BIG jolt to bankrupt Pakistan, PM Shehbaz Sharif to sell loss-making Pakistan International Airlines under IMF loan pressure
Pakistan has taken a significant step to sell state-owned Pakistan International Airlines (PIA) under pressure from the International Monetary Fund (IMF) under the terms of the IMF’s $7 billion loan package. Who are the bidders for privatization?
Under pressure from the International Monetary Fund (IMF), Pakistan has taken a significant step to sell state-owned Pakistan International Airlines (PIA) under the terms of the IMF’s $7 billion loan package. The IMF team is assessing and reviewing the US$7 programme, and Pakistan needs to convince it to receive the next US$1 billion tranche. The Pakistani government tried to sell PIA last year in 2024 due to heavy losses.
The government put up shares ranging from 51 percent to 100 percent for sale. However, it failed to get an attractive offer with a single offer of Rs 10 billion from a local property developer. The offer was rejected and the plan was cancelled.
Prime Minister Shehbaz Sharif held a meeting for privatization of PIA
According to the press release published by state broadcaster PTV News on channel X, Pakistani Prime Minister Shehbaz Sharif held a meeting with all corporate entities and company representatives involved in the privatization process of the national airline.
Prime Minister Shehbaz Sharif said that privatization was to regain the lost prestige of PIA and said, “PIA’s tender will take place on December 23 and will be broadcast live on all media.”
“We ensure transparency and merit in the privatization process of PIA,” he was quoted as saying.
Who are the bidders for privatization?
The sale of PIA will be Pakistan’s first major privatization in nearly two decades. According to Dawn, four bidders have been prequalified, including Lucky Cement Consortium, Arif Habib Corporation Consortium, Air Blue Limited and Fauji Fertilizer Company Limited, part of the military-run Fauji Foundation.
Pakistan is targeting 86 billion rupees from privatization revenues this year, Privatization Minister Muhammad Ali told Reuters. In the last round of bidding, it was decided that the government would receive 15 percent of the proceeds from the sale of PIA. PIA is going through a crisis due to years of poor finances and corruption.
Pakistan relies heavily on privatization to repay its loans and receive IMF bailouts. Pakistan is the IMF’s fifth largest debtor and is on the verge of bankruptcy. It has received more than 20 loans from the IMF since 1958.
