KHALEEQ KIANI
ISLAMABAD: The government on Wednesday allowed another bailout package for the troubled national airline.
The decision was taken at a meeting of the Economic Coordination Committee of the cabinet presided over by Finance Minister Ishaq Dar.
According to an official statement, the meeting approved a request for increasing the government’s guarantee limit for the Pakistan International Airlines Corporation Limited (PIACL) by Rs10.5 billion to Rs161.5bn to address its immediate challenges. It also constituted a committee headed by Planning and Development Minister Ahsan Iqbal to prepare yet another business plan to improve the airline.
According to informed sources, the airline’s management pleaded that its fiscal challenges had multiplied after a recent plane crash (PK-661), though it had been running with liquidity crisis for many years. Continuous money injections over the past three years, it said, had improved the number of PIA planes and efficiency, but revenue could not pick up due to a reverse challenge — surplus capacity and low yields.
Urgent plane inspections after the recent crash not only further affected the operations but also the revenue flow, the management said, adding that non-payments to aircraft lessors, fuel suppliers and service at home and abroad had reached a stage where the airline might be forced to ground its fleet and cause international default such as to Saudi Arabia, Pakistan State Oil, Boeing, Air France, Bakri, Euro Control and spare parts and engineering service providers. Thus, it said, there was an urgent requirement of about Rs7bn to meet “overdue liabilities”.
On top of that, the PIA reported another requirement of Rs25bn to finance or roll over various loans guaranteed by the government before June 30 this year. For this all to achieve, the PIA management sought support of the government to increase its guarantee limit to Rs161.5bn from Rs151bn.
Source: DAWN
Another Bailout Package for PIA Allowed
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Re: Another Bailout Package for PIA Allowed
Maybe some of the money from this bailout package to be used by PIA for paying compensation to legal heirs of flight 661 crash victims.
Abbas
Abbas
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Re: Another Bailout Package for PIA Allowed
161 billion rup3es can be used to start a new airline. Emirates was started with 10 million $. Most of Pakistani ppl are travelling on ME carriers and all this 161 billion for what? It is the peoples money they are spending on corrupt mafia of PIA workers.
Govt should tell PIA management that this is your last bail out. After this if you are out if money, you will be out of business.
Govt should tell PIA management that this is your last bail out. After this if you are out if money, you will be out of business.
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Re: Another Bailout Package for PIA Allowed
With 25 million children out of school and hospitals in pathetic shape the government has nothing better to do then bailout an airline with no future.
PIA 2 should have been created a long time ago with the fleet, 5,000 workers and limited liability.
Rest of loans taken over by government along with the two hotels.
Sell the hotels, pay off the loans and whatever is left should be used for a gold handshake for the remaining 12,000 emplolyees.
PIA 2 should have been created a long time ago with the fleet, 5,000 workers and limited liability.
Rest of loans taken over by government along with the two hotels.
Sell the hotels, pay off the loans and whatever is left should be used for a gold handshake for the remaining 12,000 emplolyees.
P.I.A
God's International Airline
God's International Airline
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Re: Another Bailout Package for PIA Allowed
I don't understand what is the real issue of our print media. In any way, they aren't satisfied. If PIA takes loans or planned to be privatized or any such things, there are many such cartoons printed on newspapers. If something is good, it is never published!
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Re: Another Bailout Package for PIA Allowed
The problem is what these bailouts are not showing any substance the airline is still in loss, hasn't shown any growth or a significant improvement in service
And that's why the press is against such bailouts and furthermore they are against every principle of a free market
And that's why the press is against such bailouts and furthermore they are against every principle of a free market
Special Concept Livery to celebrate Pakistan's 70th year of Independence
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Re: Another Bailout Package for PIA Allowed
This habit of seeking financial bailout packages on regular basis will stop airline's management/employees from working hard for airline's survival.
The dependence on handouts must end.
Abbas
The dependence on handouts must end.
Abbas
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Re: Another Bailout Package for PIA Allowed
THE EXPRESS TRIBUNE > OPINION > EDITORIAL
PIA: time to call ‘Time’
The state and fate of the national carrier, Pakistan International Airlines (PIA), has been the subject of frequent comment in these columns over the years. Maintaining a sense of optimism regarding the future of this bloated shibboleth has proved increasingly difficult; and more than once observers have predicted that the end of the road was in sight for PIA — but it was not to be and the airline staggered from crisis to crisis. Yet again it appears that an end is in sight as the Aviation Division has revealed that the debt burden has forced the airline to the brink of default — a financial event that is notable for its lack of options future-wise other than bankruptcy.
So bad is the current crisis that PIA is eating itself alive, literally eating the duties and taxes that are collected from ticket sales or deducted from the salaries of employees — who must be perplexed at finding themselves co-opted into bailing out the sinking airline. The state of PIA has reportedly ‘annoyed’ finance minister Ishaq Dar, though the news can hardly come as a surprise to him and if it did then he does not have his eye on an important ball.
The Aviation Division is looking for Rs24.94 billion to shore up loan installments and mark-up between January and June this year. This cannot — must not — continue. The formation of yet another set of committees to ‘solve’ the myriad problems is just kicking them into the long grass, an excuse not to take hard decisions. No matter that PIA had a ‘better’ year in 2016, no matter that it is inducting two new aircraft and no matter that the management is promising better days to come — no matter all of that. It is time for the federal government to call ‘Time’ on PIA because the quack-doctoring has not worked — again. It is going to be bloody, painful and politically embarrassing but enough really is enough. Pull the plug.
Source: tribune.com.pk
PIA: time to call ‘Time’
The state and fate of the national carrier, Pakistan International Airlines (PIA), has been the subject of frequent comment in these columns over the years. Maintaining a sense of optimism regarding the future of this bloated shibboleth has proved increasingly difficult; and more than once observers have predicted that the end of the road was in sight for PIA — but it was not to be and the airline staggered from crisis to crisis. Yet again it appears that an end is in sight as the Aviation Division has revealed that the debt burden has forced the airline to the brink of default — a financial event that is notable for its lack of options future-wise other than bankruptcy.
So bad is the current crisis that PIA is eating itself alive, literally eating the duties and taxes that are collected from ticket sales or deducted from the salaries of employees — who must be perplexed at finding themselves co-opted into bailing out the sinking airline. The state of PIA has reportedly ‘annoyed’ finance minister Ishaq Dar, though the news can hardly come as a surprise to him and if it did then he does not have his eye on an important ball.
The Aviation Division is looking for Rs24.94 billion to shore up loan installments and mark-up between January and June this year. This cannot — must not — continue. The formation of yet another set of committees to ‘solve’ the myriad problems is just kicking them into the long grass, an excuse not to take hard decisions. No matter that PIA had a ‘better’ year in 2016, no matter that it is inducting two new aircraft and no matter that the management is promising better days to come — no matter all of that. It is time for the federal government to call ‘Time’ on PIA because the quack-doctoring has not worked — again. It is going to be bloody, painful and politically embarrassing but enough really is enough. Pull the plug.
Source: tribune.com.pk
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Re: Another Bailout Package for PIA Allowed
PIA 1 and PIA 2 was a good option
The government makes an airline with the fleet, 5,000 employees, and the debt related to fleet.
The rest of the debt goes to government plus the two hotels PIA owns along with 12,000 extra employees.
Rather then paying 15 billion at a time, maybe injecting 150 billion by selling the hotels will help PIA.
PIA NEEDS SURGERY NOT ANTIBIOTICS
The government makes an airline with the fleet, 5,000 employees, and the debt related to fleet.
The rest of the debt goes to government plus the two hotels PIA owns along with 12,000 extra employees.
Rather then paying 15 billion at a time, maybe injecting 150 billion by selling the hotels will help PIA.
PIA NEEDS SURGERY NOT ANTIBIOTICS
P.I.A
God's International Airline
God's International Airline