PIA revival plan to be finalised by March

Syed Irfan Raza Published February 7, 2019

The bloated national carrier, with around 507 employees per plane, has seen an increase of around 230pc in accumulated losses to Rs414bn during the last eight years.

ISLAMABAD: Prime Minister Imran Khan on Wednesday said the privatisation of Pakistan International Airlines (PIA) was not in the manifesto of Pakistan Tehreek-i-Insaf government.

“Privatisation of the national flag carrier is not in the manifesto of the PTI government and therefore it has initiated a reform process to overcome losses being incurred by the airline,” he said at a meeting held to discuss PIA and its revival.

The prime minister stressed that the reason behind reforms in PIA was to save the national flag carrier from consistent losses and make it a profitable entity.

The meeting was attended by Minister of Finance Asad Umar, Federal Minister for Aviation Mohammad Mian Soomro and PIA Chief Executive Officer retired air marshal Arshad Mehmood.

On the occasion, the PIA CEO briefed the prime minister on the entity’s reform plan and the new aviation policy.

He revealed that a comprehensive business plan for the PIA will be presented by the end of March.

PM Khan urged the authorities concerned to keep the nation abreast with the measures being taken for revival of crippling national flag carrier.

Not only the PIA, the government has withdrawn its plan of privatisation of “sick” units and decided to revive, 195 ‘sick’ state enterprises.

The meeting was informed that under the strategy to deal with sick government units, the cabinet on November 16 approved formation of Sarmaya-i-Pakistan Company — which will work on Singaporean and Malaysian models — to decide the fate of sick entities. PM Khan will lead the SPC board of governors while seven experts from the private sectors will share their inputs on PIA, Pakistan Steel Mills and Pakistan Railways.

In a meeting held on January 1, the prime minister was apprised that PIA losses had crossed Rs414 billion mark. PM Khan had directed the PIA chairman to devise a comprehensive business plan to overcome losses.

The prime minister was informed that the total losses of PIA were Rs414.3bn and the organisation was facing a deficit of Rs500 million on seven international routes in addition to loss on domestic routes.

It was also brought into knowledge of the prime minister that 194 PIA staffers, including seven captains, 73 cabin crew members and other officials were sent home during an ongoing drive against employees appointed on bogus educational certificates.

Published in Dawn, February 7th, 2019

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Comments (24) Closed

Pervez

Feb 07, 2019 08:52am

Revival? That is a joke!

Recommend 0

Khan

Feb 07, 2019 09:14am

Finally the competent person Arshad Mehmood is in charge. No doubt this airline will become profitable again.

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Asad

Feb 07, 2019 09:18am

Reviving PIA is akin to bringing dead to life. Good luck nevertheless.

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Yousuf47 London

Feb 07, 2019 09:37am

The losses are quite substantial and any half hearted attempt will not be successful. The only way forward is for Government to appoint a first class firm of Chartered Accountants so a creditors meeting may be called. The purpose would be to seek a write off of 70% of the debt with 30% of the debt payable over three years after a moratorium of 12 months. It should be properly monitored with creditors kept informed of progress. PIA is no longer viable so it is either a complete shutdown or the last chance to come out off intensive care so major surgery is undertaken. There is no quick fix and creditors cooperation is essential for it to succeed.

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zia

Feb 07, 2019 09:45am

If the government has not the guts to privatize PIA for political reasons then the only other solution is to declare this failed institution bankrupt. The losses suffered by all sick units are now unbearable for country's feeble economy. It is now time to stop pouring our hard earned money in this sinkhole.

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Hashim

Feb 07, 2019 09:56am

PIA can be revived. And the government must do the same with Pakistan Steel Mills. It seems that Railways is on the right path now with freight trains. They just need to lay down more tracks so that they can cater to more trains, both passenger and freight, and also increase the speed of the trains. Laying down new tracks will also help revive Pakistan Steel. We just need good intentions and a passion for our country, and things can be done

Recommend 0

Jehengir khan

Feb 07, 2019 10:11am

You keep doing the same thing again and again and expect different result....its called insanity..PIA underwent natural death....no need to be sentimental....just sell it to a private party if anyone is interested....

Recommend 0

SkyHawk

Feb 07, 2019 10:26am

The problem is that PIA has no business plan. It is still run like non-business entity and personal airline of Sharif and Zardari mafia.

Recommend 0

Analyst

Feb 07, 2019 10:26am

Oh Really?

Recommend 0

Hasnain Bokharee

Feb 07, 2019 10:44am

Set up a new budget airline as a Subsidiary of PIA, sell or transfer all the short haul planes and their subsequent leases to this new entity and rebrand all the aircrafts. This new airline will only fly domestically and perhaps gulf region. New employment contracts for existing staff (if they get moved into the new subsidiary airline). If they resist, not to sign up, hire new fresh blood. For PIA, the airline will ‘only’ operate on lucrative routes as the nations carrier or cargo services. This way the PIA brand will be able to compete with other major airlines on a level playing field, lesser wear and tear of existing fleet, punctuality, reliabiliy & comfort will be emphasised. Example: Malaysian airline is the flag carrier but ‘Malindo airlines’ is the budget carrier of Malaysia. Stop pick/drop off to staff entirely (you can provide free parking at the airport), introduce meals to be purchased inflight for budget carriers & cancel all arrangements with pricey hotels for staff

Recommend 0

Feb 07, 2019 11:04am

Let the Air Force personnel address the administrative issues to wipe off politics from PIA and create credible discipline but please hire a CEO from the international market with experience and successful track record in the airlines business to grow profitable sales revenue.

Recommend 0

Pakistani

Feb 07, 2019 01:33pm

It is the lack of taking tough decision(s) which is the main reason for the decline of PIA.

Recommend 0

M. Emad

Feb 07, 2019 02:19pm

Mega-loss making 'PIA revival plan to be finalised by March'.

Recommend 0

Parvez

Feb 07, 2019 02:20pm

Einstein said ...... doing the same thing repeatedly and expecting a different result is insanity. PIA is dead put it to rest and start afresh. It will be economically better, legally easier and the chances of the new set up functioning profitably would be much better.....but the will to do the right thing must be there otherwise it will will be PIA all over again.

Recommend 0

khan

Feb 07, 2019 02:43pm

if you need to privatize distribute shares among locals

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sophie

Feb 07, 2019 02:49pm

Why not just admit that we can't privatize PIA because it has no value and NOBODY wants to buy it? Shut down PIA - sell off the valuable real estate and pay down some of the enormous debt owed to Pakistan taxpayers. The demand for air travel can be met by private airlines (foreign and domestic). We have enormous economic challenges and don't need to be bogged down trying to resuscitate this worthless airline.

Recommend 0

Hassan Shabbir

Feb 07, 2019 02:53pm

'to be finalized'? what a joke. This airline has been bleeding taxpayers money since ages and there has been no plan in place. Just dump the airline.

Recommend 0

shahid

Feb 07, 2019 03:17pm

Being a Pakistani living in Europe for decades and having a vast experience of management and marketing, I would suggest a few things to Mr. Arshad Mehmood: (1) To bring back the customer, he needs to ensure them an uncompromising maintenance setup specially by employing foreigners on supervisory positions of the department and the workshops. Today, Pakistani diaspora widely avoid PIA even if they have to spend few extra hours with middle eastern airlines mainly due to safety concerns and lack of trust in corrupt and irresponsible Pakistani work force. (2) International flights arriving in Lahore Karachi and Islamabad should fly further to a secondary city as the end station. This will counter Qatar and Emirate which fly direct to destinations deep in the country.

Recommend 0

Ali

Feb 07, 2019 07:52pm

PIA was the top airline in the world which helped create Emirates airline in 1985, by providing aircraft, pilots, cabin crew and management. PIA's downfall started with political meddling by PPP and PML government as thousands of political workers were given jobs, when they were 'not' needed. They must be sacked. Previous governments also gave out 300,000 "free" PIA tickets to politicians and government officials every year, that must end. PIA can regain its profitability and past glory by bold reforms and run professionally, not politically. PIA can again become "Great People To Fly With".

Recommend 0

Hasan Mirza London

Feb 07, 2019 10:33pm

Mr. Raza PIA bankruptcy is not solution, the suggestion are all political appointees on top to bottom are to be fired, Sport department to be closed all players are terminated, sell PIA in private sector, major shareholders are control by Govt. let see this formula. Do not give ticket to MNA and MPA on credit all on cash, similarly to Govt employees, this way cash flow will increase, A senator, brothers and relative approx 12 Staffs, brothers, cousin, are fired immediately , All political appointees = must resigned without any benefit, this senator is illegally occupying Ministerial enclave, this way PIA will save Billions of Rupees.

Recommend 0

Shahzad

Feb 07, 2019 11:38pm

Get professional management from overseas. Become member of star alliance. Don’t let ministry of aviation / bureaucrats interfere in its affairs. They all want to remain in control of the organisation for their monetary gain. PM should strictly declare hands off from these vested interests. You will see the change.

Recommend 0

Omar

Feb 07, 2019 11:50pm

No govt. anywhere in the world is known to run any organization with efficiency, profitability and sustained excellence. pakistan is is no exception, actually it has the worst attributes of any govt. run entity worldwide due to nepotism, corruption.

Recommend 0

nfw

Feb 09, 2019 07:27am

@Pervez, Concur.

Recommend 0

nfw

Feb 09, 2019 07:29am

Of course there is no corruption, nepotism, bureaucracy or the like at PIA. A few years ago I was given the choice between PIA and Thai. Let me just say Bangkok was great.

Recommend 0

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