December 29, 2023
2 mins read

Financial Burdens Derail Privatisation Plan for PIA

PIA has borrowed more than Pakistan rupee (PKR) 270 billion from the commercial banks on government guarantee….reports Asian Lite News

The privatisation plan of Pakistan International Airlines (PIA) has faced setbacks for the upcoming year as the privatisation commission couldn’t resolve issues related to loan repayments and legal matters, ARY News reported on Thursday.

It reported citing sources that the interim federal minister for privatisation, Fawad Hussain Fawad failed to implement to transfer of PIA to the private sector by January 2024.

PIA has borrowed more than Pakistan rupee (PKR) 270 billion from the commercial banks on government guarantee.

The Ministry of Finance will decide to meet the financial requirements of the PIA for the next three months.

Sources suggest that PIA cannot afford to pay more than PKR 8 billion in interest on the PKR 260 billion loan. The commercial banks involved in lending to PIA include the National Bank and Bank of Punjab, along with eight other commercial banks.

The decision to reschedule government loans until the privatization of PIA could not be finalized. The Ministry of Finance will establish a committee to decide on the financial requirements of PIA.

Sources told ARY News that the PIA’s financial affairs will be handed over to the Privatisation Commission as the latter would take measures to reduce its losses.

Sources further claimed that the commission will link the national carrier’s financial affairs with the latest system. By improving PIA’s financial affairs, the commission will improve its balance sheet – which will help in the carrier’s privatisation.

Earlier, The Express Tribune reported that the employees of airlines Pakistan International Airlines (PIA) have been affected due to the ongoing financial upheaval faced by the airlines which has left its 7,000 employees without salaries in November.

The airline’s CBA union president, Hidayatullah Khan, addressed the issue and alleged intentional salary delays by the PIA management.

Earlier in October, the financially-crippled airline was forced to cancel numerous domestic and international flights due to limited fuel supply from Pakistan State Oil (PSO), inconveniencing thousands of passengers, reported The Express Tribune.

The national flag carrier PIA has been criticised for inefficiency and has faced dwindling funds amidst the government’s battle with a balance of payments crisis arising from immense debt repayments.

According to recent reports, the PIA’s liabilities are Pakistani Rupee (PKR) 743 billion (approximately USD 2.5 billion), surpassing its total assets by five times.

Moreover, on October 14, PIA sought an additional loan of over PKR 7 billion from banks due to concerns about potential disruptions, partially or completely, as reported by The Express Tribune.

Later, PIA in a letter to the Aviation Division, requested an immediate loan of over Rs 7 billion from banks, with the Pakistan government guaranteeing an option for the airline to secure a loan of Rs 7.5 billion, The Express Tribune reported. (ANI)

ALSO READ: Breather for eight Indians on death row in Qatar  

Previous Story

Afghanistan’s Humanitarian Crisis Worsens: UNICEF

Next Story

India Steadies Sri Lanka’s Boat Amid Economic Turbulence

Latest from -Top News

‘Kill and Dump’ Haunts Balochistan Again

The latest killings have reignited accusations of extrajudicial executions and the use of counterterrorism laws to cover up custodial deaths in Balochistan….reports Asian Lite News Concerns have deepened across Balochistan following the

‘ASEAN Expands, But Keeps Its Soul’

Malaysian Foreign Minister Mohamad Hasan urged ASEAN to uphold its unity and strategic resolve amid intensifying geopolitical tensions and mounting external pressures…reports Asian Lite News Consensus and inclusivity will remain the cornerstones

Bangladesh bends to beat Trump’s blow

Dhaka seeks compromise as Trump’s 35% tariff looms large over key exports; Washington urges worker protections, factory relocation to US…reports Asian Lite News Bangladesh has opened the second round of critical trade

China seethes as US lands F-35s in PH

As US F-35 jets land in the Philippines for the first time, Manila cements its frontline role in Washington’s power play against rising China….reports Asian Lite News The Philippines is rapidly cementing
Go toTop

Don't Miss

Mian Saheb Back on Saddle

Relations between him and the army soured during his later

Pakistan Gears Up to Repatriate One Million Afghans

No date has yet been announced but the campaign to