Connect with us

Hi, what are you looking for?

Top Stories

Editor's Pick

Pakistan approves plan to sell PIA airline on eve of election

ISLAMABAD — Pakistan’s caretaker cabinet approved a privatization plan for loss-making Pakistan International Airlines on Tuesday, days after the country’s election panel directed it to refrain from making any final deal.

The cabinet’s approval is a crucial pre-requisite to taking the airline to market for a sale, which the election panel said should be put on hold until it has reviewed the plan.

The interim government recently sealed the plan to put the national carrier up for sale, Reuters reported last week.

“These steps will help attract the investors toward PIA,” the prime minister’s office said in a statement, adding that the transaction adviser Ernst & Young had completed a plan for the financial restructuring of the loss-making airline.

The statement did not refer to the directive from the election panel. But Prime Minister Anwaar ul Haq Kakar has previously said the process will be handed to the incoming government for further implementation, including carrying out the sale, after the cabinet approval of the restructuring of the airline for privatization.

The plan to tie an incoming government’s hands on privatization underscores the economic challenges a new administration will face under tough conditions imposed by an International Monetary Fund bailout, with the South Asian nation of 241 million people reeling from decades-high inflation.

The cabinet gave its approval on the recommendation of Pakistan’s privatization commission, a body assigned to sell off all loss-making state-owned enterprises (SOEs).

The restructuring plan has split PIA into two entities.

One ‘clean’ one will be offered up for sale and the other will be parked in a holding company with legacy debt, which includes negative equity of 825 billion rupees ($2.95 billion) in loans, creditors’ money and losses.

The statement from the prime minister’s office said the plan which had been approved would “divide the PIA into two companies, TopCo and HoldCo”.

It said PIA’s core operations, engineering, ground handling, cargo, flight kitchen, and training will be part of TopCo, while its precision engineering complex, PIA investment Ltd and other departments and properties will be included in HoldCo.

Pakistan agreed with the IMF last June to overhaul the SOEs under a deal for a $3 billion bailout and the outgoing government decided to privatize PIA just weeks after signing it.

The caretaker cabinet, which took office in August to oversee this week’s election, was empowered by the outgoing parliament to take any steps needed to meet the budgetary targets agreed with the IMF.

PIA has liabilities of 785 billion Pakistani rupees ($2.8 billion) and accumulated losses of 713 billion rupees ($2.55 billion) as of June last year.

Progress on privatization will be a key issue if the new government goes back to the IMF once the current bailout programme expires in March, analysts say. — Reuters

You May Also Like


As the world seeks sustainable and energy-efficient solutions for heating and cooling, the heat pump market is experiencing a significant surge. According to the...


The introduction of aggressive climate objectives by global economies and growing prospects for reducing carbon emissions are driving the growth of the district heating...

Editor's Pick

STOCK PHOTO Image by 165106 from Pixabay CANBERRA – Around 16,000 livestock remained in limbo aboard an export ship at an Australian port on Friday, having...


In the dynamic automotive sector, consistent growth of the electric vehicle (EV) charging industry has become increasingly evident. Consumers and businesses alike are recognizing...

Disclaimer:, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice.
The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2024 Secrets Of Richdads. All Rights Reserved.