PIA could be sold without any liabilities: Pakistan’s Privatization Minister
Federal Privatization Minister Abdul
Aleem Khan has indicated plans to privatize Pakistan International Airlines
(PIA) by selling it to a private investor free of liabilities. During a press
conference on Sunday, he also welcomed provincial governments to assume control
of the airline, suggesting that it could be managed more professionally under
their administration.
According to the minister, the
current restructuring plan places approximately Rs600 billion of PIA’s Rs830
billion debt in a holding company, leaving only Rs200 billion to be transferred
to a prospective buyer. If this approach fails to attract interest, the
government may devise a new plan to fully clear the remaining Rs200 billion and
present PIA as a “clean” acquisition opportunity for potential investors.
Read More Khyber
Pakhtunkhwa seeks control of PIA to preserve its symbolic value
Mr. Khan acknowledged that the
government’s initial attempt to privatize PIA was unsuccessful, partly due to
conditions set by prospective buyers. Some investors requested a waiver of GST
on new aircraft purchases, which could not be granted because of commitments to
the IMF.
Provinces Invited to Purchase PIA
The minister’s statements came
shortly after the government’s recent setback in its privatization efforts. The
sole bid for PIA, submitted by the Blue World City consortium, fell short of
the minimum price, offering only Rs10 billion against the government’s estimate
of over Rs85 billion. Since then, at least two provincial governments have
expressed interest in taking control of the airline.
Read More Punjab
Chief Minister shows interest in buying PIA, rebranding it ‘Air Punjab’
Mr. Khan confirmed that the
consortium was shortlisted under the legal framework but that its bid was
deemed unsuitable. He encouraged interested provinces to meet the legal
requirements if they wish to acquire PIA, noting that only Khyber Pakhtunkhwa
has formally submitted an expression of interest.
Reports also indicate that Punjab
Chief Minister Maryam Nawaz Sharif has discussed the possibility of acquiring
PIA with her father, PML-N president Nawaz Sharif. Mr. Khan suggested that
other provinces, including Sindh and Balochistan, might also consider taking
over the airline, as long as they bring in professional management to run it
effectively.
Privatization Process Challenges
Addressing criticism of his absence
from the recent bid event, Mr. Khan clarified that he was in Saudi Arabia
meeting with a minister to discuss investment opportunities in Pakistan. He
emphasized that the initial bidding process was conducted transparently with
international consultancy support and held previous administrations accountable
for PIA’s financial troubles.
The framework for PIA’s
privatization, developed by the caretaker government, may be adjusted as
needed, according to Mr. Khan. He affirmed that PIA remains a “national asset”
and should not be sold at an undervalued price, adding that the airline could
become profitable with new planes and professional management.
Read More PIA’s
privatization bid falls short due to investor uncertainty, says spokesperson
The final decision on whether to
proceed with provincial ownership or resume the privatization process will rest
with the prime minister.
Source: Dawn