ISLAMABAD: The process for the privatization of the national airline PIA is now fully prepared for a second attempt, with several returning bidders and stakeholders participating in the process.
A meeting of the National Assembly’s Standing Committee on Privatization was held under the chairmanship of Farooq Sattar, during which it was informed that, in the previous round, bidders had recommended the exemption of the 18% GST imposed by the government on the inclusion of new aircraft and the expansion of the fleet. They believed that removing this tax would facilitate the acquisition of new aircraft.
The committee was informed that PIA’s liabilities amount to 45 billion rupees, including 26 billion rupees in tax liabilities owed to the FBR, 10 billion rupees owed to the Civil Aviation Authority, and the remaining amount is related to pension liabilities.
The IMF agreed that if PIA’s privatization takes place, the 18% GST could be waived to encourage private sector investment in new aircraft.
Further, the committee was told that non-core assets are not part of PIA’s bidding process. The government is developing a separate policy for these assets, and consultants have suggested two to three options to the Cabinet Committee on Privatization.
