ISLAMABAD – The federal government is exploring legal options, including international arbitration, to recover approximately $800 million withheld by UAE-based telecommunications company Etisalat from the 2005 privatisation of Pakistan Telecommunication Company Limited (PTCL).
The government is also considering seeking compensation for the financial losses incurred due to the delayed payment, including its opportunity cost since 2008 and other applicable damages.
The issue came under discussion during a joint meeting of the Senate Standing Committees on Information Technology and Telecommunications and Privatisation, the latest reports suggested.
Officials informed lawmakers that the Office of the Attorney General for Pakistan (OAGP) had been instructed to act on the federal cabinet’s decision under Rule 24 of the Rules of Business, 1973, without further delay.
The meeting was jointly chaired by Senator Dr Afnanullah Khan, chairman of the Privatisation Committee, and Senator Palwasha Khan, chairperson of the IT and Telecommunications Committee.
During the proceedings, IT Secretary Zarrar Hasham Khan described the matter as sensitive and requested that unauthorised individuals, including journalists, leave the room. The discussion subsequently continued behind closed doors.
However, several senators later voiced reservations over the failure to share the Sale and Purchase Agreement (SPA) with parliamentarians. The agreement covers the transfer of 26 per cent of PTCL shares, along with management control, to Etisalat International Pakistan (EIP).
Some lawmakers questioned why elected representatives had been denied access to details of a transaction involving a major national asset, while government officials retained access to the documents. They called for a legal framework ensuring parliamentary oversight of such privatisation deals.
According to the Privatisation Division’s briefing, Pakistan transferred a 26 per cent stake in PTCL, together with management control, to Etisalat in 2005 for $2.59 billion. The government received around $1.76 billion, while nearly $800 million remains outstanding.
The unpaid amount is linked to the transfer of PTCL-owned properties. Although 99 per cent of the properties were handed over, 32 out of 3,246 properties remained pending, prompting Etisalat, now operating under the name e&, to retain the remaining payment.
Pakistan has pursued negotiations and established several committees since 2015 in an effort to settle the disagreement without litigation. However, repeated attempts to reach an understanding have failed to produce a resolution.
In July 2026, the government formed another committee under the leadership of the prime minister’s adviser on privatisation. Representatives from the ministries of information technology and law, along with the Attorney General’s Office, were included in the panel.
After reviewing the dispute’s nearly two-decade history, the committee proposed invoking the international arbitration mechanism available under the original agreement to pursue the outstanding amount, financial losses arising from the delay and applicable damages.
It also advised the Attorney General to examine the legal merits of Pakistan’s position, assess the likelihood of a favourable outcome and identify potential legal consequences.
The committee further recommended that, if arbitration was considered legally viable, approval from the prime minister or the federal government should be obtained before sending Etisalat a formal Notice of Intent.
The Privatisation Division subsequently submitted a summary outlining the proposed course of action to the federal cabinet.
