ISLAMABAD – Pakistan’s federal government has once again affirmed to privatize the cash-strapped national carrier with a renewed hope to get a better bidder.
The privatization ministry announced in a statement on Wednesday that fresh bids would be sought from the bidders next week though an earlier effort to privatize the airline cost the taxpayers $4.3m.
Though Privatization and Investment Minister, Abdul Aleem Khan had said last month that the government would complete all the steps to privatize the airline by May, the fresh efforts might delay the process once again.
Meanwhile, the privatization commission has also approved a transaction structure for the privatization of the struggling airline based on a divestment of 51 to 100 per cent of its shares of capital.
To privatize the airline and invite fresh bidders, the privatization commission held a meeting today chaired by Muhammad Ali, commission chairman and the Adviser to the Prime Minister on Privatization.
After the meeting, an official statement confirmed that the pre-qualification criteria for selection of potential bidders for privatization of shares of PIA has been approved.
‘A fresh advertisement for [the] expression of interest for the de-merger of PIACL is planned to be published next week,’ it read.
The development comes a few days after a PIA spokesperson said that the carrier’s board of directors approved its financial results for 2024, which depicted the airline achieving a net profit after around 21 years.
The results for FY2024 – which were hailed by the government also – reflected that PIA earned an operational profit of Rs3.9 billion and a net profit of Rs2.26bn.
PIA’s struggles started in 2011 when it became unprofitable and needed government’s subsidy for operation. Tax-payers money was continuously pumped into the airline to keep it afloat; however, the airline continued to nosedive in terms of sustainability and profitability.
In November 2024, the government tried to privatize the airline; however, the bidders were only willing to give 10b to the Pakistani government against the minimum sale price of Rs 85 billion. The exercise was conducted after thorough research and investing millions of dollars regarding the feasibility study.
With the lifting on ban from the European Union and resumption of flights to France, the government hopes to get a better deal this time though flights to the United Kingdom are still banned.
