Simple explanation - unlike the conspiracy theorist that abound
The lake is not always pink in colour but the distinctive colour of the water changes as a result of green alga Dunaliella salina, halobacterium Halobacteria cutirubrum, and/or high concentration of brine prawn. Once the lake water reaches a salinity level greater than that of sea water, the temperature is high enough and adequate light conditions are provided; the alga begins to accumulate the red pigment beta carotene. The pink halobacteria grow in the salt crust at the bottom of the lake and the colour of the lake is a result of the balance between, D. salina and H. cutirubrum
(From wiki)
