In a significant move aimed at restructuring Pakistan International Airlines (PIA) ahead of its privatization, the federal government is planning to create two separate entities within the airline framework, ARY News reported on Tuesday, citing sources.
Sources close to the development revealed the federal government has announced plans to create two separate entities of national flag carrier – will be known as PIA Aviation and PIA Holding Companies – ahead of privatization of the airline.
Sources revealed that the federal government intends to clear all outstanding debts owed by PIA before proceeding with the privatization process.
READ: PIA privatisation plan approved by BoD
Local loans currently burdening the airline will be transferred to the holding company, providing a clearer financial landscape for potential investors.
The federal government has taken proactive steps to secure foreign loans, signaling a commitment to revitalizing the national carrier.
Sources indicate that preparations are underway to devise a new strategy for managing approximately $88 million in foreign loans, demonstrating a concerted effort to inject much-needed capital into the airline’s operations.
However, the government is hesitant to pursue the restructuring of existing foreign loans, preferring instead to focus on negotiating new interest rates for the next 10 years.
