Islamabad_ Prime Minister Shehbaz Sharif on Wednesday announced that the bidding for Pakistan International Airlines (PIA) will be held on December 23, marking a major step in the government’s renewed effort to privatize the national flag carrier.
He made the announcement during a meeting with business leaders and company representatives in Islamabad, saying the process will be broadcast live to ensure government’s transparency and merit.
The government is moving ahead with PIA’s privatization as part of commitments under recent $7 billion IMF program. PIA is the first state-owned entity selected for full divestment under the new stated policy by the incumbent government.
However, a previous attempt of privatizing state-owned loss-making entity earlier this year did not succeed. Although six groups were pre-qualified in June only Blue World City took part in the final round, and its offer fell below the minimum price cap of Rs85 billion. The gap raised concerns about PIA’s debt, staffing, and limited control for the buyer.
To address these issues the government has now offered complete divestment plan, removed sales tax on leased aircrafts, and provided limited protection from legal and tax claims. In last fiscal year, nearly 80% of the airline’s debt has also been shifted to the state to make the transaction more attractive.
During the meeting, the prime minister said the process was moving smoothly and aimed at restoring PIA’s lost identity. He expressed confidence that the airline would again live up to its tradition of being “Great People to Fly With.” He added that improved global operations would benefit overseas Pakistanis and support Pakistan’s tourism sector.
