ISLAMABAD: The Privatisation Commission (PC) Board has tasked Financial Advisor Ernest & Young-led consortium to prepare a plan for the privatisation of Pakistan International Airlines Corporation Limited (PIACL) by end of December 2023, sources in the PC told Business Recorder.

On Friday (November 10) the interim cabinet approved the hiring of Ernst & Young-led consortium as FA for PIACL privatisation targeted to sell the loss-making entity by the end of its tenure.

Sources told Business Recorder that the decision to select the FA was made during the visit of the International Monetary Fund (IMF), and the caretaker government assured the Fund that the PIACL transaction would be completed in the earliest possible time.

Caretaker govt tells Senate: PIA sell-off plan still there in line with IMF deal

The staff-level agreement (SLA) with the IMF was reached on Wednesday, and the subsequent press release by the Mission leader stated: “Continuing state owned enterprise and government reforms to improve the business environment, investment and job creation.

Following passage of the state owned enterprises (SOE) law, the authorities are moving forward with their SOE policy and implementation of their triage plan including the privatization of select SOEs.“

A delegation from the International Civil Aviation Organisation (ICAO) was in Pakistan from November 5 to 10 and concluded an audit of the Civil Aviation Authority (CAA). The approval from the ICAO is critical to recommencing flight operations to Europe and the UK, following a ban effective from July 2021 onwards, to reduce the financial losses.

Recently Pakistan State Oil suspended the supply of fuel to the national airline due to payment issues. This led to the cancellation of hundreds of flights, pushing PIA on the verge of collapse.

During the crisis, the already debt-ridden carrier suffered financial losses of about Rs300 million daily, an official of PIA told Business Recorder on condition of anonymity.

The financial losses of PIA have been projected to reach Rs 153 billion in 2023-24 alone. PIA has suffered a total of $7.1 billion losses since 2012.

“The government has announced that PIA’s legacy liabilities would be parked in a holding company and only the current core assets and current liabilities would be offered for privatization,” interim Privatization Minister Fawad Hasan Fawad said in a press conference in October 2023.

Fawad said the list of assets to be sold includes PIA’s aircraft, routes, landing rights, core engineering and air service agreements.

With a 28 percent share in Pakistan’s 17 million annual air passenger market, PIA is still the largest single airline in the country.

According to the country’s Civil Aviation Authority, 40 percent of domestic air travellers and just 22 percent of international travellers used PIA in 2021-22 fiscal year.

Copyright Business Recorder, 2023

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Abdul Musawar Nov 18, 2023 03:31pm
Did any government has investigated that why this national carriers in debit for last 12 years?. And second is there in word any countries who has no is national Airline this question very important our government has no right to private PIA, this is our national Airline Pakistan and being a Pakistani working in Foreign country I have been shocked to listen this news. Our government if they are honest to Pakistan must realise there are some very talented people in Pakistan who are abilities to take out this national carriers from crieses. thanks
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Intelligent Investor Nov 19, 2023 08:45am
قطر ایئرویز والے انٹرسٹڈ ہیں PIA میں
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Mir Adnan Yakub Nov 19, 2023 06:27pm
May I request army chief to check the services of PIA at time of war. Pia supported Bosinia and supplied medicines. Better ask Nawaz sharif what he had sent to Bosnia herzogovinia. Before going for pia privatisation must consult your army chief of that time. How Pakistan helped Bosnia during war time and what was the services PIA and it's employee did fon the nation. Let me tell you, privatization means, Pakistan cutting his own hands and doing suicide.
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