KARACHI: The International Monetary Fund (IMF) has officially welcomed the privatisation of Pakistan International Airlines (PIA), describing the sale as a landmark achievement in the country’s broader effort to reduce state involvement in commercial sectors.
In a statement provided to ‘Arab News’ on Saturday, Mahir Binici, the IMF’s resident representative in Pakistan, noted that the successful transfer of the national carrier to private ownership fulfils a primary commitment under the $7 billion Extended Fund Facility (EFF).
Binici characterised the divestment as a milestone within the authorities’ reform agenda, aimed at attracting private investments to foster long-term economic growth.
The endorsement follows the landmark sale of a 75 per cent stake in PIA to a consortium led by the Arif Habib Group. The deal, valued at Rs135 billion ($486 million), concluded last month following a competitive bidding process. This second attempt at privatisation succeeded where a previous effort a year ago failed, largely due to improved operational conditions -- including the recent lifting of EU and UK flight bans that was imposed after the airline’s deadly Airbus A320 crash in Karachi in 2020 that killed 97 people -- which significantly enhanced the airline’s market value and appeal to private investors.
The IMF’s supportive remarks come as recent government data highlights the mounting financial strain caused by underperforming state entities. According to the Cabinet Committee on State-Owned Enterprises, Pakistan’s SOEs recorded a staggering net loss of Rs122.9 billion ($442 million) during the 2024-25 fiscal year. This figure represents a nearly 300 per cent increase from the Rs30.6 billion net loss reported in the previous year.
While the privatisation process remains a politically sensitive issue -- drawing criticism over potential job losses -- supporters and international lenders argue that private sector management is essential for improving efficiency and service delivery, ‘Arab News’ reported.
