Raise in paid-up capital under NAP: Asif-led panel to mull over relief for Jet Green

ISLAMABAD: The Federal Cabinet has constituted a Ministerial Committee headed by Minister for Aviation Khawaja Asif to consider a proposed one-year relaxation for M/s Jet Green (Pvt.) Ltd regarding the National Aviation Policy (NAP) to raise its paid-up capital, informed sources told Business Recorder.

The Aviation Division reported that the Federal Cabinet approved the National Aviation Policy on August 9, 2023. Key features of the policy include conditions for issuing new Regular Public Transport Licences (RPT). Specifically, Clause 3.1.2.1 requires a paid-up capital of Rs. 300 million at the time of application, which must increase to Rs. 600 million before the issuance of the RPT License. The policy contains no provisions for relaxing these requirements or for issuing a license without compliance.

M/s Jet Green (Pvt) Ltd, registered with the SECP, applied for an RPT license, intending to operate flights to various destinations, including Islamabad, Gilgit, Chitral, Skardu, D.G. Khan, Karachi, Lahore, Quetta, Bahawalpur, Rahim Yar Khan, Peshawar, Multan, Gwadar, and Sukkur, using ATR-72 aircraft. The company’s business plan aligns with NAP-2023 requirements, and its documentation was evaluated and approved by the Pakistan Civil Aviation Authority (PCAA).

Khawaja Asif explains govt approach to passage of amendment

However, the company’s paid-up capital was Rs. 379,424,977 as of June 30, 2023, which does not meet the Rs. 600 million requirement. Therefore, the company has requested a two-year extension to meet this condition.

The Aviation Division further stated that this matter was discussed during the 10th meeting of the Executive Committee of the Strategic Investment Facilitation Council (SIFC) on June 26, 2024. The SIFC directed that the CAA obtain an undertaking from M/s Jet Green to raise the remaining Rs. 200 million within one year, at which point the RPT license would be issued. The company has submitted the required undertaking.

Under Clause 6.6 of NAP-2023, the Federal Cabinet is empowered to grant such relaxations. In light of this, the Aviation Division requested approval for one of the following proposals:

(i) amend the National Aviation Policy 2023 to allow all applicants one year after the issuance of their RPT license to raise their paid-up capital from Rs. 300 million to Rs. 600 million, or

(ii) grant M/s Jet Green a one-time relaxation to raise its paid-up capital to Rs. 600 million within one year of receiving the RPT license, as per the SIFC’s decision.

The Cabinet reviewed the summary dated October 18, 2024, regarding the issuance of the RPT license to M/s Jet Green (Pvt) Ltd. It established a Cabinet Committee under rule 17(3) of the Rules of Business, 1973, with the following composition:

(i) Minister for Aviation (Convener),

(ii) Minister for Commerce (Member),

(iii) Minister for Communications (Member), (iv) Minister for Finance and Revenue (Member),

(v) a representative from the Pakistan Civil Aviation Authority,

(vi) Secretary of the Aviation Division, and

(vii) any co-opted members.

The Committee is tasked with reviewing all aspects of the proposal and submitting its report within two weeks for Cabinet consideration. This report will include recommendations on whether to grant M/s Jet Green a one-time relaxation to raise its paid-up capital to Rs. 600 million within one year of issuing the RPT license, and whether such a relaxation should also apply to all RPT license applicants.

Copyright Business Recorder, 2024