Pakistan International Airlines (PIA) which has previously been flying on the back of consistent government bailouts and commercial loans, has surprisingly retired debt worth Rs. 19 billion in the past year.
This was revealed in a State Bank of Pakistan (SBP) report on Tuesday. The report identifies that PIA’s domestic debt reduced to Rs. 137.7 billion by March 2020 compared to Rs. 156.9 billion in March 2019.
Commenting on the development, PIA spokesperson, Abdullah Hafeez Khan, said that the current management has been paying around Rs. 5 billion a month to retire debt and liabilities. The national flag carrier’s total debt (foreign and domestic) stood at Rs. 400 billion on June 30, 2019.
The development, however, had a minimum impact on overall liabilities. That is because the national airline gets the debt restructured and rolled over, or sometimes takes fresh loans from banks to pay off old ones to keep the airline operational.
Abdullah Hafeez said that despite going in losses, the airline has been servicing debts in the past few years.
We hit almost break-even level (no profit and no loss) from operations in the year ended December 31, 2019, Khan claimed, adding that the coronavirus restrictions have badly impacted the airline now.
At present, PIA is only running special flight operations on humanitarian grounds to fly foreigners to their home countries and bringing Pakistanis back home on the government’s directives. These are mostly one-sided empty flights, and the government bears expenses for such flights.