ISLAMABAD: The government is set to hand over PIA to its new owners by the end of the current month as all remaining codal formalities and documentation have been completed.
Formalities Completed Ahead of Handover
Prime Minister’s Adviser on Privatisation Muhammad Ali made the disclosure in an interview. He stated there is no hurdle left in the process. Certain issues between bidding and closing stages were resolved. These included NOCs for global contracts, aircraft loans and lease agreements. Permissions from lenders were necessary to transfer agreements to the new entity. Resolution of FBR-related issues also took considerable time and effort.
Liabilities, Legal Framework and Tax Relief Addressed
A number of liabilities are being transferred to the PIA Holding Company. This involved substantial effort from the concerned teams. The PIA Act of 1956 has been repealed except for the name retention clause. The law was approved by Parliament after initial introduction through an ordinance.
During the transition period, PIA management consults with the bidders on decisions. The consortium led by Arif Habib Corporation holds 75 per cent stake. It acquired the stake for Rs135 billion in December 2025. Fauji Fertiliser Company joined the group subsequently.
The deal structure has Rs10 billion as government equity component. Rs125 billion is committed for debt reduction and fleet modernisation. GST exemption on aircraft and spare parts has IMF approval. This ensures operations remain viable and competitive in the market.
The Privatisation Commission backs extending similar concessions to other airlines. Such extension would need separate IMF clearance going forward. The adviser confirmed the target remains firm for month-end completion.