PIA the test case

The Pak Banker - - FRONT PAGE -

Once again the PIA man­age­ment has se­cured the Rs17 bil­lion bailout pack­age from the gov­ern­ment. The Eco­nomic Co­or­di­na­tion Com­mit­tee's de­ci­sion is an­other dose of oxy­gen for the ail­ing na­tional flag car­rier. In ad­di­tion to Rs17 bil­lion bailout pack­age, the Fi­nance Min­istry has set aside Rs18 bil­lion to pay in­ter­ests on past loans of the PIA in this fis­cal year alone.

The to­tal li­a­bil­i­ties of the air­line have crossed the Rs400bn mark as of Au­gust this year, ac­cord­ing to the avi­a­tion sec­re­tary, and its run­ning losses each month are al­most Rs2bn. Next to these fig­ures, the Rs17bn dis­burse­ment ap­proved by the lat­est de­ci­sion of the Eco­nomic Co­or­di­na­tion Com­mit­tee is peanuts, to put it mildly.

Giv­ing the quar­terly bailout to the ail­ing air­lines is not unique but .it is sur­pris­ing that the PTI gov­ern­ment like its pre­de­ces­sor has also thrown good money with­out saeek­ing any revasmp plan from the new PIA chief. PM Im­ran has promised to re­struc­ture the loss-mak­ing en­ter­prises but now be­ing in charge of the Avi­a­tion Divi­sion has cho­sen to sign off the Rs17 bil­lion cheque with­out first ap­prov­ing a re­struc­tur­ing plan.

The PM choice Air Mar­shal Arshad Ma­lik as the CEO of the PIA is con­trary to the party's stance to ap­point pro­fes­sion­als to head the state-owned en­ter­prises. The Air Mar­shal does not have the ex­per­tise to run a com­mer­cial air­line. There is a dire need that PIA board should be re­vamped with pro­fes­sion­als hav­ing strong back­ground in the avi­a­tion in­dus­try as the bankers, re­tired bu­reau­crats and in­dus­tri­al­ists can­not re­vive the air­lines. In­stead of bailout we need a debt man­age­ment strat­egy for in­crease in rev­enues. We should end the his­tory of PIA's mount­ing losses, sky­rock­et­ing debt, and re­peated bailouts from the gov­ern­ments. The new gov­ern­ment which cam­paigned on the prom­ise of change, and the fi­nance min­is­ter has re­peat­edly been say­ing that the state-owned en­ter­prises can be turned around or­gan­i­cally, with­out any strate­gic trans­fer of share­hold­ing. In fact PIA is a test case for the gov­ern­ment. With­out a plan, and with­out ap­point­ments of peo­ple with the right ex­pe­ri­ence, whose track record in­spires con­fi­dence, the dream of turn­around will not be re­al­ized. There are re­ports that the CEO has sub­mit­ted a busi­ness plan to the Eco­nomic Co­or­di­na­tion Com­mit­tee to turn PIA around but it is also nec­es­sary that more de­tails should be shared with the think tanks and the me­dia for a wider, com­pre­hen­sive dis­cus­sion so that some­thing good may come to the fore. More­over, along with busi­ness plan PIA also needs ' plan B'. It is nec­es­sary to know and who are the peo­ple in­volved in its draft­ing? How long was it worked upon be­fore be­ing for­warded to the ECC. Tack­ling the deep-seated prob­lems of the state owned en­ter­prises is one of the big­gest chal­lenges fac­ing this gov­ern­ment and we hope that the new ad­min­is­tra­tion of the na­tional car­rier will leave no stone un­turned to make this en­ter­prise a suc­cess and the con­fi­dence of the pub­lic is re­sorted on the car­rier with a moto of ba ka­mal log and la­jwab ser­vice.

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