PIA - Pakistan International Airlines (PK, Islamabad International) has been granted a PKR17.02 billion rupee (USD126.9 million) government bailout in the form of sovereign bank guarantees and other measures, Arab News has reported.
The package includes PKR10 billion rupees (USD75 million) in bank guarantees, which would allow the airline to borrow from banks on commercial terms.
The bailout, the second in just six months, is aimed at helping to restore the flag carrier's profitability ahead of the possible privatisation. The new Imran Khan government has recently decided that 195 state-owned entities, earlier tentatively earmarked for sale to private investors, will not be privatised until their financial situation improves.
The government will also create a new body tasked with the oversight of the ailing state-owned firms.
"Prime Minister Imran Khan will be the head of the board of governors (BoG) of the company which will decide the fate of sick entities, including the Pakistan International Airlines (PIA), Pakistan Steel Mills, and Pakistan Railways," Information Minister Fawad Chaudhry was reported as saying by Dawn.
PIA itself, which the previous government hoped to sell this year, has amassed USD3.3 billion in debt as of July 2018, including USD125 million due for immediate repayment to foreign lenders.
