Investors Seek Extension in PIA Bidding, Tax Relief And More

The Senate Standing Committee on Privatization held a detailed discussion on the privatization of Pakistan International Airlines (PIA). Officials from the Privatization Commission confirmed that the bidding process for PIA is scheduled for October 31 only pending federal cabinet approval. Investors have requested an extension in bidding and a revision of several terms, including tax breaks, a reduction in the number of employees, and clarity on PIA’s liabilities. They also raised concerns about PIA’s Rs. 200 billion debt, its employee pensions, and the condition of its fleet. Bidders are also seeking a 76 percent stake against the original 60 percent offered by the federal government. Officials said the government will ensure that employee salaries and pension liabilities are protected, and it expects the new administration to retain the employees. The panel was briefed that bidders also sought legal protection against old lawsuits. Participants urged settling matters related to PIA’s assets and employees before proceeding with privatization. The committee also discussed the privatization of power distribution companies (DISCOs). Power Division officials said the process of hiring a financial advisor for DISCOs would begin soon. The committee briefly revisited the privatization of K-Electric, with officials acknowledging that the company had not met its investment obligations. They said that this time, only DISCOs’ distribution services would be privatized, while generation and transmission services would remain under federal government control.