Pakistan International Airlines’ troubles have continued as the airline was not able to come up with funds to pay for its jet fuel needs, forcing it to cut flights, according to local media reports by Dawn.
The report added that the airline is close to completely shutting down, with more than 300 flights being canceled in the past 10 days, as confirmed by the carrier’s spokesperson.
The news follows reports that the airline, also known as PIA, has been unable to pay for fuel as recently as last week. PIA’s spokesperson confirmed that between October 16 and October 17, 2023, the airline canceled 48 international and domestic services. A Pakistan State Oil spokesperson confirmed that the de facto flag carrier had a credit limit of US$53.5 million & US$53.34 million was already used up.
As of October 16, 2023, PIA owed PSO US$95.6 million.
Earlier this month, a body under Pakistan’s cabinet used emergency powers to hire financial advisers to plan the privatization of Pakistan International Airlines (PIA) within the next four months.
The government made the decision as PIA racks up staggering losses US$550 million in 2023 alone. PIA has made losses of US$7.1 billion since 2012.
With the government low on funds and scrambling to put out economic fires, Pakistan is under pressure from the International Monetary Fund to restructure loss-making state-owned enterprises like PIA under a $3 billion standby loan arrangement, Nikkei Asia reported.