Pakistan's Cabinet Committee on Privatization (CCOP) has given its consent to the initiation of a plan which, if completed, will see loss-making national carrier PIA - Pakistan International Airlines (PK, Islamabad International) being privatized.
In a statement issued on February 16, the CCOP said core and non-core assets would be separated as part of the restructuring process.
Prime Minister Shahid Khaqan Abbasi has been eager to put an end to PIA's consistent annual losses, now estimated to be PKK150 million rupees (USD1.35 million) per day. As such, to placate strong unionist and nationalist fervour, he has pledged that government would retain a controlling 51% stake as well as managerial control of the airline.
Despite assurances that the sale would be concluded by April 15 as stipulated under the PIAC Conversion Act of 2016, Privatisation Minister Daniyal Aziz has said the entire process, inclusive of studies, RFPs, negotiations, and the actual sale itself, would, in fact, last up to 30 months at the very least.
The privatization of the airline was one of the conditions Pakistan accepted as part of a USD6.67billion Extended Fund Facility (EFF) from the International Monetary Fund (IMF) in 2013. An attempt to push the process forward in late 2015/early 2016 through the sale of a 26% stake, met with fierce political as well as workforce resistance. The standoff culminated in a series of strikes that effectively grounded the airline for several days in February 2016 before the sale was called off.
