After an intense and unusually well-publicised competitive second round of bidding, the consortium led by Arif Habib Group has acquired 75 percent stake of Pakistan International Airlines for Rs135 billion. The buyer also retains the option to acquire the remaining 25 percent for another Rs45 billion, gradually reducing the state to a minority – or without any stake.
The buyer buys the Pakistan flag, the control of Pakistan’s national airline, its past glory and multiple soft and tangible assets, but not its past mistakes and accumulated losses.
The government has hailed the outcome as a landmark success being content that the sale is Rs20 billion higher than its initial offer and Rs35 billion above the reserve price – notwithstanding the fact that of the Rs135 billion purchase price, only Rs10 billion will flow to the government as immediate cash with a commitment that the remainder will be invested into the airline in stages. All prime real estate and vacant plots have been carved out. There is no hidden property windfall here—only an airline that has been bleeding for years.
But beyond the celebratory press releases lies a harder truth: this transaction is less about victory and more about last-chance survival and surrender. The sale of PIA is neither a national tragedy nor a triumphant reform. It is a calculated gamble taken after years of mis-governance left no alternatives. Pakistan has sold control of its flag carrier not because it wanted to but because it had exhausted every other option.
Moving beyond the sale are some searching questions: – what it means for PIA’s future, its employees, and the travellers, who for years have been denied the direct connectivity to their destination around the globe.
PIA has been an airline in decline whose troubles are neither new nor exaggerated. Operationally, the airline has been on a rapid downward trajectory for over a decade. Of the 38 aircraft it claims on paper, barely 18 are currently operational. Most are ageing, fuel-inefficient, and maintenance-heavy – an unforgiving disadvantage in a region dominated by modern fleets and ruthless efficiency.
Repeated turnaround plans have failed. Targets were missed, reforms diluted, and political interference remained entrenched.
The current management is nowhere near delivering on its latest business plan. There was absolutely no chance that PIA could ever have been turned around under the domain of the government.
In this context, privatisation is not a bold reform – it is an admission that the state no longer has the capacity, credibility, or discipline to run a commercial airline.
Private ownership offers PIA a narrow but genuine opportunity. Freed from bureaucratic paralysis, a professional management could finally take hard decisions: retire unviable aircraft, rationalise routes, renegotiate contracts, and invest in fleet renewal.
The staged capital injection promised under the deal will be decisive. If honoured in time and scale, it could stabilise operations and restore credibility with regulators, suppliers, and passengers.
But privatisation alone is not a magic wand. Without a broader clean-up of Pakistan’s aviation ecosystem – regulatory discipline, airport efficiency, and fair competition – even a privately-run PIA could struggle. The difference is that losses will no longer be masked by taxpayer bailouts, which is a significant relief to taxpayers.
No group is watching this deal more anxiously than PIA’s employees. For them it will not be business as usual. Years of political hiring turned the airline into one of the most overstaffed carriers in the region. A private owner will not tolerate this indefinitely.
Restructuring, early retirements, and layoffs are almost certain. This will be painful—but the alternative is worse. A collapsing airline would wipe out all jobs, not just surplus ones.
The real moral test lies with the government: whether it ensures fair severance packages, retraining options, and dignity in exit, or simply walks away after signing the deal.
For passengers, the implications could be quietly transformative. PIA’s decline has meant cancellations, delays, safety concerns, and shrinking international connectivity – particularly for Pakistan’s diaspora. A commercially run airline could reverse some of this damage: more reliable schedules, better aircraft availability, and improved service standards.
Whether this deal becomes a case study in successful reform or a cautionary tale of delayed decisions will depend on what happens next – not the headline price, but the discipline, investment, and political restraint that follow. For the first time in decades, PIA’s future is no longer guaranteed by the state. And that, perhaps, is exactly the point which could make a difference.
Yet, even as the curtain falls on state ownership, intellectual honesty demands a moment of tribute to those who once built – and later tried to rescue – Pakistan International Airlines.
PIA did not begin as a burden on the exchequer; it began as a symbol of national competence. Under the stewardship of Air Marshal Nur Khan and Air Marshal Asghar Khan, the airline was run with discipline, professional autonomy and an unambiguous meritocratic ethos, earning global respect at a time when few developing countries could operate a world-class carrier.
Decades later, when decline had already set in and political interference had hollowed out the institution, Tariq Kirmani’s entry from the corporate sector represented the last serious attempt to reverse the slide through governance reforms, commercial realism and insulation from vested interests. These endeavours once again brought the airline on track of success and survival with dignity.
That these efforts could not survive the tests of time and ultimately lost track was less an indictment of individuals and more a verdict on a system that could neither protect excellence nor sustain reform. As PIA enters a new chapter under private ownership, remembering these figures is not an exercise in nostalgia; it is in fact a reminder of what professional management can achieve when allowed to function, and of the heavy cost of denying institutions the autonomy they require to survive.
Copyright Business Recorder, 2025
The writer is a former President OICCI; Global Business Leader and Strategic Affairs Analyst