ISLAMABAD: Federal Minister for Privatization Abdul Aleem Khan said on Thursday the privatization process of loss-making national carrier Pakistan International Airlines (PIA) would be completed in three months. 

Cash-strapped Pakistan is looking to offload a 51-100 percent stake in debt-ridden PIA to raise funds and reform state-owned enterprises as envisaged under a $7 billion International Monetary Fund program approved last year. A final bidding process for the airline’s privatization last October attracted just one bid of $36 million for a 60 percent stake in the national flag carrier. The government had pre-qualified six groups in June, but only real-estate development company Blue World City participated in the bidding process, placing a bid that is below the government-set minimum price of 85 billion Pakistani rupees.

Among concerns raised by potential bidders for the PIA stake include policy continuity, honoring contracts, inconsistent government communication, unattractive terms and taxes on the sector, and the flag carrier’s legacy issues and reputation.

Officials say PIA’s cumulative losses alone are close to $3 billion, with the total asset valuation of the airline standing at approximately $572 million.

“Federal Minister further mentioned that to make PIA’s privatization more attractive, a new roadmap is being provided and it is expected that all stages of this privatization process will be completed within the next three months,” Khan’s office said in a statement after he met the Australian High Commissioner to Pakistan and discussed the privatization of PIA. 

Last year, PIA resumed operations in Europe, after a 2020 ban by the European Union Aviation Safety Agency (EASA) over concerns about the ability of Pakistani authorities and its Civil Aviation Authority (PCAA) to ensure compliance with international aviation standards. EASA and UK authorities both suspended permission for PIA to operate in the region after Pakistan began investigating the validity of pilots’ licenses following a deadly plane crash that killed 97 people.

Pakistan hopes new European routes and flying approval to the UK will boost PIA’s selling potential.

“The privatization minister emphasized that there is an expectation of better expressions of interest from investors this time around as the introduction of PIA flights to Europe has made the privatization environment even more lucrative and favorable,” the statement said. “Due to recent measures, the national airline is ready to become profitable again.”

Khan added that PIA flights to the UK would also begin in three months.