ISLAMABAD: In what could mark Pakistan's first major privatization in nearly two decades, Pakistan International Airlines (PIA) is set for a crucial bidding process on Tuesday, with the entire auction broadcast live on national television to ensure transparency.
Prime Minister Shehbaz Sharif originally announced the decision during a high-level meeting with business leaders and representatives from pre-qualified bidding consortia earlier this month, according to the Prime Minister's Office.
The sale is seen as a key test of Pakistan’s broader economic reform agenda, as the government seeks to cut losses from state-owned enterprises and revive investor confidence.
Islamabad has launched a five-year privatization plan covering 24 state entities between 2024 and 2029, including the Roosevelt Hotel in New York, three banks, power distribution companies, and the Postal Life Insurance Company, the Privatisation Commission of Pakistan confirmed.
With the exit of Fauji Fertiliser Company Ltd, three parties remain in contention: Lucky Cement group, Arif Habib Corporation, and private carrier Airblue.
Privatization of loss-making state firms has long been urged by the International Monetary Fund (IMF), as the country seeks to address fiscal and external financing challenges. The PIA sale is a key requirement under the country's $7 billion IMF bailout program agreed in September.
Privatization Adviser Muhammad Ali said the government plans a full divestment of the airline, beginning with the auction of a 75% stake on Tuesday, with the remaining 25% to be offered later at a 12% premium.
Signs of recovery and future plans
The airline has shown recent improvement. PIA reported its first annual profit in 21 years for fiscal year 2024, earning an operational profit of $13.7 million. The European Union lifted its four-year flight ban in November 2024; PIA resumed service to Paris in January 2025 and restarted flights to the UK in October 2025.
This marks Pakistan's third attempt at privatization, following a failed 2024 auction that received only one bid of $35 million — far below the government's $298 million floor price, according to Privatisation Commission records.
Under the new business plan, PIA's fleet is expected to expand from 18 to 38 aircraft by 2029, with service to over 40 cities.
The government is targeting $302 million in privatization proceeds this year, though Ali said restoring PIA’s operations remains the priority over maximizing short-term revenue.
