PIA privatisation launched: EOIs sought by June 3

ISLAMABAD: The government has formally launched the privatisation process of Pakistan International Airlines (PIA), inviting expressions of interest (EOIs) from local and international investors for a majority stake in the national carrier.

According to the Privatisation Commission, the plan involves selling between 51% and 100% of PIA’s shares, along with transferring management control to the successful bidder. Interested investors have until June 3 to submit their EOIs.

To encourage participation, the government has also announced a range of incentives. These include exemption from the 18% general sales tax (GST) on the purchase or lease of new aircraft.

Additionally, protection and coverage will be provided in certain tax and legal cases, the commission stated.

The move also involves the transfer of specific liabilities listed on PIA’s balance sheet, aimed at making the offer more attractive to potential buyers.

This privatisation effort is a central component of the government’s broader economic reform agenda, as it seeks to ease the financial burden of state-owned enterprises while attracting foreign and local investment into the aviation sector.

The privatisation push comes on the heels of PIA posting its first annual profit in over 20 years, a milestone that has added momentum to the government’s plans. Last week, the government stated it would issue the call for EOIs, following approval from the Privatisation Commission Board.

This marks the second attempt in recent years to privatise PIA. The previous effort last year failed, with only one bid received, and that too, far below the government’s minimum expectation of $300 million.

In response to concerns raised during the earlier attempt, the government has since moved nearly all of PIA’s legacy debt onto its own balance sheet, thereby, improving the airline’s financial outlook for prospective buyers.

Muhammad Ali, the prime minister’s adviser on privatisation, recently stated that all previous roadblocks have now been addressed. He confirmed that PIA’s sale is being treated as a high-priority transaction, with a target of completing the process within 2025.

As part of its broader economic reform programme, and in line with the $7 billion International Monetary Fund (IMF) bailout conditions, the government also plans to privatise power distribution companies and explore strategic options for PIA’s Roosevelt Hotel in New York.

The property could either be sold outright or redeveloped via a joint venture with a top-tier developer, potentially unlocking five times greater value, Ali said.

This renewed privatisation push reflects the government’s commitment to curbing losses from state-owned enterprises and attracting both domestic and foreign investment across key sectors.