Govt pushes for PIA privatisation through G2G agreements

ISLAMABAD: The government of Pakistan is intensifying efforts for Pakistan International Airlines (PIA) privatisation through a government-to-government (G2G) agreement, with a targeted deadline of December 31, ARY News reported citing sources.

According to informed sources, both Abu Dhabi and Qatar have shown keen interest in PIA privatisation, signalling a potential opportunity for foreign investment. The government is in active negotiations with these countries to finalise the terms of the deal.

Sources also revealed that the Securities and Exchange Commission of Pakistan (SECP) is reportedly offering significant incentives to investors interested in acquiring stakes in PIA. These measures are aimed at facilitating a smooth transition during the PIA privatisation process, ensuring that potential investors have access to the necessary support.

In a significant development, the reopening of PIA’s European routes has positively impacted the airline’s financial situation. Sources confirm that the airline’s revenues have been bolstered as it expands its operations in Europe.

PIA’s operations to the UK are set to proceed without any major hindrances. Sources confirmed that Britain had initially conditioned approval for direct flights on receiving clearance from the European Union Aviation Safety Agency (EASA). With this approval now in place, PIA is poised to begin direct flights to London and Manchester, significantly enhancing its connectivity to the UK.

As part of its strategy to improve operations and expand its network, PIA is set to activate four Boeing 777 aircraft, which will be deployed immediately to enhance flights to Europe and London. This move is expected to further strengthen the airline’s position in the international market.

The deployment of additional aircraft and the opening of new UK and European routes are anticipated to significantly improve PIA’s financial health. Sources indicate that these new routes will contribute to a reduction in the airline’s annual losses, helping stabilize its operations and provide long-term benefits.

With ongoing privatisation efforts, strategic route openings, and the deployment of additional aircraft, PIA is working towards improving its financial stability and operational efficiency. The government’s focus on foreign investments and aviation expansion underscores a determined effort to revitalize the national carrier and ensure its sustainability in a competitive global market.

In October 2024, Finance Minister Muhammad Aurangzeb stated that the incumbent government will complete the privatisation of the national carrier along with three power distribution companies (Discos) before 2024 culminates.

PIA privatisation, initially set to conclude by October 1, has been postponed to October 31 due to low bidder interest, ongoing court cases, ageing fleet issues, and civil aviation concerns.

He further said that government is working on PIA privatisation of sick units, and power sector reforms and for this, all necessary steps have been taken to achieve the objectives.