FDI taking constant hits as Qatari group signals divestment of Port Qasim plant stake

ISLAMABAD: Pakistan continues to struggle with a severe decline in Foreign Direct Investment (FDI) due to a host of economic and policy challenges. At the same time, several multinational companies are either selling their stakes or exiting the market altogether.

Now, the Al-Thani Group of Qatar has also joined the list, signaling its intent to divest its 49 percent shareholding in the 1,320 MW Port Qasim coal-fired power plant, well-informed sources in the federal government told Business Recorder.

The 1,320 MW Port Qasim Power Project comprises two 660 MW supercritical coal power units established under the China–Pakistan Economic Corridor (CPEC). The USD 2.09 billion project, spread over 330.7 acres at Port Qasim—about 37 kilometers east of Karachi—was jointly developed by Qatar’s Al-Mirqab Capital and China’s Power Construction Corporation, a subsidiary of Sinohydro Resources Limited. Al-Thani Group invested over USD 1 billion in the venture.

1,320 MW coal plant: PQEPC threatens to halt operations

Like other independent power producers (IPPs), the Port Qasim plant’s management has long expressed frustration with the Central Power Purchasing Agency– Guaranteed (CPPA-G) over chronic delays in clearing outstanding dues. These financial challenges remain unresolved, reportedly due to Pakistan’s ongoing foreign exchange constraints. Chinese CPEC IPPs continue to press for payment of their remaining receivables, which are estimated at around Rs 400 billion.

In a recent communication, the management of the Port Qasim Electric Power Company (PQEPC) warned the government of a potential suspension of operations due to CPPA-G’s failure to meet financial obligations under the Power Purchase Agreement (PPA).

“A project suspension would be a lose-lose situation that all parties must work to avoid. Timely settlement of the dues is critical to ensuring sustainable power generation and preventing defaults under loan agreements and Pakistan’s sovereign guarantees,” sources quoted Mr. Dongfeng as warning top government officials. He urged authorities to provide immediate financial support to CPPA-G so that the mounting arrears could be cleared.

Last year, Prime Minister Shehbaz Sharif reportedly received a letter from former Qatari Prime Minister Sheikh Hamad Bin Jassim Bin Jaber Al Thani, requesting payment of USD 450 million owed to PQEPC for its investment in the Port Qasim project. Despite the involvement of the Prime Minister’s Special Assistant on Foreign Affairs, Tariq Fatemi, the dues remain unpaid.

In the latest development, Al-Mirqab Capital has formally communicated its intent to divest from the Port Qasim Power Project. The Qatari firm has conveyed this decision to senior officials in Islamabad, including Federal Minister for Power Sardar Awais Ahmad Khan Leghari and Minister for Economic Affairs Senator Ahad Khan Cheema.

Al-Mirqab Capital — the family office of Sheikh Hamad Bin Jassim Bin Jaber Al Thani — is headquartered in Doha and manages the Al-Thani family’s global investment portfolio across public equities, real estate, and private assets.

According to official sources, the “Notice of Intent to Divest from the Port Qasim Power Plant” has been shared through formal channels. “In compliance with the instructions, M/s Al-Mirqab Capital was contacted using the information provided in the letter. However, they advised that any coordination regarding the proposed meeting should be routed through the same official channel by which the original correspondence was conveyed,” the sources added.

Meanwhile, Pakistan’s investment climate continues to deteriorate. Over the past four years, nine multinational companies have exited or divested from the country. Four of these were manufacturers — three pharmaceutical firms (Pfizer, Sanofi-Aventis, and Eli Lilly) and one consumer goods company (Procter & Gamble). The remaining firms belonged to the services sector, including Shell, Total, Telenor, and Uber/Careem. However, when contacted, Minister for Power, Sardar Awais Khan Leghari said, “I have no such news.”

Minister for Economic Affairs Ahad Khan Cheema and PPIB Managing Director Shah Jahan Mirza did not respond to Business Recorder queries.

Copyright Business Recorder, 2025