KARACHI: Pakistan will privatize 75 percent of its national carrier, Pakistan International Airlines (PIA), while retaining its name and branding, the Prime Minister’s Office said on Thursday, adding that bidding will begin soon among four shortlisted investor groups.
The decision marks Islamabad’s most aggressive push in decades to reform the debt-ridden airline, which has accumulated more than $2.5 billion in losses and become a major burden on the national budget. Once regarded as one of Asia’s premier carriers, PIA has struggled with chronic mismanagement, political interference, overstaffing, mounting debt and operational issues that led to a 2020 ban on flights to the European Union and United Kingdom after a pilot licensing scandal. Privatizing the airline is also a key requirement under Pakistan’s $7 billion International Monetary Fund (IMF) program agreed last year.
On Thursday, Prime Minister Shehbaz Sharif chaired a meeting on the airline’s privatization where officials briefed him on the transaction structure and business plan. He directed authorities to “swiftly and transparently” complete the long-delayed process.
“The bidding process will begin soon and 75 percent of PIA’s shares will be privatized,” the PM Office said in a statement.
“Under the privatization terms, PIA’s name and theme will not be changed after the transaction,” it added. “Under the business plan, the number of airworthy aircraft in PIA’s fleet will be increased from 18 to 38 by 2029.”
The statement said Sharif also directed authorities to prepare a plan to increase the number of airworthy aircraft in PIA’s fleet and ensure timely departure of PIA flights. The plan also envisions expanding PIA’s operations from 30 to over 40 cities by 2029.
In July, Pakistan prequalified four investor groups for the sale: A consortium of major industrial companies, Lucky Cement, Hub Power Holdings, Kohat Cement and Metro Ventures; a consortium led by Arif Habib Corporation with Fatima Fertilizer, The City School and Lake City Holdings; Fauji Fertilizer Company, part of a military-backed conglomerate; and Airblue, a private Pakistani airline.
PIA has relied on government bailouts for decades, with repeated attempts at privatization collapsing due to union resistance, legal challenges and limited investor interest. A deal late last year also fell through after a potential buyer reportedly offered just $36 million for a 60 percent stake, far below the asking price of roughly $303 million.
Earlier in November, Pakistan’s privatization chief Muhammad Ali had said the government aimed to finalize the airline’s sale by October, but the target was missed due to delays in restructuring and valuation.
