The federal government has reportedly made a number of major decisions regarding the national carrier Pakistan International Airline (PIA), including moving its head office from Karachi to Islamabad and handing over the management control of newly-constructed Islamabad Airport to PIA. These decisions have surprised many.
As reported in the media, a high-level meeting chaired by Prime Minister Imran Khan in January also decided to appoint eight serving forces’ officers in the PIA, with four each from the Pakistan Army and Pakistan Air Force for a three-year tenure.
Although uniformed personnel from the forces have been working in the national carrier from time to time in the past and during the last five years, about 22 officers from PAF were appointed in PIA and repatriated, the Minister In-charge for Aviation Division Muhammad Mian Soomro told the Senate in a reply during question hour. However, the manner the position of Chief Executive Officer is advertised in the print media has also raised eyebrows of the legislators as the qualification of the CEO in PIA also included having experience of war operations and other defence disciplines. They said the ad was designed to provide benefit to a certain person. In the Senate, former Senate chairman Mian Raza Rabbani alleged that the ad to fill the post of CEO of the commercial airlines was tailor-made for the incumbent CEO, Air Marshal Arshad Malik, who is currently serving as an acting CEO.
The interesting aspect of these recent decisions of the federal government was, as the official sources stated, that representatives from the aviation division including Director General of Civil Aviation Authority (CAA) were not present during the meeting which decided to hand over Islamabad Airport to PIA. This has also raised questions about viability and efficiency of the CAA, which is managing almost all the airports in Pakistan. CAA even issues regular public transport (RPT) licences to airlines. Recently, it has issued RPT licences to two new airlines Air Sial and Askari Air Pakistan and the process to issue two more licences to Liberty Air and Afeefzara Airways is underway.
These major decisions about PIA coincided with the federal cabinet’s decision to impose the Pakistan Essential Services (Maintenance) Act, 1952 on all categories of the PIA’s employees, which virtually bans the trade union activities in a state-owned organisation and any violation would cost the employees heavily. The trade unions leaders have decried this decision and termed it violation of the Constitution’s Article No 17 (Freedom of Association) which provides citizens the fundamental right to join any associations or trade unions according to their choice.
“Workers have been resisting in the past and they would challenge the recent decision in the courts,” said Shaikh Majeed, a former leader of the PIA trade union.
This is not the first time this restrictive law is imposed on the employees of PIA. It was earlier imposed in February 2016 and July 2018 when the workers protested against privatisation of the national carrier. The staff fear that this time it is imposed to curb any resistance to the government decision to move the head office to Islamabad. A number of employees will have to move their residences from Karachi to Islamabad as the head office is being shifted to the federal capital. All these decisions would be effective from July this year, media reports said.
Sindh Assembly has reacted sharply to the shifting of PIA head office to Islamabad. The assembly passed a resolution, moved by Pakistan People’s Party member Nida Khuhro and supported by almost all political parties in the provincial assembly, against the move to shift the PIA head office.
“It is yet another biased action by the federal government that goes against Sindh,” said Ms Khuhro, the mover of the resolution in Sindh Assembly, adding that such actions would increase the sense of deprivation among the people of Sindh. “A number of employees will have to move their families and residences.”
The most surprising decision was handing over the country’s largest Islamabad Airport to PIA. Usually airports are managed by the civil aviation authorities in a country and here CAA is manning all the airports. No reason was given for this decision. Although no official version is available about the recent decisions regarding PIA, newspaper reports in this regard have not been denied by the federal government.
Former prime minister, Shahid Khaqan Abbasi, had inaugurated the largest and most modern Islamabad Airport on May 1, 2018, which was completed at a revised cost of Rs105 billion. The airport has a capacity to handle 15 million passengers annually and its capacity may be increased to 25 million passengers.
“It seems the government is trying to make PIA viable before its formal privatisation and this may be the reason of handing over of Islamabad Airport to PIA,” says senior economist Muzammil Islam.
Talking to TNS, he said many airlines like Emirates are also running its own airports in Dubai, but this move is also surprising for him as well. Regarding moving of PIA’s head office to Islamabad, Islam said, “Apparently, the government is making PIA financially sound and having its head office in the federal capital is meant for swift decisions and actions.”
The federal government had earlier dropped PIA from the privatisation list of the public-sector entities. However, it may be placed in the list again with these restricting measures. The government is also in advanced stage of negotiation with the International Monetary Fund (IMF) for a restructuring loan and one of the conditions of IMF may be privatisation of the loss-making entities.
The national flag-carrier, in recent months, has tried several measures to make it commercially viable. These steps include revival of several suspended routes, closure of loss-making routes, induction of new aircraft and inclusion of executive economy class.
Aviation Minister Mian Soomro informed Senate that PIA is in a process of finalising its ‘Strategic Business Plan 2019-22’, which would be submitted to the federal government in March or April this year for approval. The plan included measures to improve the airline’s performance with opening up several profitable routes like Silakot-Sharjah, Lahore-Muscat, Islamabad-Doha and Lahore-Bangkok-Kuala Lumpur, as these routes are economically viable.
Moreover, Soomro also said the government has not provided any bailout package to PIA, rather additional guarantees of Rs17.022 billion have been approved by the government and PIA would borrow from banks against these additional guarantees.