ISLAMABAD: The Ministry of Defence told the National Assembly that Pakistan International Airline Company Limited (PIACL) has not received any bailout package amounting to Rs24 billion from the government. Instead, the airline obtained this amount as Bridge Financing Facilities (in tranches) from the Pakistan Civil Aviation Authority (PCAA).
In a written reply to a question from Dr Sharmila Faruqui, Defence Minister Khawaja Muhammad Asif stated that these facilities were essential to ensure the continuity of operations due to severe cash flow constraints. He stated that as part of the ongoing debt restructuring process, Rs17 billion were transferred to PIAHCL, while the remaining Rs7 billion remain with PIACL and is still payable. This information can be independently verified through the financial statements of both PIACL and PIAHCL; therefore, the assertion that PIACL was granted a bailout package is incorrect.
The accumulated losses of approximately PKR720 billion are attributable to a combination of factors, including operational inefficiencies, limitations in fleet modernisation, rising fuel costs and persistent structural challenges within the aviation sector. They have been further compounded by fluctuating market demand and global disruptions in the aviation industry. The airline remains committed to implementing comprehensive reform and restructuring initiatives aimed at improving its financial sustainability and operational performance.
The written reply stated that government support focused mainly on covering operational losses rather than fleet modernisation and heavy taxes on aircraft acquisitions and spare parts further restricted capacity. As a result, less than half of PIA’s fleet remained operational, limiting both domestic and international expansion while competitors grew rapidly.
