The privatisation process for Pakistan International Airlines (PIA) faces another setback, adding to uncertainties about the airline’s future.
The government has postponed the financial bidding for PIA’s privatisation until October 31, due to low bidder interest and unresolved issues. This extension follows an earlier delay by the National Assembly’s Standing Committee on Privatisation, which had set October 1 as the deadline.
Contributing factors include unresolved court cases, an ageing fleet, and civil aviation concerns. Six consortia, including Fly Jinnah, Air Blue, and YB Holdings, had pre-qualified to bid for a 60% stake in PIA.
One of the most pressing issues is the European Union’s ongoing ban on PIA flights to Europe, historically one of the airline’s most profitable routes. Despite this challenge, PIA CEO Amir Hayat expressed optimism, indicating that the European Union Aviation Safety Agency (EASA) might lift the ban by the end of 2024 after a recent audit.
Privatisation Secretary Usman Bajwa stated that final bid documents were uploaded on September 18, allowing pre-qualified bidders to proceed with due diligence. He also outlined plans to expand PIA’s fleet from 20 to 40-45 aircraft over the next three to five years, aiming to reduce the fleet’s average age.
In terms of employee welfare, Rs35 billion has been allocated for PIA’s 7,360 current employees, with pensions for 16,000 retired workers to be covered by the government. Despite the delay, potential bidders are closely monitoring developments, particularly concerning the EU ban.
