PIA to be sold this year, but buyers won’t get guarantees: Privatisation Commission chief

KARACHI: The government plans to complete the sale of Pakistan International Airlines (PIA) within this year but will not extend any guarantees to prospective buyers, Chairman Privatisation Commission Muhammad Ali said on Monday.

In an interview on Aaj TV’s News Insight with Amir Zia, which aired Monday night, Ali said the IMF has approved the withdrawal of sales tax on the transaction, but other forms of investor assurances would not be offered.

“Governments change, and running airlines or businesses is not the mandate of provincial administrations,” he noted.

HBFCL, PIACL and airports: Major decisions made on selloffs

Responding to concerns over the slow pace of privatisation, Ali said the process had begun with smaller, less complex transactions, such as the partial transfer of First Women Bank, before moving toward larger divestments.

Responding to a question about government-to-government (G2G) transactions in the privatization process, Ali said the issue was not merely about Western interest or its absence. Instead, Pakistan’s own governance gaps, corruption, and economic vulnerabilities had weakened its position and limited the country’s ability to negotiate stronger outcomes.

He noted that major economic and geostrategic powers naturally gain leverage in G2G deals, especially when the other side lacks bargaining strength. In his personal view, Pakistan should avoid relying on G2G arrangements in privatisation wherever possible, arguing that competitive and transparent processes offer better protection for national interests.

He said the federal government has not yet resolved the question of which authority, NEPRA or the government, must approve the transfer of K-Electric’s shares. Ali also acknowledged that the original sale of K-Electric suffered from inadequate due diligence.

The chairman said that next year, the government plans to privatise Islamabad Electric Supply Company (IESCO), Faisalabad Electric Supply Company (FESCO) and Gujranwala Electric Power Company (GEPCO). He added that the authorities are considering the Turkish model, which allows private operators to run utilities on long-term concessional terms.

Ali said Karachi and Lahore airports each require about $1 billion in capital for expansion, which the government expects private operators to mobilise once the airports are outsourced.

On the gas sector, he said growth had stalled and structural reforms were necessary. “For the sector to move forward, the Sui gas companies will have to be sold,” he said.

Copyright Business Recorder, 2025