By Hamza Faisal
Pakistan is weighing international arbitration against Etisalat, the UAE telecom giant, to recover about $800 million still unpaid from the 2005 privatisation of Pakistan Telecommunication Company Limited (PTCL), along with the opportunity cost since 2008 and applicable damages. The long-running dispute, unresolved for two decades, moved a step closer to a legal showdown this week when it came before a joint meeting of two Senate standing committees.
The matter was taken up on Tuesday at a joint meeting of the Senate standing committees on information technology and privatisation. Senators were told that the Office of the Attorney General for Pakistan has been directed to implement the federal cabinet's decision under Rule 24 of the Rules of Business, 1973, at the earliest. The meeting was jointly chaired by Senator Dr Afnanullah Khan, chairman of the privatisation committee, and Senator Palwasha Khan, chairwoman of the information technology and telecommunications committee.
A $2.59 billion deal, $800 million still unpaid
According to a Ministry of Privatisation briefing seen by Dawn, the government sold a 26 percent stake in PTCL, along with management control, to Etisalat International Pakistan in 2005 for $2.59 billion. Of that sum, about $1.76 billion has been received, while roughly $800 million remains unpaid. The outstanding payment is linked to the transfer of PTCL properties: of the 3,246 properties covered in the latest briefing, 32 remain untransferred even though 99 percent have been handed over.
Successive governments have tried to close the file since 2015, forming several committees and negotiating with Etisalat, but the dispute remained unsettled. In July 2026, another committee was constituted under the prime minister's adviser on privatisation, with representatives from the ministries of information technology and law and the attorney general's office. Citing the dispute's 20-year history, that committee recommended that Pakistan pursue international arbitration as provided under the sale and purchase agreement to recover the $800 million, the opportunity cost since 2008 and damages.
What happens before any case is filed
No arbitration case has been filed yet, and the next steps are deliberately cautious. The committee recommended that the attorney general first assess the legal strength of Pakistan's case, its prospects of success and the potential legal consequences. If the merits permit arbitration, the attorney general should seek approval from the prime minister or the federal government before issuing a Notice of Intent to Etisalat.
The Senate session also exposed frustration among lawmakers. Senators from both committees said they had not been given access to the original sale and purchase agreement covering the PTCL divestment, and the meeting was held in camera after the IT secretary, Zarrar Hasham Khan, described the matter as sensitive. For Pakistan's telecom sector, the stakes go beyond the money: a successful recovery would close one of the country's oldest privatisation disputes, while a weak or mishandled case could entrench it for years more.
