The last time the government moved on privatisation spurred on by the conditions attached to a $6.7 billion IMF package it quickly ran into problems with the unions and in 2016 chaos ensued. In the end, the government backed down and passed laws that in effect rendered the sale of PIA impossible. Those laws are now going to have to be reversed through the National Assembly and the Senate between now and July or August. The unions are going to be no more malleable this time around than they were the last time.
What is being proposed is a break-up of PIA with the core business — flying aeroplanes — to be ring-fenced as a separate entity to the peripherals such as catering, hotels and maintenance. These will presumably continue to operate in the government ownership. The minister said that he would be taking his plans to the cabinet committee on privatisation possibly in the next week. Now this might be admirably hasty given the generally sluggish pace of governance and there may be potential buyers for the new entity — Etihad and Emirates had both expressed an interest in the past — but whether the government has the stomach or the stamina to go head-to-head with the unions is a very open question; and there are commentators and analysts that think not. We maintain an open mind. Privatisation is the obvious route to fly, but whether the bird can be persuaded into the air with aerodynamically challenging injuries remains to be seen.
Published in The Express Tribune, January 16th, 2018.
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