Pakistan International Airlines (PIA) has initiated the process of hiring a reputable international consultancy firm with extensive aviation consulting experience to prepare a five-tear corporate business plan, sources said.
The objective is to make PIA a leading international airline that is sustainable, profitable and plays an important role in the economy. A number of consultancy firms have shown interest in the bidding process completed last month, sources said.
An official said if non-core staff from engineering, catering and ground handling crew were separated from core employees, the ratio of workers per aircraft would decrease to 135, which would be similar to what is in India. PIA has been suffering from overstaffing and employs 13,500 regular employees, 3,500 daily wagers and the ratio of workers per aircraft stands at 450, Senate Standing Committee on Aviation was informed last month.
The management of PIA has stopped direct flights operations on loss-making routes - New York and Kuwait - and started flights on eight new routes. Currently, PIA is operating on 18 international routes including the UK, Italy, France, Spain, Norway, Denmark, Saudi Arabia, Oman, the United Arab Emirates, Iraq, Qatar, China, Malaysia, India, Afghanistan, Bangladesh, Thailand and Canada.
The losses have been aggravated by a fuel price hike and rupee depreciation of more than 20 percent within a year, the official said.
The previous government's attempt to privatise the national carrier stalled in 2016 after staff protests disrupted operations and parliament passed a law that effectively made privatization possible.
The PTI government is yet to decide whether to place PIA on its active privatisation list with financial losses rising to Rs 425 billion since 2008.
A senior member of the Privatisation Commission told Business Recorder that the government has no plans to privatise PIA in near future and an improvement plan is being prepared to make the national carrier 'stand on its feet.'
Currently, PIA is under the administrative control of the Aviation Division, which indicates an attempt to delist it from entities to be privatised, as under privatisation law if an entity is to be privatised then it has to be placed under the administrative control of the Privatisation Commission, an official of the Commission said.
The privatisation of PIA was approved to be delisted from the active list by Cabinet Committee on Privatisation (CCoP) on October 30, 2018 and at the same time the strategic sale of PIA Roosevelt Hotel, New York, and Scribe Hotel, Paris, within the next three years was approved.
The official maintained that PIA has to pay up to Rs 2 billion markup per month on loans; and added that PIA is working towards partly returning payables to Civil Aviation Authority, Federal Board of Revenue and Pakistan Stock Exchange, etc.
Copyright Business Recorder, 2019
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