Government cites low bidder interest and unresolved issues for delays in the privatisation process of Pakistan International Airlines

In a significant development for Pakistan International Airlines (PIA), the government has announced that the final auction of the financially troubled national carrier will take place on October 30. This announcement was made by Parliamentary Secretary for Communication Gul Asghar Khan during a session of the National Assembly on Wednesday, responding to queries from Pakistan Peoples Party (PPP) MNA Sharmila Faruqui.

Originally set for October 1, the bidding process faced delays attributed to a lack of interest from potential bidders and several unresolved issues, according to sources familiar with the matter. These complications reportedly include ongoing court cases, an ageing fleet, and various civil aviation challenges.

Khan elaborated that the privatisation of PIA is a comprehensive undertaking that involves multiple stages and institutions. The process commenced in February 2024 and is now nearing completion, with the auction scheduled to finalise the sale of the loss-making airline.

During the assembly session, Khan underscored the intricate nature of the privatisation effort, which is overseen by the Privatisation Commission Board, led by the minister and secretary Usman Bajwa. He reassured lawmakers that PIA’s operational assets have been effectively segregated, facilitating the auction under the PIA Corporation.

The parliamentary secretary highlighted that the Cabinet Committee on Privatisation had previously approved the decision to privatise PIA. As part of the final preparations, Bajwa recently informed the National Assembly’s Standing Committee on Privatisation that bid documents had been shared with six pre-qualified bidders.

These consortia vying for a 60% stake in PIA include Fly Jinnah Limited, Air Blue Limited, Arif Habib Corporation Limited, a consortium led by YB Holdings (Private) Limited, another led by Pak Ethanol, and Blue World City. The involvement of these entities signals a continued interest in revamping PIA, which has struggled with mounting losses and operational inefficiencies.

As the auction date approaches, stakeholders are keenly observing how the bidding process unfolds, particularly in light of the challenges that have historically plagued PIA. The outcome of the auction will not only determine the future of the airline but also set a precedent for the privatisation of other state-owned enterprises in Pakistan.

The impending auction represents a critical juncture for PIA, which has long been a burden on the national exchequer. With mounting debts and operational losses, the government hopes that privatisation will inject much-needed efficiency and financial viability into the airline.

As the final auction draws near, the focus now shifts to the bidders and their proposals, with many hoping for a turnaround that could restore PIA’s status in the competitive aviation market