The Civil Aviation Authority (CAA) has formally requested the Pakistan International Airlines (PIA) to return unused properties and offices, citing potential cost reduction for the national carrier. In a letter, CAA officials directed PIA's management to promptly hand back such assets, aiming to alleviate monthly rent expenses.
To comply with the directive, the PIA general manager has instructed all airline departments to provide details of unused buildings and land by December 15. The CAA director general has already informed the aviation ministry about the initiative to reclaim properties from the PIA.
Earlier in March, the CAA director general informed a Senate committee that the PIA owed a cumulative sum of Rs150 billion for properties leased at a nominal cost. He highlighted that lease agreements for these properties had not been revisited for an extended period.
Amid restructuring, the interim government divided the CAA, establishing a separate Pakistan Airport Authority (PAA) following a parliamentary decision. The authorities now operate under distinct directors general, with details of employees and assets being allocated accordingly.
Read Govt bifurcates Civil Aviation Authority
The notification delineated that licensing, flight standards, air transport, airworthiness, and regulatory departments remain under the CAA. Simultaneously, commercial servicing, air traffic control, vigilance, air navigation, monitoring, renovation, and communication departments of commercial airports fall under the purview of the PAA.
While the interim government seeks to privatize the PIA, no success has been achieved thus far. Caretaker Privatization Minister Fawad Hasan Fawad indicated progress, stating that the government was expected to sign a financial advisory service agreement with the Ernst and Young-led consortium. Although the consortium's hiring was approved, the agreement signing is pending and expected to be finalized in the upcoming week.
Once the agreement is signed, the adviser will require six to nine weeks to structure the privatization transaction and an additional 20 to 26 weeks for PIA balance sheet restructuring. Despite a technical committee's efforts to prepare a PIA debt restructuring plan and arrange Rs15 billion in loans, no success has been achieved in the past month.
(With input from our correspondent in Islamabad)
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