Pakistan to Pursue International Arbitration Against Etisalat Over $800 Million PTCL Dues

Pakistan is set to initiate international arbitration against UAE-based telecom operator Etisalat to recover $800 million in unpaid dues linked to the privatization of Pakistan Telecommunication Company Limited (PTCL), along with damages and compensation for delayed payments dating back to 2008. The move marks a renewed effort to resolve a dispute that has remained unresolved for nearly two decades.

The development emerged during a joint meeting of the Senate standing committees on information technology and privatization on Tuesday. Officials informed lawmakers that the federal cabinet has directed the Office of the Attorney General for Pakistan to proceed under Rule 24 of the Rules of Business, 1973. Etisalat acquired a 26 percent stake in PTCL with management control in 2005 for $2.59 billion, but Pakistan received only $1.76 billion. The remaining $800 million was withheld due to unresolved property transfers. Although 99 percent of PTCL's 3,246 properties have been transferred, 32 remain outstanding, which Etisalat cites as the reason for withholding payment.

According to a briefing by the Privatization Division, the government has attempted to resolve the dispute through multiple committees and negotiations since 2015 without success. In July 2026, another committee was formed under the prime minister's adviser on privatization, with representatives from the IT and law ministries and the attorney general's office. The committee recommended pursuing international arbitration under the share purchase agreement to recover the outstanding amount, its opportunity cost since 2008, and applicable damages. It also asked the attorney general to assess the strength of Pakistan's legal position and the potential consequences before any formal action.

The committee further recommended obtaining approval from the prime minister or federal government before issuing a Notice of Intent to Etisalat, provided the attorney general considers arbitration legally viable. The Privatization Division subsequently submitted a summary to the federal cabinet.

The joint meeting, chaired by Senator Dr. Afnanullah Khan and Senator Palwasha Khan, also revealed concerns among lawmakers over their inability to access the original PTCL share purchase agreement. IT Secretary Zarrar Hasham Khan described the matter as sensitive and requested that unauthorized participants, including journalists, leave before discussions continued behind closed doors. Several senators later questioned why parliamentarians had not been given access to the agreement governing the transfer of national assets, while government officials retained access to its details. They called for greater parliamentary oversight of privatization transactions.

The attorney general's office has been tasked with implementing the cabinet's decision as the government considers its next steps in recovering the unpaid $800 million from Etisalat.