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The Cabinet Committee on Privatisation (CCoP) approved the privatisation of Pakistan International Airlines (PIA) on Monday, which was a significant move.
Govt decides to privatise PIA: Finance Minister Senator Ishaq Dar presided over a meeting of the Cabinet Committee on Privatisation (CCoP), where the decision was taken.
The proposal from the Privatisation Commission to include Pakistan International Airlines Co. Ltd (PIACL) in the privatisation process was discussed during the meeting.
Following a change in the law by the Parliament, the CCoP agreed to add Pakistan International Airlines Co. Ltd (PIA) to the list of active privatisation projects of the current privatisation initiative.
A summary of in-depth updates about the privatisation of the Roosevelt Hotel was delivered by the Privatisation Division.
After discussion, the CCoP approved the engagement of a financial advisor by the Privatisation Commission to handle/structure transactions involving the Roosevelt Hotel in New York, an asset of PIA Investment Limited (PIA-IL).
Earlier, the aviation minister, Khawaja Saad Rafique, issued a warning that if immediate corrective measures, such as transferring administrative authority to the private sector, are not implemented, Pakistan International Airlines (PIA) could incur alarming losses of Rs259 billion by 2030.
When the “The Pakistan International Airlines Corporation (Conversion) (Amendment) Bill, 2023” was introduced, the federal minister made these statements while speaking on the Senate floor.
“Enhancing PIA Viability: Advocating FDI and Private Sector Control to Tackle Debt Burden”
In order to maintain PIA, Saad Rafique underlined the importance of Foreign Direct Investment (FDI) and giving the private sector administrative control. “The airline is facing a daunting debt burden of Rs742 billion,” he said.
But in response to fierce senatorial resistance, the Senate Chairman submitted the issue to the relevant standing committee, claiming that FDI infusion and transfer of administrative authority to the private sector were necessary for PIA to become a viable enterprise.
Section 3 of the bill states that “the company’s shareholders shall be deemed to hold the same number of fully paid shares with equivalent rights and privileges, including class, type, and face value, as they previously held. Additionally, the Federal Government, through an official Gazette notification during the validity period, may issue new shares or cancel existing shares as it sees fit.” The proposed amendment would make this statement true for all shareholders of the company.