Pakistan authorities make fresh effort to sell cash-strapped PIA

Islamabad: Pakistan authorities decided to make a fresh effort to sell the state-owned airline after the botched attempt last year, it emerged on Friday.

Privatisation of the cash-strapped Pakistan International Airlines (PIA) has been on cards for years but a serious bid was made in 2024 but it failed when the government failed to attract any major buyer and the lone bidder offered a paltry Rs10 billion which was rejected.

Privatisation and Investment Minister Abdul Aleem Khan last month stated that all steps to privatise PIA will be completed by May.

A meeting of the privatisation commission on Wednesday, which was chaired by Muhammad Ali, commission chairman and the Adviser to the Prime Minister on Privatisation, decided to begin the sale process from next week.

“A fresh advertisement for [the] expression of interest for the demerger of PIACL is planned to be published next week,” the statement read, adding that the meeting will continue tomorrow “to consider the remaining items on the agenda”.

The commission also approved the pre-qualification criteria for selection of potential bidders for privatisation of 51 per cent to 100 per cent shares of Pakistan International Airlines Corporation Limited (PIACL).

The renewed process to get rid of the airline comes days after a PIA spokesperson said earlier this month that the financial results for 2024 showed the airline achieving a net profit after around 21 years.

According to the results for FY2024, PIA earned an operational profit of Rs3.9 billion and a net profit of Rs 2.26 billion.

The airline became unprofitable in 2011 and had been running on government subsidies which ran into billions of rupees.

The latest profit became possible after the government took responsibility to tackle more than Rs 600 billions in debts and interest payments of the airline separately and made it debt free.

The PIA has been in financial crisis since many years now. The issues came to the fore in 2023 when 7000 employees of PIA did not receive their salaries for November 2023. Prior to this, the European Union banned PIA in 2020 over safety concerns.