The Pakistan Govt is facing a major legal challenge after a consortium of Saudi and Kuwaiti investors in K-Electric issued a $2 billion notice. The dispute centers on alleged violations of international investment agreements and years of delays in regulatory approvals.
According to reports, the notice was filed by Saudi Arabia’s Al Jomaih Group and Kuwait’s Denham Investments Limited, represented by the London-based law firm Steptoe International (UK) LLP. The notice, dated October 20, was sent to the Attorney General’s Office, the Prime Minister’s Office, and the Special Investment Facilitation Council (SIFC).
This marks the first-ever claim against Pakistan under the OIC Investment Agreement — a multilateral treaty protecting investments among Organization of Islamic Cooperation (OIC) member states. The investors claim that the Pakistan Govt breached its international obligations by hindering business operations, delaying key decisions, and failing to protect their investments.
The dispute mainly revolves around the stalled $1.77 billion sale of K-Electric to Shanghai Electric Power, which has remained pending since 2016. The investors say these delays caused financial harm and reduced the company’s overall value.
In their 67-page notice, the consortium accused the Pakistan Govt of “years of obstruction, inconsistency, and unfair conduct,” estimating total losses at no less than $2 billion. They have invited the government to hold talks in good faith but warned they may move to international arbitration if no agreement is reached.
The document also cites other disputes, including tariff delays, unreleased subsidies, and payment backlogs, which reportedly cost K-Electric around Rs. 100 billion annually. Additionally, the investors raised concerns over an alleged takeover attempt of K-Electric’s parent company by a Pakistani businessman, claiming regulators ignored the issue.
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The case has drawn attention from both local and international observers, as it could impact investor confidence and future foreign investment in Pakistan’s power sector.
