Air Link, Hisense Partner For Local Appliances Manufacturing
January 22, 2026
Saudi and Kuwaiti investors in K-Electric have moved an international arbitration case worth $2 billion against Pakistan, claiming regulatory interference, unpaid bills, and the failure of a delayed sale agreement.
Read more: Prince Mansour Acquires Majority K-Electric Stake
Saudi and Kuwaiti investors, who own a substantial stake in K-Electric, have filed an international arbitration case worth $2 billion against the Pakistani government. The case has been filed on January 16, 2026, and includes allegations of regulatory interference, unpaid government receivables, and the blocking of the planned sale of K-Electric.
The investors, who have been associated with K-Electric since the company’s privatization in 2005, state that the change in the regulatory policy in Pakistan led to the collapse of a $1.77 billion deal for the sale of a majority stake in the company to Shanghai Electric. Although the deal received initial approvals, it got stuck for more than eight years before finally falling through due to delayed security approvals and conflicting directions from regulatory agencies.
They have also pointed out the existence of billions of unpaid tariff differential subsidies, some of which have been outstanding for almost two decades, which they claim affected the cash flows of the utility company. Other allegations include government intervention in the tariff setting decisions of NEPRA – National Electric Power Regulatory Authority, new tariffs that are financially detrimental, and failure to act on disputed offshore transactions. The case also raises several questions regarding the investment environment in Pakistan.
