In a move to address the economic woes and reduce the financial burden, Pakistan International Airlines (PIA), which was once a major airline is reportedly exploring the sale of its debt-ridden national carrier.
According to the ARY report, the government is actively seeking buyers for a 51 to 100 per cent stake in PIA as part of a broader effort to reform state-owned enterprises under a USD 7 billion International Monetary Fund (IMF) program. This could pave the way for a government-to-government (G2G) sale, with Qatar and Abu Dhabi emerging as potential contenders
The financial struggles have been a long standing issue for PIA as the Pakistan national carrier has suffered a significant losses exceeding USD 3.6 billion over the past two decades.
According to Reuters, in the first nine months of 2023 alone, the airline reported a staggering PKR 75 billion loss.
Photo: Representative Image
Although, it is not new to privatise PIA by Pakistan as there were efforts made by the country earlier as well. In 2016, a government-led attempt to sell the airline met with fierce resistance, including a strike that led to a weeklong suspension of flights. This time, however, the scenario looks different, with the military-backed Strategic Investment Facilitation Council (SIFC) playing a important role.
As per ARY News, this council aims to streamline the privatisation process and has already laid out plans to invite expressions of interest (EOIs) from foreign investors by November 30, 2024.
The Rejected Bid and New Prospects
Earlier this year, six groups were pre-qualified to bid for PIA, yet only one, the real estate firm Blue World City, submitted an offer - worth PKR 10 billion (USD 36 million) - for a 60 per cent stake. This bid was far below the government’s set minimum price of PKR 85 billion, leading to its rejection. As reported by ARY News, this decision was solidified on October 31, 2024, when the Privatisation Commission Board, under Minister Khan's leadership, turned down the bid and referred the matter to the Cabinet Committee for further deliberation.
PIA | Image Source: @omyplane/Twitter
Foreign Government Interest: Qatar and Abu Dhabi
As per reports, Qatar and Abu Dhabi have shown an interest in acquiring PIA.
In a report earlier this year, ARY News also indicated that investors from Qatar, Abu Dhabi, and even Saudi Arabia were briefed on PIA’s international routes, which have been pointed as potentially profitable assets.
With the SIFC's November 30 deadline for inviting EOIs fast approaching, the coming weeks will be crucial for PIA’s future. Whether Qatar, Abu Dhabi, or another interested party steps up to make a serious offer remains to be seen.
