhtunkhwa Chief Minister Gandapur dismissed the criticism as “mere propaganda”.
“Let me repeat that the bill is not giving any kind of powers of the province to someone else like the federal government or to any institution,” Gandapur said.
He said that the legislation aims primarily to crack down on illegal mining by setting up a Mines and Minerals Force and provincial-level oversight committees – comprising cabinet members – were being introduced to curb corruption in the sector.
Khyber Pakhtunkhwa’s Information Advisor, Barrister Muhammad Ali Saif, told The News that the bill was drafted entirely by the provincial law department, with input from consultants.
Saif rejected the claim that the Licensing Authority or the MIFA taking suggestions from the Federal Mineral Wing amounts to an encroachment on provincial autonomy.
“We cannot ignore the fact that we are part of the federation of Pakistan, and if there is some recommendation from them [the center], the provincial government will give it due consideration,” he said. “But this does not mean they can dictate us or we are surrendering our powers.”
In some areas, Saif added, federal input would be necessary, for instance, if “strategic minerals” like uranium are discovered in the province. “In such cases, of course they [centre] would have overarching access,” he added.
Rida Hosain, a Lahore-based lawyer, told The News that following the 18th Amendment, minerals are constitutionally a provincial subject.
“The people are the owners of these resources. The provincial government holds these resources in trust for the people and must deal with them in a manner that benefits their people,” she said.
Hosain pointed out that Section 6(2)(c) of the bill states the Licensing Authority “shall give due consideration” to recommendations or guidance from the Federal Mineral Wing.
She also notes that Section 65(c) states that the government of Khyber Pakhtunkhwa may enter into a mineral agreement with a company, provided that the agreement is “substantially in the form of the model Mineral Agreement suggested by the Federal Mineral Wing.”
“The bill entrenches the role of a federal entity in provincial matters,” Hosain said. “The function of the Federal Mineral Wing undermines the independent decision-making of the province.”
However, Karachi-based lawyer Zahid F. Ebrahim disagrees with concerns about federal overreach.
“I don’t see how it would erode provincial autonomy,” he told The News. “I suppose one could take issue with the inclusion of one member of the Federal Mineral Wing among the 14-plus members of MIFA, but that really is not meaningful and would have no consequence.”
Ebrahim added that the bill uses non-binding language like “guidance,” “may,” and “suggestions” in describing the Federal Mineral Wing’s role.
“The only mandatory provision is that large-scale mining contracts must substantially follow the model Mineral Agreement suggested by the Federal Mineral Wing and approved by the government after review by MIFA. I also do not see much basis to take issue here,” he said.