Pakistan Weighs Arbitration to Recover $800m From Etisalat Over PTCL Sale

Photo: Teletimes International (PTCL headquarters building, Islamabad)

Pakistan is weighing international arbitration against Etisalat to recover $800 million still unpaid from the 2005 sale of PTCL, plus the money lost since 2008 and damages. The federal cabinet has directed the attorney general's office to prepare the case, Dawn reported in its 4 November edition.

The matter came up on Tuesday at a joint meeting of the Senate standing committees on information technology and privatisation. Senators were told the Office of the Attorney General for Pakistan has been directed to put the cabinet's decision into action at the earliest under Rule 24 of the Rules of Business, 1973.

The meeting itself was a tense one. IT Secretary Zarrar Hasham Khan called the item sensitive and asked that unauthorised people, including reporters, leave the room. The rest of the session was held behind closed doors. Afterwards, some senators were annoyed that they had not even been shown the sale purchase agreement for the deal. "The strange part is that we parliamentarians cannot handle information, but it is safe with the bureaucrats," one senator said.

The deal at the centre of it all is one of Pakistan's biggest privatisations. Dawn reported, from a Ministry of Privatisation briefing, that the government sold 26 percent of PTCL, along with management control, to UAE based Etisalat International Pakistan in 2005 for $2.59 billion. Of that sum, $1.76 billion has been received. About $800 million is still unpaid.

The unpaid sum is tied to land and buildings. The payment was linked to the transfer of PTCL properties to the new management. The briefing said 99 percent of the properties have been handed over, but 32 of the total 3,246 are still untransferred. Etisalat, now known as e&, has kept holding back the $800 million because of those properties.

This is not a new row. The ministry said the government has tried since 2015 to settle it, setting up several committees and holding talks with Etisalat. When none of that worked, another committee was formed in July 2026, headed by the prime minister's adviser on privatisation, with members from the IT and law ministries and the attorney general's office. Given the 20 year history of the dispute, that committee recommended Pakistan consider international arbitration under the sale agreement, to recover the $800 million along with its opportunity cost since 2008 and damages.

There are still steps before any case is filed. The committee also recommended the attorney general assess how strong Pakistan's case is, its chances of success and the legal risks. If the merits allow arbitration, the attorney general should seek approval from the prime minister or the federal government before issuing a Notice of Intent to Etisalat. The Privatisation Division told the committees a summary has already gone to the federal cabinet.

What this means in plain terms is simple. If Pakistan wins, $800 million plus two decades of lost value would come back to the public purse at a time when every rupee counts. Households have felt that pressure all week, from petrol down to Rs369.06 and diesel to Rs391.52 from today to subsidised gas at Rs300 to 350 for BISP families under the new LPG policy, and fuel levy talks with Jamaat-e-Islami still in their final stage. But arbitration is slow and costly, and Etisalat's defence, that properties were never fully transferred, is the same argument that has stalled settlement for 20 years.

Sources

Dawn: Govt weighs options to recover $800m from Etisalat

TechJuice: Pakistan may take Etisalat to arbitration over unpaid $800 million PTCL deal

Watch for the attorney general's assessment and whether the prime minister signs off on a formal Notice of Intent to Etisalat.

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