The Soda Ash Plant
Pakistan's most powerful unaccountable body just handed a water-scarce district's public resources to one of the country's wealthiest conglomerates.
Lucky Core Industries exports soda ash to the UAE, Sri Lanka, Saudi Arabia, Qatar, Bangladesh, Tanzania, and Afghanistan. Its plant in Khewra, District Jhelum, has been running since 1944 and now produces 560,000 tonnes per year. It announced in July 2024 that it is expanding by another 200,000 tonnes. Olympia Chemicals, whose primary manufacturing unit sits in Warcha, Tehsil Quaidabad, District Khushab, has been producing soda ash since 2000 and holds roughly 30 per cent of the domestic market. Between them, these two companies cover 90 per cent of Pakistan’s soda ash demand and sell the surplus abroad.
The remaining 10 per cent is covered by imports.
On May 20, 2026, the Special Investment Facilitation Council announced that it had resolved a water supply issue for a new soda ash plant in Khushab, built by Sapphire Chemicals, a wholly owned subsidiary of Sapphire Textile Mills. The stated rationale: import substitution, reduction of forex outflow, industrial development. What the SIFC assembled for Sapphire over the preceding two years to address that 10 per cent gap was not a rescue operation for an industry in distress: publicly owned mineral deposits, state equity capital from a government corporation, water from a canal serving a district in a documented health crisis, a hundred-million-dollar bank facility from an institution whose former chief executive is the Finance Minister, and anti-dumping duties taxing away the last of the foreign competition. An industry that already exports to seven countries did not need rescuing. Something else was happening.
The District
Khushab sits in the Salt Range of central Punjab, a geological band of ancient evaporite deposits rich in rock salt, limestone, coal, and gypsum. Its population of approximately one million is spread across four tehsils: Khushab, Quaidabad, Noorpur Thal, and Nowshera Soan Valley. The district has Olympia’s soda ash plant at Warcha, which has been running since 2000. It also has a water crisis that its own public institutions have been documenting in writing for years.
In 2021, the Khushab Public Health Engineering Department declared drinking water across all four tehsils contaminated and harmful to health, with chloride and fluoride concentrations in dangerous ranges throughout. Dr. Fakhr Abbas Kazmi, the district’s leading radiologist, told The Express Tribune that half his patients presenting for ultrasound had kidney disease; the remainder came in with hepatitis, jaundice, and typhoid. A peer-reviewed study of groundwater across Khushab’s urban settlements found that more than 62 per cent of residents reported dissatisfaction with their water quality and 80 per cent said it had drastically declined. Hospital records from a single year showed 40,000 patients from Khushab city and surrounding villages attending the Tehsil Headquarter Hospital for waterborne illness. A geochemical analysis found fluoride at specific sites reaching 7.9 mg/L, against a WHO safe limit of 1.5 mg/L. A 2025 study examining land use and groundwater quality across the district analyzed 155 samples and found continued deterioration, with contamination linked to industrial and agricultural pressures on an aquifer already beyond its limits. An earlier study concluded that the deterioration was so widely understood locally that it had become a measurable driver of falling property values, meaning the poisoning was being priced into land.
The Salt Range produces elevated mineral content in some groundwater and geology accounts for part of this. Diffuse chloride contamination across an entire district, after 25 years of industrial Solvay process operations generating calcium chloride waste in and near that district, raises a causal question the state has never commissioned anyone to examine. No environmental audit of Olympia’s operations in Khushab has been published. No government report has connected industrial activity in the district to the contamination its own health agencies have been documenting. The state approved a second Solvay plant in this district with no environmental review and no published waste management plan.
What the Process Leaves Behind
Soda ash can be produced two ways. The natural route, used in Wyoming, in Kenya’s Rift Valley, and in Tanzania, mines trona ore and processes it with low energy consumption, minimal waste, and a fraction of the environmental footprint of the synthetic alternative. The synthetic Solvay ammonia-soda process uses salt, limestone, and ammonia to produce sodium carbonate through a chain of reactions that generate substantial heat, release ammonia to the atmosphere through fugitive leaks, and yield one dominant waste product in very large quantities: calcium chloride brine.
A peer-reviewed study published in the Journal of Cleaner Production established that the classic Solvay process generates 10 cubic metres of liquid and solid waste for every tonne of soda ash produced. At 220,000 tonnes per year, the Sapphire plant will produce approximately 2.2 billion litres of industrial waste annually. Limestone calcination in the process releases approximately one tonne of CO2 per tonne of output before fuel combustion, meaning 220,000 tonnes of CO2 per year from this plant alone.
The calcium chloride brine must go somewhere, and where it goes determines whether communities downstream survive it. The Solvay Process Company produced soda ash on the shores of Onondaga Lake in Syracuse, New York, from the 1880s, discharging waste directly into the lake for close to a century. The contamination by chloride, mercury, and industrial solids was so extensive that the lake was classified as one of the most polluted inland bodies of water in the United States. Honeywell International, as the corporate successor to the original operators, spent $451 million on dredging alone. The Onondaga Nation, whose ancestral territory includes the lake, has put the cost of a genuinely comprehensive cleanup at $2.16 billion. The contamination is still being managed today, more than four decades after the plant closed.
A more recent case is less distant. In September 2022, the Belgian chemicals company Solvay SA, which licenses the original process under its own name, was publicly accused of polluting the Mediterranean Sea through its soda ash plant on the Italian coast. The company was forced to announce cuts to its waste discharges. That plant has ocean access; oceanic dilution was what made its operation viable. When that option became publicly untenable, the company had no alternative ready.
Khushab is 900 kilometres from the nearest coast.
Cooling water drawn continuously from the Muhajir Branch Canal for the Solvay process will be returned to the environment warmer than it arrived, producing thermal pollution that affects downstream organisms and the germination of irrigated crops. The process runs continuous ammonia cycling, and fugitive ammonia releases are a documented hazard at every Solvay installation in the world. The plant will require large, continuous quantities of limestone that must be quarried from the Salt Range.
There is no published waste management plan for the Sapphire plant. There is no Environmental Impact Assessment in the public record.
A Country With Nothing Left to Allocate
Pakistan crossed the international water scarcity threshold of 1,000 cubic metres per capita in 2005. Current availability stands at approximately 908 cubic metres per person, according to the Pakistan Council of Research in Water Resources, projected to fall toward 860. The IMF ranks Pakistan third among nations facing acute water shortage. The 2023 UN Global Water Security Assessment placed it fifth among the 23 most water-insecure countries in the world. Pakistan Water Week 2025, held in Islamabad in November, produced a clear consensus among water institutions: without urgent reforms, the gap between Pakistan’s water availability and national demand will continue to widen.
The canal system through which most of that water moves is under structural pressure independent of any single allocation. The Indus River System Authority declared a 43 per cent water shortage for early Kharif 2025. Punjab received a 22 per cent shortfall during Rabi 2024-25. Canal head withdrawals nationally declined by 4 per cent that year. In March 2025, IRSA reported that only drinking water was available in some systems.
The Muhajir Branch Canal in Khushab serves agriculture and, because groundwater in the district is already unsafe, functions as a drinking water source for a significant portion of the population. It is not an industrial supply line. In June 2024, the SIFC allocated 2.5 cusecs from this canal to the Sapphire project. In May 2026, it allocated a further 2.7 cusecs. Whether these are cumulative or whether the second supersedes the first has not been clarified by any government department. One cusec is approximately 28.3 litres per second. At the higher cumulative figure, the continuous industrial draw on this canal would be roughly 147 litres per second, every second, indefinitely. A Solvay plant does not draw water occasionally. It draws for salt dissolution, ammonia absorption, product washing, and cooling without interruption. This allocation is a permanent claim on a public resource serving an already water-scarce district, made through a body that held no public hearing, produced no water rights assessment, and created no compensation mechanism for downstream users.
The farmers whose fields depend on the canal below the new industrial offtake were not consulted. Their Punjab Assembly representatives were not asked. The Punjab Irrigation Department conducted no public review. The SIFC’s apex body, whose membership includes the Chief of Army Staff, made the decision in meetings whose records have not been published. There is no court with jurisdiction over these allocations and no legal mechanism by which a farmer in Quaidabad can bring a claim.
The State’s Investment in a Private Balance Sheet
Pakistan Mineral Development Corporation, a government body under the Ministry of Energy (Petroleum Division), signed a memorandum of understanding with Sapphire Chemicals on October 3, 2024. The document commits PMDC to supplying 360,000 tonnes per year of rock salt from its Khushab project at industrial quality. It also records that PMDC will inject 10 per cent equity into the plant. The MOU is explicitly labeled non-binding.
That label has specific legal force. PMDC’s equity commitment to a plant financed at over $100 million is a public investment potentially exceeding $10 million. No Cabinet approval for this injection appears in the public record. No parliamentary committee has reviewed whether the Ministry of Energy is authorised to commit state capital to a privately managed chemical plant belonging to one of Pakistan’s wealthiest family groups. The non-binding nature of the agreement means Sapphire can accept the mineral supply, renegotiate equity terms from a position of leverage at a later stage, or walk away entirely without legal consequence. PMDC has no enforceable claim.
There is a second layer of state exposure that has not appeared in coverage of this deal. The National Investment Trust, a state-managed fund, holds approximately 4.6 per cent of Sapphire Textile Mills, the listed parent company. Pakistani taxpayers were already shareholders in the parent before PMDC committed equity to the unlisted subsidiary. The state is deepening its financial stake in a private family group through two separate institutional channels, without a public record linking the decisions or explaining why the public interest is served by either of them.
In December 2025, Habib Bank Limited led a $100 million syndicated financing facility for the plant. HBL is 51 per cent owned by the Aga Khan Fund for Economic Development. Muhammad Aurangzeb served as HBL’s chief executive for six years before becoming Pakistan’s Finance Minister in March 2024. The syndicate closed while he held the Finance portfolio. The anti-dumping duties protecting the market Sapphire will enter were administered through the National Tariff Commission, which coordinates with the Finance Ministry on trade remedy decisions. The former head of the bank that provided the financing was simultaneously the minister responsible for the policy environment that makes the project viable. This connection has not appeared in any coverage of this deal.
The IMF addressed the broader architecture in its November 2025 Governance and Corruption Diagnostic Report, a 186-page assessment of Pakistan’s institutional landscape. The report described corruption as “persistent and corrosive,” characterised the state apparatus as frequently exploited to benefit particular groups at the expense of the general population, and specifically called for SIFC to publish its first annual report detailing all facilitated investments and the tax, regulatory, and legislative concessions provided alongside them. It documented that tax expenditures and concessions for powerful sectors cost the government 4.61 per cent of GDP in the most recent fiscal year, and it issued a 15-point reform agenda centred on dismantling what it called elite capture of public resources. Two years after SIFC’s founding, that call remains unanswered. The Sapphire deal, assembled across that same period, fits the IMF’s definition with some precision.
A Market Cleared for One Entrant
When Lucky Core’s announced expansion to 760,000 tonnes completes, Pakistan’s installed soda ash capacity will stand at approximately 760,000 tonnes from LCI, 350,000 from Olympia, and 220,000 from Sapphire: roughly 1.33 million tonnes against a domestic market that 910,000 tonnes of existing capacity already served with enough left to export. The anti-dumping duties imposed in January 2026 did not protect a fragile industry from foreign predation. They removed the last 10 per cent of foreign supply from a market heading toward significant overcapacity, as a new entrant with no existing domestic production prepared to come online.
Lucky Core and Olympia filed the joint anti-dumping petition against Turkish and Kenyan imports in July 2025. The NTC imposed provisional duties of 12.54 per cent on Kenyan soda ash and 5.58 per cent on Turkish in January 2026. Turkish and Kenyan production comes from natural trona ore. It generates no calcium chloride waste, produces roughly half the CO2 of the Solvay process, and is the cheapest and most environmentally efficient soda ash available globally. Pakistan imposed a trade instrument specifically taxing the cleanest foreign supply, to protect domestic production of the dirtiest version, in a district whose water contamination has never been traced to its existing Solvay operators but whose profile is entirely consistent with their waste.
Lucky Core and Olympia carried the legal exposure of the petition. The company that benefits most from the protection it produced is Sapphire, which had no domestic output to defend when the filing was made and whose plant will enter in 2027 a market from which the cleanest foreign alternative has already been removed. Whether Sapphire’s planned entry was a factor in the petition’s timing cannot be established from the public record. The sequence is: petition filed July 2025, duties imposed January 2026, plant operational 2027.
Olympia, the existing smaller producer, received none of the state support extended to Sapphire. Its credit profile reflects the pressures a mid-sized industrial company absorbs without institutional backing. Sapphire enters the same sector with the state as minority shareholder, mineral supplier, water allocator, and market protector.
What Pakistani Law Required
The Pakistan Environmental Protection Act 1997 requires an Environmental Impact Assessment for industrial projects above defined thresholds before construction begins. A 220,000-tonne-per-year chemical plant generating 2.2 billion litres of industrial waste annually, drawing continuously from a public canal, sited in a district with a documented multi-tehsil water contamination crisis, sits above those thresholds without ambiguity. The EIA process requires public notice, community consultation, and provincial EPA approval.
Construction contracts for the Sapphire plant have already been signed. No EIA connected to this project has been published. No community consultation record exists in the public domain. No provincial EPA approval has been cited in any official communication about the project, including SIFC press releases and the PMDC MOU.
The SIFC processes approvals through apex meetings with no published records, and its decisions fall outside environmental court review. The 1997 Act requires the EIA. The SIFC process requires speed for the interests it serves. When the two conflict in the Sapphire case, the Act disappears from the paperwork.
428 Jobs
The PMDC MOU records the project’s employment contribution as 278 direct and 150 indirect positions, totaling 428 jobs in a district of approximately one million people. For a plant receiving state mineral rights, state equity capital, state water, a $100 million bank facility, anti-dumping protection, and the regulatory fast-tracking of a civil-military apex body, 428 is the minimum number the MOU needed to put a public interest case in writing. It satisfies that formal requirement and does nothing beyond it.
Sapphire has no obligation to invest in water treatment infrastructure in a district whose water fails WHO standards across four tehsils. No community health fund is attached to the project. No industrial waste monitoring programme with enforceable public reporting is a condition of the approvals. No groundwater baseline testing before construction appears in any document. The people who will live adjacent to this plant and its waste output have no legal claim on any of this, because the processes that approved the water allocation and the equity commitment do not create such claims.
The 428 figure will travel through ministerial answers, PMDC filings, and SIFC progress briefs for years. The 40,000 people who attended the Tehsil Headquarter Hospital in a single year with waterborne illness will not appear in those documents, and the question of what 25 years of Solvay industrial operations in their district contributed to the water they were drinking will remain, as it has always been, uninvestigated.
The Architecture of This Decision
The SIFC launched in June 2023 with a stated ambition of attracting $100 billion in foreign direct investment over three years, against Pakistan’s FDI baseline of $2.56 billion in 2020. No independent audit of outcomes against that figure has been published. What the Sapphire case documents is a domestic family conglomerate with revenues exceeding $500 million, 16,000 employees, nine textile mills, and offshore subsidiaries in Europe and the United States, receiving the most comprehensive package of state institutional support assembled for a single private project in recent Pakistani industrial history. The NIT already holds 4.6 per cent of the listed parent. PMDC is committing equity to the unlisted subsidiary. The state is not filling a financing gap. It is layering public resources onto a conglomerate that arrived with its own capital, in a sector that did not need a new entrant, while declining to impose the environmental accountability that Pakistani law has required since 1997 and that Khushab’s residents have had reason to demand since Olympia’s plant started running in 2000.
The IMF’s November 2025 report was precise about the structural condition that produces this outcome. Pakistan’s governance apparatus, it found, routinely directs public resources toward powerful private interests rather than citizens, through mechanisms designed to limit scrutiny. The SIFC is one such mechanism. Its closed proceedings and the PMDC’s non-binding MOU share a common function: they prevent the question of selection from being formally posed. Among every company in Pakistan that could have entered the soda ash market, one was chosen to receive publicly owned salt, publicly managed canal water, a state equity stake with no published governance terms, and a market cleared of its cleanest foreign competition. The basis on which that company was Sapphire Chemicals, and not any other, has no public record.