Islamabad, Dec 19: Law Minister Azam Nazeer Tarar expressed confidence that the Pakistan government will receive better bids in the second attempt to privatize Pakistan International Airlines (PIA).
During a National Assembly session, the PIA privatization issue was discussed, with former commerce minister Naveed Qamar raising concerns over the previous failed attempt. He questioned the timeline for the initiative and emphasized the need for careful planning in the process.
In response, Minister Tarar stated that the government is optimistic about better bids this time, citing the positive development of restoring PIA’s European routes. He assured that lessons learned from past setbacks have been incorporated into the current strategy.
Tarar also mentioned that the term of PIA’s former CEO Aamir Hayat has ended, and he has been reassigned to his parent department. He noted that only a few countries worldwide still operate state-run airlines, suggesting that privatization might be more in line with global practices.
Earlier reports indicated that the International Monetary Fund (IMF) has agreed to Pakistan’s conditions for PIA privatization. Sources revealed that the IMF approved the elimination of sales tax on aircraft purchases or leases for buyers and the settlement of equity losses related to the privatization. With IMF approval, prospective buyers will be granted sales tax exemptions on aircraft purchases or leases for all routes. This change, along with the removal of equity losses, could increase the bidding value for PIA to as much as Rs350 billion.
Additionally, PIA’s lease agreements will benefit from a monthly sales tax exemption amounting to around 8.1 million rupees, according to sources.
