Investor enthusiasm for Pakistan's planned sale of three power distribution companies could quickly fade unless the government delivers on a suite of regulatory and financial assurances. A feedback report compiled for the Privatisation Commission after roadshows in Pakistan, Turkiye, Saudi Arabia, and China reveals that potential buyers are pressing for longer tariff commitments, protection against regulatory reversals, and greater operational freedom—conditions that could make or break the deal. Main Developments At the heart of investor demands is an extension of the multi-year tariff (MYT) regime. They want the control period stretched from five years to seven to ten years, arguing that the current framework is too short to justify investments in long-lived distribution assets. Investors also seek to replace the uniform tariff system with one tied to each Disco's performance and efficiency. They contend that the existing arrangement penalises better-performing companies and have asked for incentives to cut transmission and distribution losses while improving service reliability. Read also: Petrol up Rs4.45, diesel down Rs2: 5 key facts on new fuel prices Regulatory predictability is another sticking point. International buyers fear that tariffs and contracts agreed at privatisation could later be reopened by a government or court, so they want contractual safeguards and key investment plans, capital expenditure requirements, and tariff details settled before bidding. Ownership rules are also under scrutiny. Most investors favour full ownership of the Discos, while several want permission to acquire stakes in more than one company, subject to safeguards against excessive concentration. Some have suggested retaining a minority government stake in Islamabad Electric Supply Company due to its large base of government consumers. Background The privatisation of Faisalabad Electric Supply Company (Fesco), Gujranwala Electric Power Company (Gepco), and Islamabad Electric Supply Company (Iesco) is part of Pakistan's broader efforts to reform its ailing power sector. The government has been grappling with circular debt, inefficient distribution networks, and mounting losses, making the sale of these entities a key pillar of its economic recovery strategy. In June and July, roadshows were held in Pakistan, Turkiye, Saudi Arabia, and China to gauge investor appetite. The feedback report, prepared for the Privatisation Commission, reflects the concerns raised by potential buyers during these sessions, highlighting the gap between initial interest and the conditions needed to finalise bids. Why It Matters The outcome of this privatisation could set a precedent for Pakistan's broader energy sector reforms. If investors walk away, the government may struggle to attract capital for other infrastructure projects, while continued inefficiencies in power distribution could keep tariffs high and supply unreliable for millions of consumers. Investors see additional revenue opportunities in Disco assets, including telecom infrastructure, EV charging, and smart metering, but they want clear rules governing these businesses and revenue sharing. Delayed government subsidies, particularly those owed for Azad Jammu and Kashmir, have been flagged as a serious cash-flow risk, with investors demanding an automated settlement mechanism, compensation for delays, and a defined dispute-resolution process. What's Next The Privatisation Commission must now decide whether to incorporate these demands into the bidding terms. Investors have also raised concerns about exchange-rate risks on overseas borrowing for capital expenditure and dividend repatriation, which could further complicate negotiations. Turning interest into competitive bids will depend on the government's ability to provide a credible and predictable framework before the process moves to the bidding stage. The clock is ticking, and the next few months will reveal whether the government can meet investor expectations or risk losing momentum on this critical privatisation drive.