The Pakistani government is proceeding with plans to privatise PIA - Pakistan International Airlines (PK, Islamabad International) and will launch a fresh expression-of-interest campaign by the end of April, a government adviser on privatisation told Reuters. At the same time, the government has conceded that it will not have privatised the airline by the July 2025 deadline set down by the International Monetary Fund (IMF).
"In our last attempt to privatise PIA, pre-qualified bidders had some issues with taxation and the balance sheet. Those are taken care of now," Muhammad Ali told the news agency.
A bid to privatise PIA in 2024 failed after the highly anticipated auction attracted a single bid that was well below the government's reserve price. While the government had removed the bulk of PIA's liabilities to a separate holding company, a substantial amount remained. That, combined with a refusal to remove general sales tax from new aircraft purchases, deterred buyers.
PIA's privatisation, along with the whole or partial privatisation of other state-owned entities, is being monitored by the IMF, which has provided Pakistan with a USD7 billion bailout package but requires reform of state-owned entities in return. As part of that deal, July was the negotiated deadline to privatise the airline. As recently as March, Pakistan's privatisation minister, Abdul Aleem Khan, was saying that the sale and privatisation of PIA could be concluded by mid-year, but the government now admits that this timeline is unfeasible.
The government now says the end of 2025 is a more likely date. The schedule for the yet-to-be-released expressions-of-interest campaign has potential buyers doing due diligence during July and a bid evaluation period running through September. As with the first failed sale effort, the government is looking to sell between 51% and 100% of PIA and hand over management control of the carrier.
