Karkey fine.

IT is a welcome development that the government has succeeded in negotiating a waiver of the fine imposed on the country in the dispute with Karkey Karadeniz, the Turkish company that had set up a rental power plant in Pakistan and that became the subject of intense judicial intervention. The amount that was awarded to Karkey by the International Centre for the Settlement of Investment Disputes was $1.2bn, a substantial sum for a country that is on an IMF programme. Having the disputed amount settled through the government's intervention has surely helped the country.

What is worth considering here, however, is how much it took to extricate the government from the mess that was created by that judicial intervention in a set of commercial agreements. The governments of Pakistan and Turkey had to take up the matter at the highest levels - such accommodations do not usually come without some sort of quid pro quo. So if Pakistan has saved itself from being obligated to pay a fine of $1.2bn, it is hopefully because of a goodwill gesture on the part of Turkey...