THE turnaround of PIA is nothing short of remarkable.
After 21 long years of mounting financial losses, the airline has emerged from its darkest days to post a net profit of 26.2 billion rupees in 2024.
This achievement is a testament to the effectiveness of the reforms initiated by the government, proving that with the right measures, even the most troubled enterprises can reclaim their place in the market.
For two decades, PIA struggled under the weight of financial mismanagement, mounting debt and operational inefficiencies.
The airline’s financial losses were so severe that it relied on regular government bailouts just to stay afloat.
However, with the recent reforms, including significant reductions in workforce and the stabilization of profitable routes, PIA has not only steadied its financial ship but is now sailing towards profitability.
Achieving an operational profit of 9.3 billion rupees and a net profit of 26.2 billion rupees is no small feat but speak volumes about the hard work and dedication that have gone into reviving PIA.
This remarkable recovery should not be viewed in isolation but as a broader reflection of the positive impact that well-executed reforms can have on state-owned enterprises.
As PIA moves forward with its plans for privatization, this newfound profitability will be a critical asset.
The government’s efforts to remove 75% of the airline’s debt from its balance sheet have made PIA an attractive proposition for potential buyers.
After years of uncertainty, the airline is now in a position to fetch a fair price in the privatization process.
Previous attempts to sell the airline had fallen short due to its financial instability, but with its improved financial health, there is renewed optimism in the market.
Companies that were once hesitant to engage in the bidding process are now expressing greater confidence, signalling that the airline could finally attract the right buyer at the right price.
The success of PIA should also serve as a broader lesson for other state-owned enterprises.
The process of privatization should not be rushed, nor should national assets be sold off at a throwaway price.
The government’s efforts to bring PIA to profitability demonstrate that a focused and strategic approach to restructuring can unlock significant value.
As the government to privatize other state-owned companies, the same principles should apply: only after these enterprises have been restructured and made profitable should they be sold.
