Pakistan Eyes International Arbitration Against Etisalat Over $800 Million Dispute

Pakistan is contemplating international arbitration against UAE-based Etisalat over an outstanding payment of $800 million related to the sale of Pakistan Telecommunication Company Limited (PTCL). The government has faced challenges in resolving this long-standing dispute, which dates back to 2005 when Etisalat acquired a 26% stake in PTCL. Despite receiving a significant portion of the payment, $800 million remains unpaid due to unresolved property transfers. The government has formed multiple committees to negotiate a resolution, but the issue persists, prompting discussions of legal action. This article delves into the complexities of the case and the potential implications for both parties involved.

By Narendra Chaudhary Nov 4, 2026, 18:03 IST

Pakistan's Potential Legal Action Against Etisalat

Islamabad: The Pakistani government is contemplating international arbitration against Etisalat, a telecommunications firm based in the UAE, regarding an unpaid sum of $800 million linked to the sale of Pakistan Telecommunication Company Limited (PTCL). This amount also includes opportunity costs dating back to 2008 and potential damages.

This issue was brought to light during a joint session of the Senate's standing committees on information technology and privatization, as reported by a local newspaper.

During the discussions, it was revealed that the Office of the Attorney General for Pakistan (OAGP) has been instructed to act on the federal cabinet's decision promptly, as per Rule 24 of the Rules of Business, 1973.

Senators expressed their astonishment at not being granted access to the sale purchase agreement (SPA) related to the divestment of 26% shares in PTCL, which included management control, to Etisalat International Pakistan (EIP).

The meeting was co-chaired by Senator Dr. Afnanullah Khan, who leads the Senate Standing Committee on Privatization, and Senator Palwasha Khan, who heads the Senate Standing Committee on Information Technology and Telecommunications.

According to a report from the Ministry of Privatization, the government sold 26% of PTCL shares, along with management control, to Etisalat in 2005 for $2.59 billion.

Out of this total, $1.76 billion has been received, leaving approximately $800 million still outstanding.

The report indicated that this payment is contingent upon the transfer of PTCL properties to the new management. While 99% of the properties have been transferred, 32 out of 3,246 properties remain untransferred.

Etisalat, now operating as e&, has withheld the remaining $800 million due to these properties not being transferred.

The ministry noted that since 2015, the government has made significant efforts to address post-privatization challenges, including forming multiple committees and negotiating with Etisalat for a resolution.

Despite these efforts, the issue remains unresolved, leading the government to establish another committee in July, chaired by the prime minister's adviser on privatization, which includes representatives from the ministries of IT and law, as well as the OAGP.

Given the lengthy history of this dispute, the committee has suggested that Pakistan pursue international arbitration as stipulated in the SPA to recover the outstanding $800 million, along with opportunity costs and applicable damages since 2008.

Additionally, it recommended that the attorney general evaluate the strength of Pakistan's case, its likelihood of success, and the legal ramifications involved.