There are two main actors at fault here: PIA itself and the Civil Aviation Authority (CAA), which is supposed to regulate the airline. One huge mistake PIA made was to contract only one company to buy all its spare parts when it would have been better to keep multiple vendors close to the international locations where PIA operates. This way, fewer flights would be delayed for technical reasons as spare parts could be more easily obtained. In the long run, PIA has to get itself on a sound financial footing. That means taking on the unions and downsizing the staff. The unions also cannot be allowed to stop sensible deals like the one that would have allowed Turkish Airways to take over some of PIA’s routes. By spending so much on unneeded staff, PIA is cutting corners when it comes to safety and is unable to make a dent in its Rs100 billion debt.
Safety will only improve once the CAA starts doing its job. Regulatory oversight in the country is weak, mainly because the CAA is staffed with many ex-PIA employees. An undeniable conflict of interest exists when employees of PIA go on to work for the very agency that is supposed to monitor the airline. The CAA must be unafraid to ground the airline’s fleet if safety concerns call for it. Under the current revolving-door policy, that is unlikely to happen. That means that PIA must be trusted to get its own house in order, something that is unlikely to happen on its own given the decades of mismanagement that led to this point.
Published in The Express Tribune, December 20th, 2011.
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Meekal and Abbas both good suggestions. The corporation cannot carry on as it is and take more money from tax payers. It is time that it is offloaded as a burden from the national treasury. Not just this corporaton but many other ones such as the railways.
Is ther any chapter 11 in pakistan then do it u know it happend in the world like yesterday SAAB car company files too for bankcrupcy. and in united states in 2008 all bank system got bankcrrupt so its happend.
@Meekal Ahmed:
PIA is still a corporation and should consider bankruptcy as an option. A little more than a billion Dollars in debt for an airline with 39 aircraft and a number of other assets, sounds very much like a rescheduling of debt alongside privatization as a necessary course of action. But in the interim before an entrepreneural invester, or investors that can salvage the maximum of this unusual financial situation comes forward, the stewardship of the airline should be handed over to an experienced hand, someone who has the necessary background to take the corporation thru the process of bankruptcy while continuing to operate in a reorganized form, and definately not one of those Babu bureaucrats that abound. Last year Japan Air lines went thru a bankruptcy of 25.6 Billion Dollars and managed to reschedule its debts.
Good Editorial.
We don't believe in "conflict of interest". Everything goes.
PIA needs to be privatized. The government should talk to someone like Mr Mansha and ask him to make a bid. Others should be invited as well -- from Pakistan and abroad.