Finance Ministry adviser Khurram Shahzad has clarified that the government has not announced any loan or sovereign guarantee to finance new aircraft for privatised Pakistan International Airlines (PIA).
In a post on X, Shahzad said the government was neither purchasing aircraft for PIA nor providing a taxpayer-funded loan or announced sovereign guarantee for the airline. He added that recent commentary appeared to misunderstand the privatisation process and the role of export credit agencies.
US EXIM Financing Framework Explained
Shahzad said the US Export-Import Bank (US EXIM), like other export credit agencies, supports American exports and jobs by helping foreign buyers finance US-manufactured aircraft. The financing can support airlines and other eligible purchasers without automatically requiring a sovereign guarantee.
He explained that US EXIM’s framework allows asset-backed aircraft financing, where the aircraft itself can secure the financing. Credit can also be assessed based on the airline, lessee or another guarantor when applicable.
“A sovereign guarantee is therefore not an automatic requirement,” Shahzad said. He stressed that financing arrangements can depend on the specific structure and parties involved.
Government Outlines Role After Privatisation
The adviser said the government’s role remains focused on facilitating access to international financing, technology and suppliers. He added that authorities also aim to encourage investment and create commercial opportunities for the private sector.
Shahzad said the government’s broader economic policy seeks to reduce the state’s involvement in commercial activities through privatisation. According to him, the approach aims to create greater space for private capital and private-sector-led growth.
He clarified that reducing the state’s commercial role does not mean abandoning private businesses. Instead, he said the government intends to enable businesses to operate and expand rather than directly running commercial enterprises.
The clarification comes amid discussions about financing options for PIA’s future aircraft fleet following the airline’s privatisation. The government maintains that any financing arrangement should support commercial operations without automatically placing the burden on taxpayers.
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