Pakistan expects Etisalat to soon settle the $799 million it owes from a 2006 investment in the country’s former telecom monopoly -Finance Minister
Etisalat to Resolve $799 Million Dispute Soon
Etisalat, the United Arab Emirates’ largest telecom operator by revenue and subscribers, led a consortium that bought a 26 % stake in Pakistan Telecommunication Co (PTCL) for $2.6 billion. But Etisalat, which also obtained majority voting rights in PTCL, withheld $799 million it owes on the deal because of Pakistan’s failure to reassign ownership of 3,248 properties to PTCL as per the sale agreement.
Pakistan’s Finance Minister, Ishaq Dar, said:
The release of funds is expected shortly – PTCL is still due 31 properties, but these are unlikely to ever be transferred due to various reasons including legal impediments
This leaves Etisalat with two options
- To surrender PTCL’s right to these properties and reduce the amount the UAE operator owes Pakistan by their combined agreed value, OR
- Withhold the same amount until it receives titles to these properties.
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Dar ruled out taking punitive action against Etisalat to try to force the company to pay, while Etisalat did not respond to repeated requests for comment regarding Pakistan.
Receiving the bulk of the money Etisalat owes would boost Pakistan government coffers. The International Monetary Fund (IMF) saved Pakistan from possible default by agreeing last September to lend it $6.7 billion over three years.