The federal cabinet, just two days before the 2024 general elections, has greenlit the restructuring of Pakistan International Airlines (PIA), a move that may pose challenges for the incoming elected government.
Under the restructuring plan, the national flag carrier will be split into two entities: TopCo and HoldCo, with TopCo handling basic operations such as engineering, ground handling, flight kitchen, and training, while HoldCo will manage the Precision Engineering Complex, PIA Investment Limited, and related departments and properties.
The decision was made during a meeting chaired by Caretaker Prime Minister Anwaar-ul-Haq Kakar on Tuesday, where Caretaker Minister for Privatisation Fawad Hasan Fawad presented the proposal, emphasizing its potential to attract investors to PIA.
Furthermore, the cabinet directed the resolution of outstanding disputes regarding dues owed to government organizations by PIA to expedite the restructuring process.
The previous Pakistan Democratic Movement (PDM)-led government had announced plans to privatize the airline last August as part of a broader fiscal discipline strategy agreed upon under an International Monetary Fund (IMF) bailout.
PIA has long grappled with financial woes, with former railway and aviation minister Khawaja Saad Rafique warning of potential losses amounting to Rs259 billion by 2030 if urgent corrective actions, including transferring administrative control to the private sector, are not taken.
Additionally, PIA’s operations to Europe and the UK have been suspended since 2020 following the revocation of its authorization by the European Union’s Aviation Safety Agency amid a scandal involving pilot licenses.
