In Karachi, the Pakistan International Airlines (PIA) faced a criticalfinancial situation that was threatening to disrupt its flight operations.To address this crisis, the airline successfully secured a substantial loanof Rs18 billion from two banks. This significant influx of funds provedinstrumental in clearing the essential outstanding debts, therebypreventing the suspension of flight services.
PIA’s spokesperson, Abdullah Khan, confirmed this development, emphasizingthe importance of these loans in maintaining the airline’s operations.Furthermore, Khan assured that PIA had dutifully met its payrollobligations by disbursing salaries to its employees, ensuring smoothfunctioning. Despite the financial turbulence, PIA has maintaineduninterrupted flight operations both domestically and internationally. Khanaffirmed that all flights continued to operate seamlessly.
Highlighting the airline’s resilience, he stressed that PIA’s solidfoundation and extensive global network provided the capacity to navigatechallenging circumstances. With an ample fleet of aircraft dedicated toboth international and domestic flights, PIA remained committed tosustaining its air services.
Earlier in the day, there were reports of PIA canceling a number ofdomestic and international flights due to severe cash flow problems. Theairline had been grappling with financial issues for some time, and therewere concerns that flight operations could be suspended by September 15 ifemergency funds were not secured.
To add to the airline’s financial woes, on September 7, PIA revealed thatit had grounded five of its 13 leased aircraft, with the possibility ofgrounding four more due to the ongoing financial crunch. The airline hadurgently requested a bailout of Rs22.9 billion, which was regrettablyrejected by the Economic Coordination Committee (ECC).
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Additionally, the ECC turned down PIA’s plea for deferment of monthlypayments totaling Rs1.3 billion to the Federal Board of Revenue (FBR) forFederal Excise Duty (FED) and Rs0.7 billion to the Civil Aviation Authority(CAA) for embarking charges.
Furthermore, PIA had issued a warning that Boeing and Airbus might suspendthe supply of spare parts by mid-September, posing additional challenges toits operations. In the previous month, the Federal Board of Revenue ofPakistan (FBR) had taken a stringent measure by freezing 13 PIA bankaccounts due to the airline’s failure to pay Rs8 billion in FED. Thisfurther exacerbated the financial predicament faced by the national flagcarrier.
