The Privatisation Cabinet Committee has given approval for the splitting of the Pakistan International Airlines (PIA)’s non-core business and assets by the end of April this year from the Air Transport and Operations (ATO)—an initiative that might lead to the privatisation of the national airline.
On Friday a meeting was led by the Prime Minister—Shahid Khaqan Abbasi of the Cabinet Committee on Privatisation (CCoP), held at the Prime Minister’s office.
The meeting discussed problems related to the two loss-making national organizations—Pakistan Steel Mills (PSM) and Pakistan International Airlines (PIA).
A detailed presentation was given on the national flag carrier followed by a discussion, after which a green signal was given to the proposal for staring the restructuring process in PIAC.
During the meeting, it was decided to separate the core and non-core business of the airline.
Daniyal Aziz—Federal Minister for Privatisation made an announcement last month that the segregation of the Pakistan International Airline’s non-core business and assets from the air transport-related operations would be completed by April, and the divestment deal would be finalized before the government’s tenure ends this year in June.
The deadline of the parliament’s Pakistan International Airlines Corporation (Conversion) Act—2016 was to end by April this year. Under the PIAC Act, the segregation of the core and non-core business functions of the PIA must be finished in two years of the portrayal of the law.
As per the data of March 2017, the losses incurred by the PIA were recorded at rupees three hundred and twenty-five billion.
The prime minister noted that the negligence of the two most significant organisations had affected badly in multiple ways. It has caused huge financial liability per year for the government and has also created many difficulties for the employees of the firms.
The meeting also discussed many issues relating the financial, administrative and employee-related problems of Pakistan Steel Mills (PSM).
One proposal for PSM to enter into a business deal with the investors, on profit sharing basis was also discussed.
The prime minister instructed that all possibilities should be considered, and a detailed plan should be drafted for addressing the employee related problems.