Pakistan Moves Toward International Arbitration Against Etisalat Over $800m PTCL Dues

Pakistan is moving closer to taking UAE telecom group Etisalat to international arbitration over the Etisalat PTCL dues of about $800 million, which have remained unpaid for nearly two decades since the 2005 privatisation of Pakistan Telecommunication Company Limited (PTCL).

Senators were told at a joint meeting of the Senate standing committees on information technology and privatisation on Tuesday that the Office of the Attorney General for Pakistan has been directed to implement the federal cabinet’s decision on the matter under Rule 24 of the Rules of Business, 1973, at the earliest.

Etisalat PTCL Dues: How the $800 Million Gap Arose

According to a briefing by the Ministry of Privatisation, the government sold a 26 percent stake in PTCL along with management control to Etisalat in 2005 for $2.59 billion. Of this, $1.76 billion was received, while roughly $800 million is still outstanding.

The remaining payment was tied to the transfer of PTCL properties to the new management. The ministry said 99 percent of the properties have been transferred, but 32 out of 3,246 are still pending. Etisalat, now known as e&, has continued to withhold the balance on the grounds that these transfers are incomplete.

What the Government Committee Recommended

The ministry said Pakistan has tried to settle the post-privatisation issues since 2015 through several committees and talks with Etisalat, without success. In July 2026 the government formed a new committee headed by the Prime Minister’s adviser on privatisation, with representatives of the IT and law ministries and the attorney general’s office.

Citing the 20-year history of the dispute, the committee recommended that Pakistan use the international arbitration option provided in the sale purchase agreement to recover the $800 million, along with the opportunity cost since 2008 and applicable damages. It also asked the attorney general to assess how strong Pakistan’s case is and its chances of success. Before any Notice of Intent is issued to Etisalat, the attorney general is to seek approval from the Prime Minister or the federal government, according to the briefing.

Senators Object to Secrecy Over Sale Agreement

The meeting was jointly chaired by Senator Dr Afnanullah Khan and Senator Palwasha Khan. At the request of IT Secretary Zarrar Hasham Khan, who described the agenda item as sensitive, media representatives were asked to leave and the proceedings were held in camera. Several senators later complained that they had not been given access to the sale purchase agreement for PTCL, and one called for a law requiring Parliament to be informed about the sale of national assets.

Background: Earlier Attempts to Settle Etisalat PTCL Dues

This is not the first time arbitration has been discussed. In 2018, officials publicly said Pakistan was considering the London Court of International Arbitration. In December 2022, Pakistan turned down an Etisalat settlement offer of $263 million, roughly one-third of the outstanding amount, and asked for a higher figure. Until now, no Pakistani government has formally started arbitration proceedings.

What Happens Next

The next steps are the attorney general’s legal assessment and a final approval from the Prime Minister or cabinet. If arbitration goes ahead, Pakistan would seek not only the $800 million but also compensation for the delay. Because the UAE is one of Pakistan’s closest economic partners, any formal case would also carry diplomatic weight. For PTCL and Ufone customers, day-to-day services are not affected by the dispute, which concerns payments between the government and the buyer of the stake.

The Etisalat PTCL dues case remains one of the longest-running privatisation disputes in Pakistan, and its outcome could shape how future sales of state assets are structured and disclosed to Parliament.

For official updates, visit the Senate of Pakistan website.

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