Islamabad: The Pakistan government is seeking an emergency payment of at least $500 million (Dh1,836 million) from Emirates Telecommunications Corporation, or etisalat, which holds a large chunk of shares in Pakistan Tele-communication Company Limited (PTCL), a newspaper reported yesterday.
Quoting an unnamed senior official at the Finance Ministry, the report said the money is needed to avoid a breach in the current year's fiscal deficit target.
In return, the government has made a firm commitment to etisalat to transfer all the company's properties to the new owners within 10 days, the official was quoted as saying.
The report said the government has already lost a tranche of $900 million from the IMF because of its failure to raise the electricity tariff by six per cent as of April 1, and the Finance Ministry is finding it difficult to meet a revised fiscal deficit target of 5.3 per cent of GDP. The government will now be increasing the power tariff by about 7.5 per cent with effect from July 1 to bridge the shortfall arising out of the delayed tariff increase.
Because of a dispute with the Pakistan government over the legal transfer of land and property titles, etisalat has been holding back payment of about $800 million of the $2.6 billion PTCL's privatisation proceeds to Pakistan for about three years.
The government sold about 26 per cent of shares along with management control of Pakistan's largest telecom operator in July 2005 when Dr Abdul Hafeez Shaikh was privatisation minister in the Musharraf government.
Shaikh, now finance minister, has taken up the matter with senior officials in Abu Dhabi to seek the immediate release of at least $500 million against a transfer of about 98 per cent of government properties within 10 days, the official told Dawn.
The official said there are a total of 3,298 properties required to be transferred to PTCL.