This year’s ceiling for the US Department of Defense (DoD) stands at $895 billion. For the Pentagon, neodymium (Nd), praseodymium (Pr), antimony (Sb) and cobalt (Co) are classified as “strategic materials”. Rare earth elements (REEs) – 17 in all – power the modern arsenal: F-35 jets, missile guidance, submarines, drones, satellites, lasers, radars, hypersonic vehicles, electronic warfare suites, sonar arrays, night-vision systems, precision-guided munitions, stealth coatings, directed-energy weapons and secure communications.
For the DoD, the battle now is not only in kinetic theatre; it is in the supply chains. For the DoD, China’s near-monopoly over Nd and Pr is viewed as a “‘ill switch’. DoD’s 2025 priorities: stockpile what matters, secure the metals that win wars. Yes, the DoD is seeking partners in Neodymium (Nd) and Praseodymium (Pr) in South Asia.
The DoD is actively funding a ‘mine-to-magnet’ chain. The DoD has begun investing hundreds of millions of dollars in companies in the supply chain. The DoD invested $400 million in preferred stock purchases in MP Materials plus a $150 million loan to upgrade rare-earth processing facilities. Yes, the DoD is offering a 10-year guarantee to buy magnets produced and a $110 per kg price floor for NdPr. In sum, the hard cash investment in MP is $550 million so far. But when including the contingent liabilities from price-floor guarantees and offtake contracts, the total DoD commitment runs into the multibillion-dollar range.
Red alert: The DoD Strategic Materials Board meets in November 2025. Pakistan must move now. Start with antimony (Sb). Deliver commercial metal in the next three months to generate immediate cashflow. Simultaneously run NdPr (neodymium-praseodymium) to oxide/metal conversion on an 18-month timetable. Do both in parallel. Do not wait to finish one before starting the other.
We must ask the Defense Logistics Agency (DLA) for a stockpile offtake on Sb tied to the ammunition supply chain modeled on MP’s deal (price floor, 10-year tenor, upside-sharing). Use the DLA offtake to lock demand and price. Use the Sb cash flow to finance and de-risk the longer NdPr value chain.
There are four prerequisites to this window that has just opened up for us: rapid permitting, regulation clarity, environmental compliance and anti-corruption safeguards. Foreign partners will not work with us without the four.
Remember: for foreign investors there are four non-negotiables: expedited permits; clear, predictable regulation; strict environmental compliance; and enforceable anti-corruption safeguards. Foreign partners will not commit real money without them. Get these four right and promises will become pipelines.
Here’s the best part: Phase-1 requires no Pakistani sovereign cash. Finance Phase-1 with a ready-made stack: EXIM covers up to 40 percent of capex; DFC supplies roughly 40 per cent in the form of senior debt and political-risk cover; the foreign partner provides 20 per cent equity; DPA Title-III and IBAS grant closes any residual gap. We must lock the risk package and, watch, large amounts of capital and offtake follow. Turn geology into guaranteed cash. Convert rock into bankable revenue.
The writer is a columnist based in Islamabad. He tweets/posts @saleemfarrukh and can be reached at: [email protected]
