As the government revives efforts to privatise Pakistan International Airlines (PIA), stricter conditions have been introduced to attract only financially capable buyers. Following a failed privatisation attempt last year, officials have overhauled the bidding process with the aim of ensuring transparency, credibility, and long-term sustainability for the national carrier.
Adviser to the Prime Minister on Privatisation, Muhammad Ali, announced the updated rules during a press briefing, stating that interested parties have until June 3 to submit their Expression of Interest (EOI) for acquiring 51% to 100% shares along with management control of PIA. Notably, federal and provincial governments and their entities are now barred from participating. However, government-affiliated bodies not classified as state-owned enterprises — such as the Fauji Foundation — remain eligible.
The revised bidding conditions address concerns raised in the previous privatisation effort, where a lone real estate bidder offered just Rs10 billion against a minimum benchmark of Rs85.03 billion. Learning from that experience, the government has now set more rigorous financial criteria, including:
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Minimum net worth of Rs8 billion for lead consortium members
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Annual revenue thresholds of Rs200 billion (or $715 million) for the most recent year, or Rs100 billion (or $360 million) consistently over the last three years
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Liquidity requirements of Rs28 billion (or $100 million) in cash or liquid assets
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Mandatory audits by internationally recognised or SBP-listed chartered accountancy firms
The lead consortium member can be replaced up to two weeks before the bidding date, provided all pre-qualification standards are met — offering flexibility while maintaining compliance.
Privatisation Commission Secretary Usman Bajwa also pointed out improvements in PIA’s financial standing, including a Rs30 billion deferred tax credit adjustment that contributed to the airline’s reported profitability. The carrier, however, still operates with only 15 active aircraft and requires significant investment to expand.
To further ease the process, the government has exempted the 18% GST on the purchase or lease of aircraft for PIA, and is open to adjusting negative equity based on investor feedback. With European routes reopening and overall financial indicators stabilising, officials expect a higher reference price than last year’s failed bid.
The adviser clarified that no foreign government is currently in the running and that the sale will proceed through an international competitive bidding process. Moreover, if the interested buyer is not an airline, they must meet stringent revenue and liquidity benchmarks to qualify.
By tightening the qualification criteria, the government hopes to attract credible, financially strong bidders that can not only acquire PIA but also reinvigorate its operations in the long term.