Islamabad: Pakistan International Airlines (PIA) accumulated losses of approximately Rs500 billion between 2015 and 2023, officials informed the Senate Standing Committee on Privatization during a briefing on Monday.
Privatization Secretary Usman Bajwa told lawmakers that the government decided to privatize the national carrier due to its continued financial deterioration. According to Bajwa, the airline has been incurring annual losses of nearly Rs100 billion, placing a significant burden on the national treasury.
Moreover, officials emphasized that repeated financial bailouts failed to stabilize the airline’s operations. Consequently, the government concluded that privatization offered the most viable path to prevent further fiscal losses.
The briefing also highlighted that PIA’s financial challenges have persisted for years despite various restructuring attempts. Therefore, policymakers believe that transferring management to the private sector could improve efficiency and restore competitiveness.
Weak management blamed for operational failures
Meanwhile, officials told the committee that weak management remained one of the primary reasons behind the airline’s persistent losses. They explained that administrative inefficiencies and poor strategic decisions prevented the airline from achieving profitability.
In addition, the airline struggled to modernize operations and compete effectively with international carriers operating in the region. As a result, declining performance further worsened its financial position.
However, officials noted that PIA’s financial standing showed some improvement during the privatization preparation process. Earlier, the airline’s net worth had dropped sharply to about Rs9 billion.
Subsequently, authorities carried out an asset revaluation exercise that significantly raised the company’s estimated value. Following this reassessment, PIA’s net worth increased to around Rs41 billion before the government initiated the privatization process.
Officials told the committee that the revised valuation aims to strengthen investor confidence as authorities move forward with plans to sell stakes in the struggling national airline.
