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A Pakistani newspaper has exposed PIA's systematic under-use of their two Combi Boeing 747s, which is indicative of the reasons why PIA is in a perpetual state of crisis. The airline seems to prefer taking aircraft on lease, on the slightest of pretext. The newspaper correspondent has estimated the cost of under-utilisation of PIA's freighter cum passenger version 747s, to have been a loss of Rs 669 million. The airline has taken on lease a freighter from MNG, at a fabulous cost. No open tenders were advertised for getting the best option, even if this deal is to be justified.
PIA has now taken three Boeing 747-100s and 200 series aircraft on lease for Haj, whilst its own fleet of 747-200s is grounded. It seems the Haj/Umra operation comes unannounced every year, so as to justify procurement of these aircraft on lease, without invitation of open tenders, a standard practice in aviation industry. When standard procedures are waived as a matter of habit, the allegations and doubts of non-transparency and kick-backs are natural. In the last two decades, no management of PIA has ever followed normal procedures that would ensure transparency of deals, whether they be aircrafts on lease or outright purchase.
In any case the exorbitant expenditure incurred, cannot be justified given the fact that PIA has an extensive maintenance infrastructure and a fleet of aircraft, of the same vintage that it has taken on lease, lying idle on ground. PIA has a corporate and fleet planning division, whose task it is to plan a fleet which suits its revenue earning route structure, passenger profile, and is economically viable, in the sense that lease/purchase installments can be paid from revenue generated by these aircraft. Unfortunately all such deals made during the last 20 years have been more beneficial to individuals involved than the airline. Aircraft taken on lease have always been on terms and conditions, which are far more than those that prevail in the industry.
Similar is the situation with credit financing arranged from international financial banks through third parties.
It baffles the imagination that when CFOs of AOL, ENRON, Parmalett etc can be proceeded against and face criminal charges, why cannot the same be done to those who have robbed PIA of billions of rupees. Perhaps the government does not want to set a precedent, so that those within its fold and involved in financial irregularities, may meet the same fate one day. PIA has made a mess of its recent Umra operation, yet no senior executive involved has been taken to task, except two junior staffers. The controversy surrounding the over-expensive Boeing 777s, A-310s and defective seats installed on these aircraft is still fresh, and yet PIA's mafia has the audacity to embark on another un-explainable deal, which lacks transparency. The mere departure of a controversial DMD, in a top-heavy incompetent and corrupt management, is not enough to silence the critics.
The man has been let off with a clean bill of health, and shall live his life in luxury, in some foreign country, of which he must already be an immigrant or have a residential staus.
How convenient it is. The Federal Government, National Assembly and the Senate must take Suo Moto notice of these irregularities and so should the Supreme Court of Pakistan.

Copyright Business Recorder, 2004

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