Pakistan International Airlines (PIA) is in financial turmoil after being reportedly denied a 23 billion Pakistani Rupee (US$75 million) bailout package from the country’s government.
The publicly owned airline had already received a 15.6 billion Pakistani Rupee (US$51 million) support package back in May 2023.
The rejection of the airline’s petition adds to several woes afflicting the airline. In the first months of 2023, PIA faced multiple legal challenges from its creditors, including aircraft lessors and airport operators, and has had assets repossessed in several jurisdictions due to lack of payment.
Also, 11 of the airline’s 31 aircraft are grounded, with three in a state deemed beyond repair.
PIA’s problems also extend to its operations.
In 2020, the airline was banned from operating in the European Union (EU) and the United States (US) following a scandal concerning the fraudulent obtention of some of its pilots’ licenses. More recently, PIA has been rocked by repeated flight delays and issues with delivering passenger luggage on time.
The latter incidents earned PIA a fine from the Pakistani government.
In August 2023, the Pakistani government announced its intention to privatize the airline, which is expected to post a 112 billion Pakistani Rupee (US$365 million) loss in 2023, since it is deemed to be financially unviable in its current form.