Saturday December 09, 2023

Reviving PIA

March 16, 2018

For decades, PIA successfully competed with world-class airlines. However, the national flag carrier is, regrettably, losing its reputation day by day, both on the national and international levels. Negative reports regarding the airline are being unearthed every day.

Once the only route to the US favoured by regional countries, including China, PIA is currently limiting its flight operations to 29 international and 21 domestic routes.

In a previous column on the PIA crisis, I had emphasised the importance of restructuring the national flag carrier. According to a news report, PIA provides as many as 18,000 direct jobs and 50,000 indirect employment opportunities. Furthermore, livelihood of families of hundreds of PIA workers is associated with its operations.

However, only blaming PIA’s employees for its downfall is not right. In fact, anybody hired in accordance with the due HR procedures is innocent. The real culprit is the one who compromised on the recruitment standards to facilitate the entry of incompetent staff. To get rid of such unwanted workforce, PIA has to introduce beneficiary schemes like the ‘golden handshake’. The PIA workers’ strikes will also need to be addressed.

It is interesting to note that some former employees of PIA have played a remarkable role in making Middle-Eastern airlines a success today. In the past, the airline not only provided professional human resource but also trained employees of other airlines. Ironically, today these foreign airlines are interested in buying a stake in the troubled PIA. We need to honestly analyse what went wrong from our side, and what kinds of policies are the new airlines adopting to capture the market.

Many suggestions are under discussion for the betterment of PIA. Some elements are of the view that privatisation can save the national carrier from a complete disaster. According to my knowledge, the government holds 94 percent of the airline’s shares, while four percent belong to other state institutions and the remaining two percent are owned by private investors. Those who favour privatisation are basically demanding to float further 43 percent shares in the market.

PIA is the identity of our country and must be protected at any cost. Due to the current crisis, the market value of PIA’s share cannot be higher than Rs5. Hence, it would not be wise to sell its shares at such a low price. Another question that comes to mind is that if a private businessman is able to elevate PIA’s woes, then why has the government not been able to do so with the kinds of resources it has?

If PIA is privatised, there will be many layoffs and the liabilities would continue to stay in place. Moreover, Pakistan will lose direct connectivity without and within the country. In my view, the national airline’s suffering will neither end if it continues to operate as a national institute, nor will privatising it do any good in the absence of a dynamic leadership, committed workers and, most importantly, sincere policies.

Today, PIA is incurring huge losses because of a heavy liability worth around Rs218 billion. This debt was granted with the consent of previous regimes. Thus, the government needs to pay off all the liabilities. The operations and the current management of the airline must not be affected due to this unwanted liability. Similarly, PIA also needs to adopt solid measures to enhance its professional efficiency in accordance with the latest market trends.

Allowing foreign airlines to operate under the ‘open skies policy’ is what has damaged PIA’s business matters. Even in developed countries national airlines are protesting against foreign airlines.

We also need to review our aviation policy on a priority basis. The air fares of foreign airlines must be at least 30 percent more expensive than PIA’s. In this way, not only will we be able to increase our tax revenue, but we will also be able to increase the number of passengers. According to an estimate, the ratio of domestic and foreign passengers who fly PIA is 70 and 25 percent. Annually a total of 5.7 million passengers fly through PIA. The airline needs to attract more passengers.

Privatisation is not a sustainable solution for PIA’s crisis. The government must announce a clear policy about the restructuring of the national airline. There is also a need for legislation to discourage the practice of inducting political workers in national institutions. We must not forget that PIA is our national asset and it must be saved at any cost.

Although difficult, it is not an impossible task.

To make PIA a commercial institute generating a profit of one billion instead of a loss, within one year, we would have to ensure that its higher management and operations remain stable – without any political interference.

The writer is a member of the National Assembly and patron-in-chief of the Pakistan Hindu Council.

Twitter: @RVankwani