Islamabad: The government has officially launched the privatisation process for Pakistan International Airlines (PIA), inviting expressions of interest (EOIs) from local and international investors for a majority stake in the national carrier. The Privatisation Commission announced that the plan includes selling between 51% and 100% of PIA’s shares, along with transferring management control to the successful bidder. Investors have until June 3 to submit their EOIs.
As part of its effort to attract potential buyers, the government has introduced several incentives. These include exemption from the 18% general sales tax (GST) on the purchase or lease of new aircraft, as well as protection and coverage for specific tax and legal issues. The government has also offered to transfer certain liabilities listed on PIA’s balance sheet, making the deal more attractive for investors.
This privatisation initiative is part of the government’s broader economic reform agenda aimed at reducing the financial burden of state-owned enterprises while stimulating foreign and domestic investment, particularly in Pakistan’s aviation sector. The move follows PIA’s recent achievement of posting its first annual profit in over 20 years, which has added momentum to the government’s plans.
The government’s renewed attempt to privatise PIA comes after a failed attempt last year when only one bid was received, and it fell far below the government’s minimum expectation of $300 million. To address concerns raised during that process, the government has since moved nearly all of PIA’s legacy debt onto its own balance sheet, improving the airline’s financial outlook for prospective buyers.
Prime Minister’s adviser on privatisation, Muhammad Ali, confirmed that all previous obstacles have now been cleared, and the sale of PIA is being treated as a high-priority transaction. The government has set a target of completing the privatisation process by the end of 2025.
In addition to PIA, the government is exploring the privatisation of other state-owned enterprises, including power distribution companies, and is considering strategic options for PIA’s Roosevelt Hotel in New York. The hotel could either be sold outright or redeveloped through a joint venture with a top-tier developer, potentially unlocking five times greater value. This renewed push for privatisation reflects the government’s commitment to curbing losses from state-owned enterprises and attracting investment across key sectors to boost economic growth.
Samra Zulfiqar, a real estate analyst at Zameen.com, is passionate about finding projects that offer buyers the best returns. Her keen insights spotlight the market’s most promising opportunities.
