Govt decides to privatise loss-making PIA

ISLAMABAD: In a major development, the Cabinet Committee on Privatisation (CCoP) on Monday gave its nod to the privatisation of Pakistan International Airlines (PIA), ARY News reported on Monday.

The decision was made during a meeting of the Cabinet Committee on Privatization (CCoP), with Finance Minister Senator Ishaq Dar in chair.

The meeting considered the proposal of the Privatisation Commission regarding the inclusion of Pakistan International Airlines Co. Ltd (PIACL) in the privatisation programme.

The CCoP after deliberation decided to include Pakistan International Airlines Co. Ltd (PIA) in the list of active privatisation projects of the ongoing privatisation programme, following an amendment in the law by the Parliament.

Privatisation Division presented a summary of detailed updates regarding the privatization of the Roosevelt Hotel.

The CCoP after discussion gave concurrence to the Privatisation Commission for hiring of Financial Adviser to process/structure transactions of Roosevelt Hotel, New York, an asset of PIA Investment Limited (PIA-IL).

Earlier, Aviation Minister Khawaja Saad Rafique warned that Pakistan International Airlines (PIA) may endure alarming losses of Rs259 billion by the year 2030 if urgent corrective measures are not implemented, which includes the transfer of its administrative control to the private sector.

The federal minister made these remarks while speaking on the Senate floor after tabling “The Pakistan International Airlines Corporation (Conversion) (Amendment) Bill, 2023”.

Saad Rafique emphasised the necessity of Foreign Direct Investment (FDI) and granting administrative control to the private sector to sustain PIA. “The airline is facing a daunting debt burden of Rs742 billion,” he noted.

However, due to severe opposition from Senators, the Senate Chairman referred the standing committee concerned, stating that the injection of FDI and administrative control to the private sector was essential to make PIA a profitable entity.

The bill proposes an amendment to Section 3 which says “the shareholders of the company shall be deemed to own and hold the same number of fully paid shares with such rights and privileges, including as to class, kind and face value, as they owned and the Federal Government may, during the validity period and by notification in official Gazette, issue fresh shares or cancel any shares as it may deem fit.”