The appointment of Muhammad Arshad Khan Ustrana to the Board of Directors of the Khyber Pakhtunkhwa Economic Zones Development and Management Company (KPEZDMC) has raised serious questions about the province’s due diligence and fit-and-proper process, particularly in view of an earlier National Accountability Bureau (NAB) inquiry into irregularities during his tenure as chairman of the Board of Governors of Medical Teaching Institution (MTI), Dera Ismail Khan.
The issue has acquired fresh significance because Mr Ustrana is now not merely a member of a provincial public-sector company’s board but has been entrusted with committee responsibilities touching precisely the areas- human resources, legal affairs and procurement - that figured prominently in the earlier controversy.
The Institute of Business Administration’s State-Owned Enterprises programme currently lists Mr Ustrana as a 2026 board member of KPEZDMC, and the Certification, also sponsored by the Government of KP, through its company.
The central question, therefore, is not whether Mr Ustrana was ever convicted by a court. It is whether the authorities responsible for his nomination and appointment examined his full record of public-sector governance, including the findings later recorded by NAB, before assigning him oversight responsibilities in another government-controlled entity, or whether he is another blue-eyed member of the political elite.
Mr Ustrana previously headed the Board of Governors of MTI D.I. Khan. In June 2021, he had been removed from the position amid allegations concerning appointments and the floating of tenders for medicines and equipment. NAB had taken notice of the matter and obtained official records.
The controversy did not end with his removal. Mr Ustrana continued occupying the chairman’s office after the government decision, prompting the Health Department to subsequently direct him to vacate it. More importantly, a NAB Khyber Pakhtunkhwa communication dated June 20, 2024, addressed to the Chief Secretary and the Health Department dealt with an inquiry concerning alleged misuse of authority and illegal appointments at MTI D.I. Khan.
The NAB findings recorded serious procedural irregularities.
Among other things, the inquiry found that appointments to senior positions—including Hospital Director, Finance Director, and Additional Hospital Director—were approved through Board meetings that, according to NAB’s findings, lacked the required quorum, resulting in gross governance and SECP violations. Mr Ustrana continued to serve his own interests through BoG and its committees, despite their official incompleteness due to a lack of quorum. The NAB inquiry also questioned the constitution of the recruitment committee used for appointments, finding it inconsistent with the amended MTI legal framework. The findings extended beyond a handful of senior appointments.
More than 200 employees were recruited through the disputed process, including trainee registrars, medical officers, computer operators, junior clerks, storekeepers and paramedical staff. The inquiry also recorded the appointment of 53 Class-IV employees at Gomal Medical College beyond sanctioned posts and another 20 Class-IV employees without advertisement or employment-exchange data. NAB also recorded irregularities in promotions and appointments approved through Board meetings that lacked the required quorum.
The NAB inquiry was ultimately closed at the bureau level, with the matter referred to the provincial Health Department and Anti-corruption for corrective departmental action. The referral sought a compliance report within two months and did not itself constitute a judicial finding of criminal guilt against Mr Ustrana.
No readily available public record establishes what action the Health Department ultimately took on NAB’s June 2024 referral, whether the department completed the requested corrective proceedings, whether any appointments were reviewed, or whether Mr Ustrana was subsequently formally cleared.
This missing link matters because he later returned to another public-sector governance position.
If corrective or disciplinary action was taken, that should be disclosed. If the department disagreed with any of NAB’s findings, the reasons and competent authority’s decision should be available for public scrutiny.
Instead, the subsequent appointment raises the obvious question:
This matter deserves examination against the corporate-governance framework governing public-sector companies, by SECP.
SECP’s public-sector corporate-governance framework requires appointing authorities to apply fit-and-proper criteria when nominating board members. The framework expressly addresses matters including financial integrity, competence and the overall suitability of a proposed director. SECP’s governance-compliance guidelines also require companies to report whether appointing authorities applied the prescribed fit-and-proper criteria when making board nominations. The criteria are therefore broader than the simple question of whether a court has convicted an individual.
Indeed, the public-sector governance framework identifies integrity and propriety as elements of sound governance, while the applicable fit-and-proper framework provides for consideration of a candidate’s record and circumstances rather than treating criminal conviction as the sole test.
That makes the unanswered due-diligence question particularly relevant in Mr Ustrana’s case.
Another issue merits scrutiny.
The concerns recorded in the NAB inquiry largely involved recruitment, appointments, Board procedure and procurement. Yet Mr Ustrana has subsequently been given committee responsibilities in KPEZDMC involving human resources, legal affairs and procurement.
So far, not much has surfaced publicly to establish that anything improper is taking place at this provincial company. But the absence of publicly visible evidence should not necessarily be read as evidence that nothing is happening behind the scenes. Once again, the cover of a board position and powerful committees appears to provide the setting for decisions that warrant closer scrutiny. Whether plans are already being quietly shaped, and whether they have the backing of a small but influential circle in bureaucracy, is precisely the question that requires answers.
The juxtaposition of the earlier record with Mr Ustrana’s present responsibilities does not automatically mean that an individual is permanently barred from holding public office. What it does establish is a legitimate reason to ask whether the lessons of the past have genuinely been addressed - or whether the same governance vulnerabilities are once again being allowed to take root under the protection of boardroom authority and committee structures.
But it does create a legitimate governance question about the logic of assigning such responsibilities by the provincial government, without first making the underlying record and any subsequent departmental decision transparent. The issue is not merely who appointed. The controversy's political dimension is more interesting.
Questions have been raised about whether Mr Ustrana previously benefited from political connections, including alleged proximity to former Chief Minister Ali Amin Gandapur, and whether such connections influenced the handling of the earlier MTI controversy. This is not the first time Mr Ustrana’s return to a position of influence has raised eyebrows. In June 2024, after he was removed as chairman of the Board of Governors of MTI D.I. Khan and the board itself was dissolved, then Federal Minister Ali Amin Gandapur issued a notification appointing Mr Ustrana as his focal person on health and asked him to continue using the very office he had been directed by the Health Department to vacate. At the time, the newspaper reported that Ustrana had been removed amid allegations of illegal appointments and irregularities in tenders for medicines and hospital equipment, while NAB had already taken notice of the matter.
That episode inevitably adds context to his present position. Once again, the cover of a Board of Directors and powerful committees places him in a position of institutional influence. Whether this is simply another routine appointment or, yet again, a small and influential circle facilitating plans behind the scenes is something only the official record, the appointment files, and the decisions of the competent authorities can establish.
There are also allegations that individuals within the current provincial administration may have helped protect his position, including claims involving people close to sitting Chief Minister beneficiaries, his advisor, and officials in the parent department.
The more useful question for the government is straightforward: if there was no political intervention, can the relevant appointment and clearance files be made public?
The file should reveal who recommended Mr Ustrana, who vetted him, what declarations and background checks were obtained, whether NAB’s 2024 findings were considered, what the Health Department reported, and which authority ultimately approved his appointment. Transparency would settle the issue more effectively than denials. The most troubling aspect of the Ustrana episode is that it cannot be viewed entirely in isolation.
In recent years, KP has seen one governance and financial scandal after another emerge from within departments and public-sector institutions. In February this year, an official inquiry found that more than Rs700 million had allegedly been embezzled from two Sports Department projects, prompting NAB to seek the inquiry report. The Upper Kohistan scandal has involved allegations of more than Rs37 billion in misappropriation, with NAB arresting scores of suspects and the matter continuing through the accountability process. In the health sector, the provincial Anti-Corruption Establishment was still probing allegedly irregular appointments at Hayatabad Medical Complex in July 2026.
More disturbing is the apparent difficulty of bringing some earlier inquiries to a definitive conclusion. In December 2024, Dawn reported that several Health Department probes into alleged illegal appointments and financial irregularities had failed to reach a logical conclusion, citing one inquiry that allegedly identified corruption of Rs1.9 billion involving 16 officials, including senior health officials and a former health adviser. Taken together, these cases raise a question much larger than the appointment of one individual to one board.
The repeated emergence of such cases is evidence of a governance mechanism that has lost the capacity to detect, prevent, and decisively act against wrongdoing—or is there a deeper problem of selective accountability, political patronage, and institutional protection?
The distinction matters.
How can a government claim to be serious about good governance when its own appointment machinery appears capable of overlooking the very record that its accountability institutions had previously flagged?
And if the same patterns continue to emerge despite repeated inquiries, audits, NAB investigations and departmental probes, the public is entitled to ask one final question:
Is this merely bad governance - or has the system become so accommodating to influential individuals that bad governance is being allowed to become a method of governance?