ISLAMABAD              -               The government on Thursday has decided to finalize the plan within one month to settle a decade-old dispute with the UAE-based Etisalat for recovering due amount of $800 million against the privatisation of Pakistan Telecommunication Company Limited (PTCL).

“We want to move beyond the status quo maintained on the issue for over a decade and bring the matter to a final settlement beneficial for our country and our long-term business interests,” said Adviser to the Prime Minister on Finance and Revenue Dr. Abdul Hafeez Shaikh.  He directed the concerned ministries to come up with the final proposal for the resolution of the pending payments before the end of this month.

Shaikh made these remarks while chairing the Inter-Ministerial meeting regarding the issue of pending payments by Etisalat. Minister for IT Khalid Maqbool Siddiqui was also present in the meeting. In the presence of all the stakeholders including Secretary IT, Secretary Privatization Commission and Secretary Finance, pending matters regarding the final settlement were discussed in detail.

An official informed that Pakistan may offer Etisalat to deduct about Rs9 billion ($60 million) from its $800m outstanding sale proceeds of the PTCL. Etisalat has held back $800m in PTCL sale proceeds for well over 13 years now, although it won 26 percent shareholding along with management control of the then telecom monopoly for $2.6 billion in June 2005. Pakistan had to recover $800 million from UAE-based telecom since 2005 but three successive governments had failed to resolve the issue. In July 2005, Etisalat had bought 26% shares in PTCL with management control at a price of $2.6 billion. After coming to know the second lowest bid was actually $1.4 billion, the UAE-based firm tried to backtrack from the offer. In March 2006, the then government signed an agreement with Etisalat under which 3,384 properties of the PTCL had to be handed over to the company. Etisalat had paid $1.4 billion upfront payment against privatisation of PTCL in 2005-06. However, it had stopped the remaining installments amounting to $800m until the status of PTCL’s owned properties was cleared, which has remained a bone of contention for the last 12 years.

The government had so far transferred 3,248 properties in favour of Etisalat while 34 could not be transferred. Pakistan had informed the company that it cannot transfer the remaining 34 properties and that it would have to pay the outstanding dues by adjusting the value of these properties. According to Pakistan’s assessment the value of these properties was not more than $88 million. However, the Etisalat had not accepted the Pakistan’s offer in past.