Federal Aviation Minister Khawaja Asif has announced that the privatization process of Pakistan International Airlines (PIA) will be completed by the end of October.
Speaking during a session of the National Assembly, Asif stressed the urgent need for privatisation, citing the airline’s heavy debt of Rs. 800 billion
The minister responded to a notice calling attention to the prolonged closure of Hyderabad airport for commercial flights, explaining that resumption of PIA operations on this route is not financially feasible due to the airline’s mounting debt.
“Routes that are not economically viable cannot operate,” he added.
Asif also noted that the government has no objection to private airlines operating from the Hyderabad airport, indicating potential opportunities for the private sector.
Meanwhile, Deputy Prime Minister Mohammad Ishaq Dar referred to the ongoing efforts to revive PIA’s flights to the UK, stating that important steps have been taken, including changes in aviation laws to meet the UK’s requirements.
Deputy Prime Minister Dar also confirmed that both the privatization of PIA and the outsourcing of Islamabad International Airport are on a fast track, with hopes of completion early next month.
PIA buyers seek investment protection
Local prospective buyers of Pakistan International Airlines (PIA) have sought protections currently available to foreign investors under an Act of Parliament and have also sought full exemption from taxes applicable on air travel, fuel and aircraft leasing.
Privatization Commission sources told The Express Tribune that some of the shortlisted parties had placed their demands before the government during the ongoing PIA due diligence process.
They said the demands along with their refusal to accept performance benchmarks made it more difficult for the privatization transaction to proceed smoothly.
The bidders’ demands contradict the agreement reached with the International Monetary Fund (IMF) which prohibits Islamabad from providing any special treatment to any section of investors, according to finance ministry officials.
The government has roped in Airblue, Arif Habib Corporation, Blue World City, Fly Jinnah, Pak Ethanol (Pvt) Consortium and YB Holdings Consortium to privatize PIA.
It had originally planned to privatize the airline by June-July 2024, but later extended the deadline to October 1.
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