The loss-making Pakistan National Airlines (PIA) is being sold instead of fixed
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There have been attempts to privatize Pakistan national airlines (PIA) for several years, but news came recently when the airline’s board of directors approved a “scheme of arrangement” for privatization. In this regard, the federal government of Pakistan approved the formation of ‘Pakistan International Airline Holding Company’ to privatize PIA.
PIA has suffered losses for many years and is one of the government-sponsored enterprises that annually lose billions of rupees to the national exchequer. In the past, all attempts to bring about improvement through administrative changes have also failed. Efforts to privatize the institution were renewed during the caretaker government, and in its final days, the Cabinet approved the privatization.
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Finance Minister Muhammad Aurangzeb of the new government formed after the February 8 elections, expects the privatization of PIA to be completed by June. The privatization of PIA is currently in the ‘scheme of arrangement’ stage, which its board has approved of directors. Under this scheme, the majority shareholders in any company approve the privatization of the company. The Government of Pakistan holds the majority stake in PIA. Shahbaz Rana, a senior journalist who has a close eye on privatization issues, told BBC that the federal government has already approved the establishment of PIA Holding Company, regarding which PIA has a debt of 600 to 625 billion.
This will be done and will then become the federal government’s responsibility. He said the Privatization Commission would allow investors to express interest in privatizing PIA in April. The objective is for investors to submit their bids for purchasing PIA; later, these bids will be scrutinized. Shahbaz Rana further said that the government hopes the PIA auction will be held before the end of June.
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