Oil, Crypto, or Rare Earths? Unpacking Donald Trump’s Renewed Affection for Pakistan
By TOI World Desk | Updated: August 13, 2025
US President Donald Trump’s recent overtures toward Pakistan have sparked significant attention and debate, particularly in New Delhi. The warming ties between Washington and Islamabad span multiple sectors including energy, cryptocurrency, and rare earth minerals—a trifecta with potential geopolitical and economic implications amid ongoing regional tensions.
Strategic Context: India-Pakistan Dynamics and US Involvement
This diplomatic shift by Trump unfolds against the backdrop of strained India-Pakistan relations, dramatically intensified after a terror attack in Pahalgam, Jammu & Kashmir, which India attributes to Pakistan-backed militants. Claiming credit for averting war between the two nuclear-armed neighbors, Trump has praised Pakistan’s military leadership and supported trade deals that culminated in Islamabad’s imminent first-ever import of US crude oil.
While Pakistan has welcomed Trump’s engagement as a diplomatic success, Indian officials and experts remain wary, interpreting Washington’s maneuvers as driven by a blend of strategic calculations, economic interests, and political motives, especially aimed at countering China’s growing influence in South Asia.
US-Pakistan Energy and Trade Breakthrough: First US Crude Oil Shipment
Later this year, Pakistan is set to receive its inaugural shipment of American crude oil, marking a historic moment in bilateral trade. Under a recently announced agreement, Cnergyico, Pakistan’s largest refinery, has signed a contract with global energy trader Vitol to import one million barrels of US crude.
Vice Chairman Usama Qureshi confirmed to Reuters that oil remains Pakistan’s largest import commodity, valued at $11.3 billion for the fiscal year ending June 30, 2025, representing nearly 20% of the country’s total imports. This deal follows trade negotiations initiated in April after Trump threatened tariffs on Pakistani imports, illustrating a complex balance between trade incentives and geopolitical strategy.
Trump has also pledged US assistance to help Pakistan tap into what he described as "massive oil reserves," signaling a longer-term energy partnership.
A Cryptocurrency Alliance with Trump-Linked Entities
In a parallel development, Pakistan is deepening its technological collaboration through a surprising partnership with a US-based crypto firm linked directly to the Trump family. World Liberty Financial—a decentralized finance platform with approximately 60% ownership by Trump family members—signed a preliminary agreement with the Pakistan Crypto Council in April to accelerate blockchain innovation and promote stablecoin adoption.
This deal occurred just days after the Pahalgam terror incident, underscoring Pakistan’s simultaneous pursuit of economic modernization amid security challenges. Key Trump family members occupy leadership and advocacy roles within the firm: Donald Trump as Chief Crypto Advocate, sons Eric and Donald Jr. as Web3 Ambassadors, and Barron Trump titled DeFi Visionary.
Prime Minister Shehbaz Sharif and Pakistan Army Chief General Asim Munir formally welcomed a World Liberty delegation, signaling the government’s commitment to integrating decentralized finance solutions.
Pakistan Nominates Trump for Nobel Peace Prize
In recognition of what Islamabad views as Trump’s pivotal role in reducing bilateral tensions, Pakistan has officially nominated him for the 2026 Nobel Peace Prize. Pakistani officials credited his “decisive diplomatic intervention and pivotal leadership” for easing conflict risks, a claim Trump himself has repeatedly highlighted—albeit to scepticism in India and elsewhere.
Trump has expressed ongoing frustration for being overlooked by the Nobel Committee, contrasting his record with that of former President Barack Obama. Pakistan’s army chief is scheduled to attend a White House lunch with Trump following the nomination endorsement.
Minerals and Rare Earths: The Underlying Economic and Security Motives
Beyond energy and crypto, US strategic interests in Pakistan appear to prominently include untapped deposits of rare earth minerals—essential components in electronics, defense technologies, and clean energy solutions. The Washington Post notes growing Washington concerns over reliance on China, the world’s dominant supplier, especially as geopolitical rivalries intensify.
US officials have engaged with Pakistan’s mineral sector, attending the Pakistan Minerals Investment Forum in April. However, security risks persist: insurgent violence in Baluchistan and militant activity in Khyber Pakhtunkhwa pose threats to mining and infrastructure projects critical to US-China competition.
Counterterrorism Cooperation and Military Engagements
The Trump administration’s rapprochement with Pakistan also emphasizes counterterrorism collaboration. General Michael Kurilla, head of US Central Command, praised Pakistan as a “phenomenal partner,” citing the extradition of terrorists implicated in attacks against US interests.
Army Chief General Asim Munir’s multiple visits to the US, including a unique private White House lunch with Trump, underscore the deepening military ties, though his visits have sparked protests from supporters of former Pakistani Prime Minister Imran Khan, who accuse the military of undermining democracy.
Meanwhile, the US designated the Balochistan Liberation Army (BLA) and its armed wing as Foreign Terrorist Organizations, signaling a joint commitment to counterterrorism that aligns with broader geopolitical agendas.
Looking Ahead: A Complex Triangle of Interests
Donald Trump’s newfound closeness with Pakistan reveals a multifaceted agenda: energy diversification, crypto innovation, access to strategic minerals, and military cooperation—all components of a broader US strategy to balance India, counter China, and strengthen influence in South Asia.
For India, Trump’s engagements represent a complex challenge, with implications for regional stability and diplomatic relations. Observers will watch closely whether Washington’s policy leads to sustainable peace or further geopolitical recalibration.
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