Pakistan to Let Go of $800 Million Outstanding Amount from Etisalat

Pakistan will not go into arbitration against the Dubai-based Etisalat for not releasing $800 million outstanding on account of the purchase of 26% shares of Pakistan Telecommunication Company Limited (PTCL), as it would have negative consequences on bilateral relations between the two countries.

This was stated by Chairman, Privatization Commission (PC) Muhammad Zubair while briefing the Senate Standing committee on Information Technology and Telecommunication which met with Shahi Syed in the chair on Wednesday.

The committee recommended Prime Minister Nawaz Sharif to personally intervene at highest level with Dubai rulers for the early release of outstanding $800 million by Etisalat.

The committee also decided to invite Etisalat in next committee meeting to hear Etisalat’s side of story to reach a logical conclusion.

Zubair said that a meeting of Secretary Finance and Privatization was held with Etisalat last week (Sunday), however, the assessment was that there are little chances that the $800 million will be released keeping in view the prevailing situation of PTCL profitability and share price.

The Government of Pakistan failed in fulfilling its obligation in the agreement — by not transferring cent percent properties — and cannot go into the arbitration as it would have negative consequences on the bilateral relations between the two countries, said Zubair.

There are little chances that the $800 million will be released keeping in view the prevailing situation of PTCL profitability and share price

The committee was informed that a large number of properties were not under PTCL control as they were either rented or were in disputes, however, the then Government of Pakistan gave a commitment to the buyers that over 500 properties would be transferred to them.

As per the Share Purchase Agreement, the payment of the balance $1.2 billion was contingent upon transfer of clean and clear titles of 100% properties by January 2008.

In case of failure, valuations of the properties not transferred till January 2008 will be carried out by both the Seller and the Purchaser separately and higher of the two valuations will be considered for deduction from the balance installments.

At the time of privatization of PTCL, there were a total of 3248 properties to be mutated in favor of PTCL. Of these, 3,215 have already been transferred till date leaving behind 33 outstanding properties and Etisalat has been informed that these are non-transferable.

Zubair said it is an international agreement and the government had to meet all these requirements.

Privatization Commission has had the properties assessed by three valuers at different times. Hamid Mukhtar & Co was first engaged in 2009. Subsequently, National Bank of Pakistan was tasked in 2011 and lastly by M/s Iqbal Nanjee & Co in 2013. At present, the valuation of 33 non-transferable properties is around $87.89 million.

The committee was further informed that independent investigations on the privatization of PTCL have been completed in the past by both National Assembly Standing Committee on IT and National Accountability Bureau (NAB). It was informed that these investigation reports were recently submitted to the Public Accounts Committee (PAC), where satisfaction has been expressed.

Senator Shibli Faraz said the government should not only recover the money but also hold responsible the ones who acted against national interests.

Senator Osman Saifullah Khan said that Etisalat may be asked to appoint their valuers and carry the remaining property valuation. Senator Rehman Malik said that Etisalat was of the view that they have been deceived and properties which were not under PTCL’s control or were on rent were also shown as its own properties resulting in high bid price.

Chairman committee said that PM should personally intervene to resolve the outstanding issue. The committee further recommended PC to devise ToRs to avoid negligence and wrong doings in future.


      • Technically Shaukat Aziz and the rest of the people who privatised PTCL should be taken to task for the mess they left behind.

        It is so sad, I read so many stories from technical people how PTCL sale was not about providing best Telecom service with SLA and penalties, but 100% about PROPERTIES. And over the years they have been proven right, PTCL service is better but not as good as it could be, far from it.

    • No, thank you Musharraf,who sold the said 26% to them. As well as Ufone 100%

      He should have chased them after they did not pay it on time.

      What could the other governments do afterwards when they Etisalat where entrenched into PTCL, close PTCL?No as then the awaam would cry as they could not phone people who only had a PTCL connection and no mobile connection.

      • Previous governments could have done it earlier but they didn’t. Nawaz government kneeled before their masters.
        In the end, another loss to Pakistan, its people and economy.

    • Also not everything is PML-N evil doing.

      Others (PPP, MQM, JUI, PML-Q, ANP etc) have done worse and where was everyone and their sister?Not in front of any containers thats for sure.

      From the beginning of Pakistan every Government, every Military leader has done good and bad things.

      WE need to take all facts into consideration before coming to the truth.

    • There’s a lot of property of Politicians in Dubai etc so can’t ruin personal relations for 800 million and that’s how it works even with India until recently otherwise they want to have trade relations with our enemy because it’s beneficial for the business!

  • This shows that even Govt. of Pakistan has lost control to Property Mafia. If they can’t get properties clear in 10 years, what about the common man?

  • Such deals are made over a few drinks. Well done Musharraf. Thanks for keeping the interest of Pakistan supreme in everything.

    • It was Bilal Musharaf who was advising Etisalat sheikhs on proper price of PTCL stakes. Etisalat won the bid but paid more than 1$ billion higher than second highest bidder. So, now like sore losers, they are blackmailing us and witholding our payments. Government should declare them absconder and take over PTCL.

  • What the hellI just red.
    Why Pakistan let go $800 Million, are we now the world richest country or what?
    Our Government is insane, get ready for New Taxes on PTCL Bills Which we must have to pay.
    #ThankYouNawazSharif

  • This is nuclear Pakistan who does not able to receive money from a foreign company. USA congress has set aside the Vito of Obama and give right to victims of 9/11 to sue Saudi Arabia.

  • this is what happens when a country is weak from within even if you have biggest army and atom bomb…..no one gives a shit …..not even a company

  • “Pakistan to Let Go of $800 Million Outstanding Amount from Etisalat” – Nothing in your article says so.

    Shitty-reporting!

    • Don’t worry, governments of Pakistan will find a way to make your great great great grandchildren even sadder!

  • Due to these stupid deals, we got per minute calling. before that 5 min call was default. Plus the broadband tariff increased from Rs. 800 to 1300+ (1Mbps) and 2Mbps now 1575.

    The core reason being ARPUs. Pakistan has a price sensitive market and Etisalat in ME/KSA region has ARPUs around $50. Whereas in Pak, the ARPUs has dropped considerably.

    • You are wrong about bandwidth. I remember in 2006 the best deal I could get was 1 GB of traffic limit at 256 KBit/sec at home. Not becuase I lived in far off place but because prices for bandwidth were SO HIGH.

  • 1. Ptcl private main zameen kyo de jarahe h?
    2. Ptcl pensioner ke haq main fasla hone ke bad be paise ni mel rahe. Jab 800 mele tu un ko be mele.

  • Government takes Etisalat under its wings

    ISLAMABAD: The government has barred the National Accountability Bureau (NAB) from investigating the PTCL privatisation deal and non-payment of $800 million by Etisalat, Daily Times has learnt.

    Sources disclosed that Prime Minister Nawaz Sharif and Finance Minister Ishaq Dar sent a clear message to the NAB chairman not to probe against Etisalat.

    They said the government would talk to the UAE government regarding non-payment of $800 million, adding that there is a chance that Pakistan-UAE relations would be affected if NAB takes any action.

    NAB has stopped proceedings and investigation against the officials and former government personalities who approved the privatisation of PTCL to Etisalat.

    NAB sources said that in an internal investigation it has been proved that the privatisation agreement was vague and one-sided and action must be taken against those responsible for handing over the PTCL to Etisalat. The handing over of all PTCL properties to Etisalat was not part of the deal, they added.

    Sources said the Public Accounts Committee (PAC) took notice of the non-payment of $800 million to Pakistan.

    They said later PAC ordered NAB to investigate the deal agreement and non- payment of $800 million, adding that but NAB has refused to take up the matter. They said further both Pakistan and UAE agreed to resolve the matter through backdoor channels and Dar had met Etisalat officials in this regard. PAC too has not taken up the matter in the recent meetings.

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