Abu Dhabi Investment Group’s silence: Privatisation Division forced to rethink airports outsourcing plan

ISLAMABAD: The continued silence of the Abu Dhabi Investment Group regarding the takeover of Islamabad International Airport on a G2G basis has reportedly compelled the Privatisation Division to rethink its plan to outsource operations of three major airports, well-informed sources told Business Recorder.

The issue of outsourcing Islamabad International Airport, Jinnah International Airport, Karachi, and Allama Iqbal International Airport, Lahore, was taken up during a meeting of the Cabinet Committee on Privatisation (CCoP), chaired by Deputy Prime Minister/Foreign Minister Senator Ishaq Dar on November 28, 2025.

According to the sources, the Privatisation Division informed the meeting that the Abu Dhabi Investment Group has remained unresponsive on the Islamabad airport transaction and has not replied to repeated official communications from Pakistani authorities.

G2G framework: Plan approved to hand over Islamabad Airport operations to UAE

The CCoP, the sources said, agreed to place two airports, Allama Iqbal International Airport and Jinnah International Airport, on the active privatisation list. It also directed the authorities to send a final communication to the Abu Dhabi Investment Group seeking its position on the Islamabad airport.

“If the UAE party does not respond, the Privatisation Division will be authorised to place all three airports for open competitive bidding next Friday,” the sources added.

The Privatisation Division further briefed the CCoP that the Pakistan Airports Authority (PAA) intends to outsource operations of the three major airports to improve service quality, ensure efficient management, and attract private investment and expertise in line with international best practices.

The outsourcing scope covers the landside and apron areas of the airports. The landside includes public-access areas such as terminals, parking, and commercial facilities. The apron area includes aircraft parking, loading, unloading, re-fuelling, and boarding zones. The airside — including runways and taxiways — will remain under exclusive state control due to security and regulatory considerations.

The initiative is expected to boost revenue generation and optimise asset utilisation, and is aligned with the government’s broader policy to promote public-private collaboration for improved infrastructure and service delivery.

Earlier, the PAA initiated the outsourcing of Islamabad International Airport under the Public Private Partnership Authority (P3A) framework and appointed the International Finance Corporation (IFC) as financial adviser. After completing due processes, a Request for Proposal (RFP) was issued under PPRA rules.

The transaction is now being pursued under the Inter-Governmental Commercial Transactions Act, 2022. Outsourcing of the other two airports remains at a preliminary stage.

Following directives from the Prime Minister to fast-track the outsourcing, the Adviser to the PM on Privatisation held multiple meetings with senior officials of the Ministry of Defence and the PAA to evaluate various options. Given the urgency, it was deemed appropriate to place all three airport transactions on the active privatisation list.

A draft summary was shared with the Ministry of Defence — which oversees the PAA — for comments. The Ministry endorsed the proposal to include all three airports in the active list.

The matter was subsequently placed before the Privatisation Commission (PC) Board, which also endorsed the proposal, subject to CCoP approval.

In view of these recommendations, the CCoP considered and approved the inclusion of all three airport outsourcing transactions in the active privatisation list.

Copyright Business Recorder, 2025