From Khalid Mustafa
ISLAMABAD: With a view to wriggling out Pakistan International Airlines (PIA), which is experiencing huge financial crisis, the government would pay the interest of about Rs 2.6 billion which has been piled upon the various loans amounting to Rs 27 billion that national flag carrier has borrowed.
After the intervention of President General Pervez Musharraf, the government and management of PIA have made the strategy to bail out PIA which is in such dire financial straits that it may be threatened with liquidation because of its monthly losses of more than Rs 1 billion.
According to a senior official at Ministry of Finance, under the financial strategy that has been finalized to bail out PIA, which is in dire financial straits, government would pick the interest of Rs 2.6 billion of about 11 to 12 loans amounting to Rs 27 billion that PIA has borrowed.
“The interest rates are 12 loans of PIA are not unified, so as per financial strategy, we have clubbed the short term and long term loans of PIA which would help reduce the rate of interest also and government has decided to pick up the whole interest piled up on the loans to ease up the national flag carrier,†he said. He said, “During the financial restructuring, PIA would also revamp its operations under which routes would also be altered and loss making routes would be eliminated.â€ÂÂ
The official said six new Boeing 777s would replace the existing outdated fleet of Boeing 747s and those new aircraft would be purchased during the period of next five years. “The average life of 747 aircraft is 20 years and PIA is using the outdated fleet for last 20 to 23 years, therefore it needs the replacement with efficient fleet,†he said.
He said that the new blood would be injected in the workers of the organization to run it efficiently.
Under the restructuring plan, non-core assets of PIA valuing billion of rupees would be privatized that the amount to be generated out of privatization would be used for capital investment for PIA to make its financial health sound, he said. He said that under the five years restructuring plan, PIA would be profit making organization in third year of the plan.
The official said the countdown of the restructuring plan of PIA has started from January 1, 2007. However, Ministry of Finance and PIA would jointly brief the Prime Minister about the strategy within some days for formal go ahead.
Source: [url=httt://www.jang-group.com]The News[/url]
Govt to pay interest of Rs. 2.6 billion on loans of PIA
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That means the B 773ER has been chosen as the prefered aircraft to replace the B 743s.The official said six new Boeing 777s would replace the existing outdated fleet of Boeing 747s and those new aircraft would be purchased during the period of next five years. “
But why should the order for more B 773ERs be placed over a period of 5 years when it should be placed asap so that it can be delivered within 2 years time. They are complaining and whining of high gas prices and gas guzzling B 747s, so instead of cribbing more, do something about it and have the B 773ERs ordered asap before slots are lost out to other airlines.
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