ISLAMABAD, Aug 12: A meeting here on Monday approved PIA’s $1 billion financing plan to buy new and old planes to upgrade the airline’s fleet.

According to official sources the meeting, which was presided over by Minister for Finance Shaukat Aziz and attended by PIA Chairman, Managing-director and its Board members, approved $1 billion financing plan for which the federal government will provide $150 million in three instalments.

Initially, $30 million would be extended this year while two instalments of $60 million each would be provided in 2002 and 2003 by the federal government, informed sources said.

The sources further said while the federal government would extend sovereign guarantee for buying planes, it had made it clear that there would be supplier’s guarantee that no commission, no fee or consultancy would be offered to anyone to borrow or take planes on lease.

The finance minister made it clear that his ministry had nothing to do with the fleet selection but the government would not tolerate any under-hand deal to benefit any individual or group.

“You may borrow or get planes on lease but everything should be transparent,” the sources quoted the minister as saying.

The sources said the meeting was told that US Exim Bank would offer loaning to PIA on behalf of Boeing Company while Airbus Company had its own financing consortium to deal with the issue.

The ten-year business plan envisaged gradual replacement of old aircraft with the induction of new technology aircraft to fulfil the requirement of the airline to compete with other world’s airlines.