PIA (Pakistan International Airlines) is facing a financial crisis that hasforced it to ground several aircraft while it seeks funding to sustain itsoperations in the coming months. During this period, the airline plans toput both its core functions and non-core assets up for sale.
The Ministry of Aviation issued a stern warning, highlighting the severecash flow issues plaguing PIA, resulting in outstanding debts with variousstakeholders, including creditors, aircraft lessors, fuel suppliers,insurers, international and domestic airport operators, and even theInternational Air Transport Association (IATA).
As a result of its financial predicament, the national flag carrier hashad to ground five of its 13 leased aircraft, and there is a possibilitythat four more could face a similar fate, as indicated by the ministry.Furthermore, the Ministry of Aviation revealed that Boeing and Airbus areon the brink of discontinuing the supply of spare parts by mid-September.
In light of these challenges, the ministry has urgently requested aninfusion of Rs23 billion in cash and the suspension of duties, taxes, andservice charges to domestic agencies. It is worth noting that this requesthas been made without the presentation of a concrete and viable businessplan.
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The ministry has emphasized that the restructuring of PIA is a complexprocess expected to span approximately eight months. Additionally, itstressed that for the divestment of PIA’s shares to generate a fair value,the airline must remain operational throughout all stages of therestructuring process.
