The Privatization of PIA: Progress and Concerns

The process of privatizing Pakistan International Airlines Corporation Limited (PIACL) has been a topic of concern for the Senate Standing Committee on Privatization. The committee, led by Senator Dr Afnan Ullah Khan, recently held a briefing to discuss the progress of the privatization of PIACL, as well as other privatization-related developments such as the Roosevelt Hotel, Precision Engineering Complex (PEC), and outsourcing of services at major airports.

PIACL Privatization Progress

The committee was informed that the privatization of PIACL is expected to be finalized by the end of this year. However, there is concern over the lack of interest from major international airlines in the process. Officials from the Privatization Commission (PC) stated that the opportunity to invest in PIACL has been marketed across the region, but leading regional airlines are hesitant to invest in a competitor.

This is the second attempt at privatizing PIACL, and currently, four consortiums or bidders have expressed interest in the process. Discussions are ongoing regarding the terms, conditions, and liabilities among stakeholders. The PC secretary assured the committee that after mutual consensus, the privatization of PIACL will be completed by the end of this year.

Transfer of Precision Engineering Complex

The committee was also briefed on the transfer of Precision Engineering Complex (PEC) from PIA Holding to the Pakistan Air Force (PAF). This transfer was in line with a Cabinet decision dated May 1. The complex, which spans 200 acres and employs 223 personnel, also carries liabilities of 381 retired employees.

According to the PC secretary, the PEC has been generating revenue of Rs397 million this year, but expenditures have exceeded Rs850 million. The ownership of the complex, along with all assets and liabilities, will now be under the Pakistan Air Force.

Outsourcing of Services at Major Airports

The committee was updated on the status of outsourcing landside services at Islamabad International Airport. It was revealed that a Turkish company had initially shown interest in the bidding process but later withdrew due to unresolved differences over the share ratio with the government. Currently, discussions are being held with the United Arab Emirates (UAE) for a potential government-to-government (G2G) management agreement.

Senator Afnan Ullah Khan recommended outsourcing these services to a reputable international firm capable of delivering efficient operations and world-class facilities in line with global standards.

Roosevelt Hotel Privatization

The committee was also briefed on the privatization of the Roosevelt Hotel in New York. The financial advisory firm JLL, appointed to assess the property, had earlier proposed a joint venture structure with multiple exit options for Pakistan. However, the proposal was withdrawn due to a conflict of interest, and the government is now seeking a new advisor to continue with the process.

FWBL Privatization

The successful privatization of First Women Bank Limited (FWBL) was commended by the