ISLAMABAD: The Supreme Court of Pakistan (SC) has lifted its stay order on the privatisation of Pakistan International Airlines (PIA), enabling the government to proceed with the long-delayed process. The Constitutional Bench, headed by Justice Amin-ud-Din Khan, dismissed the case, emphasizing the need for transparency in the privatisation process.
During the hearing, the Additional Attorney General informed the court about the government’s approval to hire professionals for PIA and confirmed that flight operations were no longer restricted. Justice Jamal Mandokhail underscored the importance of keeping the court informed to ensure compliance with judicial directives.
The privatisation of PIA has faced multiple obstacles, including a lack of cooperation between government departments, unresolved tax liabilities, and a failed transaction structure. Privatisation Minister Abdul Aleem Khan previously criticised the Ministry of Finance and the caretaker government for leaving PIA with a Rs45 billion negative equity, complicating the sale.
Bidders, including a real estate developer, had offered Rs10 billion against a reserve price of Rs85.03 billion, a stark gap attributed to PIA’s financial woes. Requests for exemptions, such as an 18% sales tax waiver on leased aircraft and liability write-offs, were denied by the Federal Board of Revenue (FBR) due to concerns over Pakistan’s commitments under the IMF programme.
The government now faces the challenge of securing credible buyers for PIA under improved terms. Justice Khan expressed optimism that the airline might fetch better rates in the current market but reiterated the importance of a transparent process.
With the Supreme Court’s dismissal of the case, the government has a renewed opportunity to restructure and privatise PIA, a step seen as crucial for addressing the airline’s mounting debts and operational inefficiencies.
