Pakistan turned down an offer from Etisalat for the settlement of the PTCL privatisation dispute with payment of $263 million, which amounts to approximately one-third of the total outstanding dues. Official Pakistani sources now say that United Arab Emirates’ (UAE) telecommunication company will double the settlement amount.
The offer of $263 million made by Etisalat was even lower than the amount it was willing to pay six years ago. A delegation of Etisalat met Finance Minister Ishaq Dar recently, for the second time in two months, to find a solution to the 17-year-old privatisation dispute.
The company owes $800 million in privatisation proceeds of Pakistan Telecommunication Company Limited (PTCL), but no Pakistani government has taken Etisalat to the international court of arbitration yet.
“Both sides agreed to proceed with the resolution of all outstanding issues between Etisalat and the Privatisation Commission in a spirit of goodwill,” said the Ministry of Finance. But it did not share terms of the offer.
The UAE firm has withheld money due to Pakistan’s inability to transfer 33 remaining properties in PTCL’s name, which the government had committed to do in 2005. However, Pakistan has already transferred over 3,000 properties, in spite of which Etisalat did not pay any money out of the remaining $800 million.
An independent study conducted recently by two economists found that PTCL’s deal was in violation of Pakistani legal regulations, as the company’s management was surrendered for just 26% of its shares.
