The United Arab Emirates has reportedly lost interest in and shelved Pakistan’s plans to outsource the management and operations of Islamabad International Airport to the Gulf country.
The cancellation of the deal, which has been under discussion since August 2025 – came after a two-hour visit to India by UAE President Sheikh Nahyan, according to a Hindustan Times report.
Now, with no progress on outsourcing, the Pakistan government has decided to put Islamabad International Airport on the active privatization list. The move comes after the successful privatization of Pakistan International Airlines (PIA), The Express Tribune reported.
Sources told The Express Tribune that the UAE’s failure to name a nominated entity ultimately signaled its lack of interest, prompting Islamabad to change course.
“UAE not interested”
A Pakistani media report said officials were seeking a definitive response from the UAE on the deal by issuing a final call. However, the Arab nation reportedly responded by saying it was still unable to name a nominated entity and said it was no longer interested in continuing the process.
She further stated that the UAE was not interested in continuing the process. As a result, the government approved a proposal to include Islamabad International Airport in the list of active privatizations after the highly successful privatization of Pakistan International Airlines.
The Pakistani media report did not link the collapse of the deal to any political motives. However, the postponement of the deal comes at a time of growing friction in the Persian Gulf, particularly between the UAE and Saudi Arabia. Once close allies, Riyadh and Abu Dhabi are now reportedly engaged in an unusually public dispute over their support for rival factions in Yemen.
Pakistan-Saudi relations
Amid a growing rift between the UAE and Saudi Arabia, Islamabad has deepened its ties with Saudi Arabia – signing a defense deal and pushing for what it describes as an “Islamic NATO” with Saudi Arabia and Turkey.
Meanwhile, the UAE has signed new agreements with India.
UAE ties with Pakistan
The shift means a sharp contrast to the past. For decades, the UAE has been among Pakistan’s largest trading partners and a major source of remittances, employing thousands of Pakistanis in various sectors.
The two nations have also worked closely together on defense, energy and investment projects. Over the years, however, the relationship has been strained by security concerns, licensing disputes and Pakistan’s aging infrastructure.
