Friday, March 29, 2024
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Pakistan Grapples with Pilot Exodus over Pay Cuts as Govt Outsources Key Airports


A Pakistan International Airlines (PIA) passenger plane arrives at the Benazir International airport in Islamabad, Pakistan (Image: Reuters)

A Pakistan International Airlines (PIA) passenger plane arrives at the Benazir International airport in Islamabad, Pakistan (Image: Reuters)

Pakistan’s move to outsource its airports comes as several pilots have left the country

The Pakistan government announced that it will outsource operations and land assets at three major airports through a public-private partnership in a bid to generate forex reserves.

The finance ministry of Pakistan allowed the Economic Coordination Committee to hire the International Finance Corporation (IFC), the private sector branch of the World Bank Group, as the transaction advisor for outsourcing Karachi, Lahore, and Islamabad airports to the private sector for a minimum of 25 years.

The Pakistan government is hoping that this move will attract private investors and enhance commercial activities, ultimately increasing revenue potential.

“The outsourcing of three airports has been initiated within the scope of public-private partnership … to engage private investor/airport operator through a competitive and transparent process to run the airports, develop appertaining land assets and enhance avenues for commercial activities and to garner full revenue potential,” the ministry said, according to a statement accessed by Pakistan-based news agency the Dawn.

The report by Dawn also pointed out that only IFC agreed to offer advisory service and reached the agreement for transaction adviser early March for a fee of $4 million.

The report pointed out that the outsourcing was done to find an operator from the private sector through a competitive process. It said the government wants these operators to run the airports, develop land assets and enhance commercial activities to maximise revenue potential.

Some parties from West Asia have shown interest in taking over the airports.

Meanwhile, a separate report by the Dawn said several pilots have left the country due to major pay cuts handed down to them in the form of pay cuts.

Pakistan International Airlines (PIA) CEO Amir Hayat informed the Senate Standing Committee on Aviation that a significant number of pilots have left Pakistan.

Hayat also pointed out that the Pakistan Supreme Court order directing hiring young male staff for the national flag carrier is yet to be implemented.

The issue was raised when Civil Aviation Authority (CAA) listed in front the Senate committee the reasons behind the decline of routes of foreign airlines.

The report said that PIA also owes the CAA 150 billion Pakistani rupees.

(with inputs from Shalinder Wangu)

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