REPORTS that the lossmaking national flag carrier PIA has grounded 11 aircraft, or a third of its fleet, over the last two to three years is not surprising. The dearth of funds to procure spare parts to keep them operational is mainly responsible for this state of affairs. Last year, the airline was planning to purchase three wide-bodied planes to launch long-haul flights. To where? Now the PIA management is apparently trying to blame higher global oil prices and a weakening exchange rate for its financial crisis rather than admitting the real reason that has brought the company down. Spending on PIA is like burning cash. With its international flight operations curtailed significantly over safety concerns and new private airlines giving it a tough time on domestic routes, the airline, which is burdened with massive debt and other financial liabilities, has no future at the moment. The government is also not in a position to inject liquidity into the company or give sovereign guarantees to lenders on its behalf due to its commitments to the IMF. Also, what is the point in investing in a company that the authorities have put on the privatisation list?
As was widely anticipated, some employee pressure groups have already begun raising their voice against the planned privatisation of the airline to protect their interests. Some may be planning active protests soon. The authorities have capitulated more than once to such pressure that is hindering their revival and privatisation plans. The country no longer has the option to surrender to the opponents of privatisation this time around. Those who are against the new government plans concerning the national carrier must be made to see why their demands are not feasible. The worsening financial conditions of the bankrupt airline means the government must speed up the process of selling it — or liquidating it if it doesn’t find a buyer — to avoid further losses to taxpayers.
Published in Dawn, August 24th, 2023