2023-09-11 16:22:23
Pakistan’s state-owned Pakistan International Airlines (PIA) has also suspended more flights following the financial crisis. PIA has limited funds to operate only for the next few months. PIA officials said that core operations and other assets will be put up for sale. The Pakistan Aviation Ministry has warned the interim government that PIA is in dire financial straits.
Pakistani newspaper Dawn also reported that PIA owes huge amounts to creditors, aircraft lessors, fuel suppliers, insurers, international and domestic airport operators and the International Air Transport Association (IATA). Out of the 13 leased aircraft, PIA also stopped the service of five. It is also expected that the service of four more flights will be stopped. The aviation ministry has informed the government that Boeing and Airbus are set to stop the supply of spare parts by mid-September.
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The aviation ministry has requested the government to ensure funding worth Rs 23 billion while suspending duties, taxes and service charges for domestic agencies, the paper added. But the aviation ministry has not presented a practical plan to support its proposal, the report pointed out. But the ministry said it would take months to get the sector back to normal and it was vital to keep airlines operational during these times. 92% stake in PIA is held by the Government of Pakistan.
PIA has debt liabilities of Rs 745 billion, more than five times the value of PIA’s total assets, according to a Dawn newspaper report, according to the Pakistan Aviation Ministry. If the situation continues, PIA’s debt and liabilities will rise to Rs 1,977 billion and annual losses will rise to Rs 259 billion by 2030, the aviation ministry warned. Pakistan’s flights have been seized by Saudi Arabia for non-payment of dues. The Saudi Arabian Airports Authority has informed PIA that the outstanding amount of 8.2 million riyals should be paid. Last June, Pakistan’s plane was also seized in Malaysia for non-payment of dues.
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