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ISLAMABAD: The National Assembly is expected to consider the Gas Infrastructure Development Cess (Amendment) Bill, 2026, a proposed legal change aimed at resolving more than Rs400 billion in disputed and outstanding Gas Infrastructure Development Cess (GIDC) payments currently tied up in litigation. The proposed legislation seeks to amend the Gas Infrastructure Development Cess Act, 2015, and comes after years of legal disputes between the government and major gas consumers, including industrial, fertiliser and CNG sectors. The Cabinet Committee for Disposal of Legislative Cases (CCLC) approved the proposed amendments in principle earlier this year, paving the way for the government to move forward with the legislative process. The GIDC was originally introduced to generate funds for major gas infrastructure projects, including the Iran-Pakistan (IP) gas pipeline, the Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline, LNG-related projects and other associated infrastructure. However, progress on several of these projects has remained slow, while the collection and utilisation of the cess became the subject of prolonged litigation. Legal history of GIDC According to a briefing provided by the Petroleum Division to the CCLC, the original Gas Infrastructure Development Cess Act, 2011, and the GIDC Ordinance, 2014 were struck down by the Supreme Court in 2014. The government subsequently enacted the GIDC Act, 2015, in May that year. The new legislation also provided retrospective legal cover to the cess that had been charged and collected under the 2011 Act and the 2014 ordinance. Section 4(1) of the 2015 law specifies that the cess is to be utilised by the federal government for infrastructure development related to the IP pipeline, TAPI pipeline, LNG projects and other ancillary schemes. The constitutional validity of the 2015 legislation was subsequently challenged by consumers from the industrial, fertiliser and CNG sectors before different high courts. The disputes eventually reached the Supreme Court. In its judgment of August 13, 2020, the Supreme Court dismissed the civil appeals and connected petitions and upheld the constitutionality of the GIDC Act, 2015, including its retrospective application. The court, however, did not permit the government to impose a fresh cess under the disputed arrangements. Instead, it allowed recovery of outstanding arrears through instalments. Supreme Court links cess to infrastructure projects A significant aspect of the Supreme Court’s ruling was its observation that GIDC constituted a fee rather than a conventional tax. As a fee, the court noted, there must be a corresponding benefit or service associated with the amount collected. The infrastructure projects identified under Section 4 of the Act therefore formed an important basis for the continuation and utilisation of the cess. The court also observed that failure to pursue the specified gas infrastructure projects could undermine the purpose for which the cess had been imposed. Despite the Supreme Court judgment, the dispute did not come to an immediate end, as consumers continued pursuing related matters before the high courts. This resulted in a substantial amount of GIDC remaining locked in prolonged litigation. Government forms high-powered committee In an attempt to find a solution, Prime Minister Shehbaz Sharif constituted a high-powered GIDC Committee on November 8, 2022, to examine the issue of outstanding amounts exceeding Rs400 billion. The committee held several meetings following its formation, but progress remained limited because of continuing litigation in different high courts. The matter was again taken up on March 19, 2025, when the committee met under the chairmanship of the federal Minister for Finance and Revenue. The meeting was attended by the Minister for Petroleum Division, the Attorney General for Pakistan and senior officials from the Petroleum, Finance and Law divisions. During the meeting, participants agreed in principle that Section 4 of the GIDC Act, 2015 should be amended to help address the long-running legal disputes. Following the committee’s recommendations, the Petroleum Division prepared a proposal for amendments and submitted a summary seeking approval of the draft GIDC (Amendment) Act, 2025. First amendment proposal rejected The initial proposal, however, was not approved by the CCLC at its meeting on September 3, 2025. The committee directed the Petroleum Division to revisit the draft and ensure that the proposed changes remained within the original scope and objectives of the GIDC Act, 2015. The Petroleum Division subsequently revised the draft after consultations with the relevant government departments. The amended draft was sent to the Law and Justice Division for legal scrutiny, which gave its concurrence on December 15, 2025. The Petroleum Division then sought formal approval of the revised GIDC amendment bill under the relevant provisions of the Rules of Business, 1973. The Finance Division had also been consulted during the process and conveyed that it had no objection to the proposal contained in the summary submitted to the CCLC. CCLC gives approval to revised proposal The CCLC considered a Petroleum Division summary dated January 1, 2026 concerning amendments to the GIDC Act, 2015. The committee approved the proposal, subject to the incorporation of amendments recommended by the CCLC into the draft legislation by the Law and Justice Division before the bill was submitted to the federal Cabinet. The approval represents another attempt by the government to break the deadlock surrounding billions of rupees in GIDC dues and bring a degree of finality to disputes that have continued for more than a decade. TAPI project remains slow The government’s original justification for GIDC included financing major regional gas infrastructure projects. However, the implementation of these projects has remained challenging. The TAPI pipeline, envisioned to transport natural gas from Turkmenistan through Afghanistan and Pakistan to India, has faced repeated delays because of financial, security and geopolitical challenges. Although work has reportedly begun on an initial 153-kilometre section extending from Serhetabat on the Turkmenistan-Afghanistan border towards Herat in western Afghanistan, the broader project remains far from completion. The slow progress of the pipeline and other proposed infrastructure projects has also remained relevant to the broader debate over the purpose and utilisation of GIDC collections. The proposed amendment is therefore being viewed as an effort to address both the legal complications surrounding outstanding dues and the government’s

KARACHI: Selling pressure intensified at the Pakistan Stock Exchange (PSX) on Tuesday as investor sentiment weakened amid growing uncertainty over the prospects of a peace agreement between the United States and Iran and the reopening of the strategically important Strait of Hormuz. The benchmark KSE-100 Index came under pressure during the trading session, losing more than 1,300 points as investors remained cautious and reduced exposure to major stocks across several sectors. At around 2pm, the KSE-100 Index stood at 179,996.62 points, showing a decline of 1,313.66 points, or 0.72%, from the previous close. The market witnessed broad-based selling, with several major sectors contributing to the decline. Automobile assemblers, cement companies, commercial banks, fertiliser manufacturers, oil and gas exploration firms and oil marketing companies (OMCs) remained under pressure. Several index-heavy stocks also traded in negative territory. Prominent companies including HUBCO, Mari Petroleum (MARI), Oil and Gas Development Company (OGDC), Fauji Fertilizer Company (FFC), Habib Bank Limited (HBL), MCB Bank, Meezan Bank (MEBL) and United Bank Limited (UBL) were among the stocks weighing on the benchmark index. Previous session also ends lower The latest decline follows a weak close in the previous trading session. On Monday, the PSX initially moved higher but lost momentum during the second half of the session as investors opted to book profits in heavyweight shares. The KSE-100 Index eventually closed at 181,310.28 points, down 119.74 points, or 0.07%. The continued weakness suggests that investors are closely monitoring developments in international markets, particularly the situation surrounding oil supplies and the Strait of Hormuz. US-Iran tensions keep markets on edge Global financial markets remained unsettled on Tuesday as hopes for an agreement between Washington and Tehran appeared to fade. Negotiations aimed at ending the conflict and restoring normal shipping through the Strait of Hormuz have encountered fresh difficulties. US President Donald Trump on Monday responded to Iran’s conditions for a possible peace agreement by putting forward his own demands, including calls for compensation related to deaths and losses associated with wars, attacks and protests. The tougher rhetoric has raised concerns that diplomatic efforts could take longer, potentially prolonging disruptions around the crucial maritime route. The Strait of Hormuz is one of the world’s most important energy corridors, and prolonged disruption to shipping through the waterway could have significant consequences for crude oil supplies and global energy prices. Oil prices climb to highest level since July 31 The uncertainty surrounding the situation was reflected in international oil markets. Brent crude futures climbed to around $88 per barrel, while US West Texas Intermediate crude futures rose to approximately $82.45 per barrel. Both benchmarks reached their highest levels since July 31 after recording gains of roughly 5% during Monday’s trading session. Higher oil prices are a major concern for economies that depend heavily on imported energy. For Pakistan, sustained increases in global crude prices could increase the country’s import bill and place additional pressure on external accounts, inflation and domestic fuel prices. The rise in energy prices is also being closely watched by investors because higher input costs can affect corporate profitability and influence monetary policy expectations. Asian markets remain cautious The uncertainty was not limited to Pakistan. Asian equity markets moved within a narrow range as investors assessed the potential impact of rising energy prices on inflation and economic growth. MSCI’s broadest index of Asia-Pacific shares outside Japan moved between gains and losses before trading modestly higher. South Korea’s Kospi also recorded a slight increase. However, the escalation in tensions around the Gulf kept overall market sentiment fragile, with investors remaining wary of further developments that could affect energy supplies and global trade. US stock futures were also slightly positive on Tuesday. Nasdaq futures rose around 0.28%, while S&P 500 futures gained approximately 0.1%, following a weaker session on Wall Street on Monday. Inflation data in focus Investors are also awaiting the latest US consumer price data, which could provide further clues about the direction of interest rates and inflationary pressures in the world’s largest economy. The increase in crude oil prices has added another element of uncertainty ahead of the inflation report. A sustained rise in fuel and energy costs could complicate efforts to bring inflation closer to central-bank targets. For Pakistani investors, the combination of geopolitical uncertainty, higher global oil prices and pressure on heavyweight shares is likely to remain a key factor influencing trading sentiment in the near term.