News Analysis |
The National Assembly was told on 24th January that the Pakistan International Airlines has shut down its Islamabad-New York flights after it could no longer bear with the Rs. 1.2 billion annual operational losses on the route.
During the question and answer session, the minister in charge of the Aviation Division Raja Mohammad Javed Ikhlas said in a written reply that flights to the US had been closed in November last year in line with the aviation industry’s practice.
He said the PIA had been rationalizing its route network from time to time, closing loss-making routes and introducing additional flights on viable routes.
To add to the national carrier’s woes, as many as six new private airlines have applied for regular public transport (RPT) licence to Civil Aviation Authority (CAA) and are likely to start their flight operations during the first half of this year.
He informed the house that over the past five years, PIA shut down eight routes, including Pakistan-US-Pakistan, Pakistan-Barcelona-Pakistan, Pakistan-Bradford-Pakistan, Pakistan-Hong Kong-Bangkok-Pakistan and Pakistan-Amsterdam-Frankfurt-Pakistan, after incurring heavy losses.
In another reply, the Aviation Division stated that PIA suffered Rs. 4,538bn losses till December 31st, 2016. The 2017 accounts will be declared after their finalization. According to the Aviation Division, some of the reasons for heavy losses were high fuel prices of over $100 per barrel in 2013-14, shortage of aircraft, navigation and other expenses and increase in salary of PIA employees.
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The lawmakers disapproved of the practice of offering free tickets to PIA staff after denying seats to revenue passengers and closing certain domestic routes. They also criticized the national flag carrier for selling Airbus A310 to a museum in Germany in violation of Public Procurement Regulatory Authority rules and PIA’s internal procedures.
Thereafter, there was an attempt to sell that aircraft to a museum in Leipzig, Germany during 2016, while bypassing the formalities like Public Procurement Regulatory Authority (PPRA) rules and PIA internal procedures.
Raja Ikhlas avoided the questions concerning accountability of PIA officials involved in the sale of A310. “The German CEO, Bernd Hildenbrand, was removed after an inquiry and the Federal Investigation Agency is probing the matter to fix responsibility on other officials involved. A Senate committee has also been investigating to get to the bottom of the issue,” he informed.
Pakistan International Airlines (PIA) has added 18 aircraft to its fleet in the last four years, said Cabinet Secretariat Parliamentary Secretary Raja Javed Ikhlas, adding that no purchase has been made due to financial constraints faced by the national flag carrier.
During the question hour, the Minister told the National Assembly that PIA might look to acquire aircraft once its financial situation improves.
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The airline’s accumulated losses have surpassed Rs. 319 billion with the carrier incurring a loss of over Rs. 11 billion in the January-March period alone. Ikhlas said that PIA currently has 37 aircraft in its fleet, compared to 19 in 2013 when the PML-N government came to power. The minister also said that the lease agreement of four aircraft will end on January 31st and the Civil Aviation Authority (CAA) has floated a tender to acquire more planes on dry and wet lease.
He informed the committee that one PIA aircraft, an A310, has been grounded in Germany. After obtaining a waiver from the CAA, the non-fly worthy grounded aircraft was rented to a film company based in London to shoot a film in Malta.
In response to a question, he said the free and concessional tickets given to PIA employees have no monetary value as all the tickets are subject to availability of load. A ticket to a PIACL employee is only confirmed when a vacant seat is available on a particular flight.
He also shed light on the quality of new aircraft that are to be procured.
“The quality and standard of a new aircraft is assessed by a team of representatives, belonging to technical departments of PIA. However, the aircraft can operate only after the technical clearance of the CAA,” he said.
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He informed the committee that one PIA aircraft, an A310, has been grounded in Germany. After obtaining a waiver from the CAA, the non-fly worthy grounded aircraft was rented to a film company based in London to shoot a film in Malta. Thereafter, there was an attempt to sell that aircraft to a museum in Leipzig, Germany during 2016, while bypassing the formalities like Public Procurement Regulatory Authority (PPRA) rules and PIA internal procedures.
The lawmakers disapproved of the practice of offering free tickets to PIA staff after denying seats to revenue passengers and closing certain domestic routes.
To add to the national carrier’s woes, as many as six new private airlines have applied for regular public transport (RPT) licence to Civil Aviation Authority (CAA) and are likely to start their flight operations during the first half of this year.
These airlines are Liberty Air owned by Ch Munir and Mian Amir, Go Green Airways, Elahi Group, Danish Elahi and Arshad Jalil, Askari Air Pakistan, Army Welfare Trust (AWT), United Airways Pakistan Limited by Adnan Tabbni, Air Sial, combined owner, Sialkot Chamber of Commerce, and Afeef Zara Airways owned by Rashid Siddiqui. Of these airlines, Air SiaI, Askari of Army Welfare Trust, Go Green, revival of Bhoja under the new name, and Afeef Zara are likely to launch air operations no later than October.