ISLAMABAD – The national carrier of Pakistan confirmed on Saturday that its financial issues have “eased out” after the caretaker government released funds aimed at supporting the airline.
In a social media post, the carrier said the restructuring of the airline was also underway, without revealing any further details.
#PIA's financial challenges ease out as @GovtofPakistan supports with release of some critical funds through Banks. The funds shall be used to clear long standing dues of Aircraft & Engine leases, Spares Support & Handling payments at foreign stations. Restructuring also on track
— PIA (@Official_PIA) September 9, 2023
PIA’s challenges worsened after it was reported this week that the supply of spare parts to the carrier could be suspended over cash flow problems.
Earlier this week, the Economic Coordination Committee (ECC) also discussed issues pertaining to PIA which has been sustaining losses for quite a long period of time now.
After detailed deliberation, the participants decided to constitute a separate committee for the assessment of the restructuring plan of PIA but rejected the PIA’s demand for the provision of Rs22.9 billion and deferment of Rs1.3 billion per month to the Federal Bureau of Revenue (FBR) as well as loans and markup amount till the finalization of the restructuring plan.
During the meeting, the secretary Aviation gave a detailed briefing to the chair about the financial burdens, liabilities of PIA, and the need for restructuring the state-owned enterprise.
The participants of the high-profile meeting discussed and reviewed the timelines and costs of the restructuring plan and after detailed discussion, it was decided to constitute a separate committee for the assessment of PIA’s restructuring plan.
The participants also came to the conclusion that the Finance Division and State Bank of Pakistan would support PIA in dealing with its financial challenges after a concrete plan for restructuring the airlines was finalized and submitted to the satisfaction of the committee.
There have been demands for privatizing the national carrier due to its economic nonviability. Former Aviation Minister Khawaja Saad Rafique also stressed the importance of privatizing the carrier or else it would have to shut operations.
In the final days of the PDM regime, it was also decided to privatize loss-making Pakistan International Airlines during a meeting of the Cabinet Committee on Privatization chaired by then Finance Minister Ishaq Dar.
The committee “after deliberation decided to include Pakistan International Airlines Co. Ltd. in the list of active privatization projects of the ongoing privatization program, following an amendment in the law by the Parliament,” a finance ministry statement had said.
