The privatisation of Pakistan International Airlines (PIA) has been delayed once again, with the government now targeting the last quarter of 2025 to complete the process. This postponement means the government will miss its fiscal year target and the July 2025 deadline set by the International Monetary Fund (IMF) as part of a $7 billion bailout program.
The initial attempt to privatise PIA in October 2024 failed due to limited bidder interest, with only one offer received. Concerns over legacy debt and taxation issues contributed to the lack of competitive bids. In response, the government has addressed these concerns by relieving PIA of approximately 80% of its legacy debt and implementing cost-cutting measures, including staff reductions and withdrawal from unprofitable routes.
Despite these efforts, the privatisation process has faced multiple delays. The final auction, initially scheduled for October 1, 2024, was postponed to October 30, 2024, due to low bidder interest and unresolved issues. Subsequent plans to seek fresh expressions of interest by the end of April 2025 aim to attract more competitive offers, with the government intending to privatise a 51-100% stake in PIA.
While PIA has reported its first annual profit in over two decades, with a net profit of PKR 26.2 billion for FY 2024, the privatisation process remains behind schedule. The government has also missed deadlines to privatise other state-owned enterprises, such as the House Building Finance Company and First Women Bank, raising concerns over the overall privatisation strategy.
The government is now working on a revised roadmap to make PIA’s privatisation more attractive to investors, with plans to complete all stages of the process within the next three months. However, given the repeated delays and missed targets, stakeholders remain cautious about the timeline’s feasibility.
