ISLAMABAD: Pakistan is set to broadcast live the auction of its loss-making national airline tomorrow, Pakistani state media reported on Monday, a move authorities say is aimed at ensuring transparency.

Pakistan will privatize 75 percent of the carrier, the Pakistan International Airlines (PIA), while retaining its name and branding, according to Prime Minister Shehbaz Sharif’s Office.

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.

Pakistan prequalified in July four consortiums for the sale, but Fauji Fertilizer Company Ltd. withdrew later. Lucky Cement and Arif Habib Corporation lead two other consortiums, while private airline Airblue is the third contender.

“The government plans a full divestment of the airline, beginning with the auction of a 75 percent stake on Tuesday, with the remaining 25 percent to be offered later at a 12 percent premium,” Pakistan TV Digital reported quoted Privatization Commission Chairman Muhammad Ali as saying.

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, United Kingdom and the United States (US) 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.

This is Pakistan’s third attempt at PIA privatization, following a failed 2024 auction that received only one bid of $35 million that was far below the government’s nearly $300 million asking price, according to Privatization Commission records.

The government is targeting $302 million in privatization proceeds this year, though Ali said restoring PIA operations remains a priority over maximizing short-term revenue. Islamabad plans to expand PIA fleet and route network under the new business plan.

Ali last month said the government had aimed to finalize the airline’s sale by October 2025 but the target was missed due to delays in restructuring and valuation.

The PIA sale is seen as a key test of Pakistan’s broader economic reform agenda as the government seeks to cut losses from state-owned enterprises and revive investor confidence.

Islamabad has launched a five-year privatization plan covering 24 state entities between 2024 and 2029, including the Roosevelt Hotel in New York, three banks, power distribution companies, and the Postal Life Insurance Company, according to the Privatization Commission.