Debt-ridden Pakistan International Airlines (PIA) said on Saturday that its financial woes have “eased out” after government released critical funds aimed at helping the national carrier.
Taking to social media platform X, formerly known as Twitter, the national carrier said: “PIA’s financial challenges ease out as government of Pakistan supports with release of some critical funds through banks.”
PIA, without dwelling into the figures, added that the funds shall be used to clear long-standing dues of aircraft and engine leases, spares support and handling payments at foreign stations.
“Restructuring also on track,” it added.
As per the latest financial results, PIA sustained losses to the tune of Rs64 billion in the first six months (January-June) of 2023, owing to high administrative and finance cost. This was substantially higher than the loss of Rs43.5 billion suffered in the same six-month period of the previous year.
Earlier this week, the Economic Coordination Committee (ECC) also discussed issues pertaining to the PIA.
During the meeting, the Ministry of Aviation submitted a summary regarding ‘Financial support for PIACL & its Restructuring’. Secretary Aviation gave a detailed briefing to the Chair about the financial burdens, liabilities of PIA and the need for restructuring of the organisation.
The ECC discussed and reviewed the timelines and costs of the restructuring plan.
After detailed discussion and deliberation, it was decided to constitute a separate committee for assessment of the restructuring plan of PIA, according to a statement issued at the time.
The ECC also rejected the request for deferment of payments of Rs1.3 billion per month which the airline pays to the Federal Board of Revenue (FBR) against FED (federal excise duty) and another Rs0.7 billion per month which it pays to Civil Aviation Authority (CAA) against embarking charges.
It was also decided that the Finance Division and the State Bank of Pakistan will support PIA to tackle its financial challenges after a concrete plan of restructuring of PIA has been finalised and submitted to the satisfaction of the Committee.
PIA was included in the ongoing privatisation program by the previous government.
The Privatisation Division recently also presented a summary on detailed update regarding the privatisation of the Roosevelt Hotel.
The CCoP, after discussion, gave concurrence to the Privatisation Commission for hiring of a financial adviser to process/structure the transaction of Roosevelt Hotel, New York, an asset of the PIA Investment Limited (PIA-IL).