pakistan national carrier expands flight operations as credit line extended
Published on: October 30, 2023.
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Pakistan International Airlines (PIA) has announced that it will be able to resume more flights in the coming days, thanks to a credit facility extension from the state oil company. The extension will allow PIA to fund its fuel purchases, which had previously been disrupted, leading to the cancellation of 349 domestic and international flights since October 15.
In a statement, PIA expressed optimism about the restoration of its operations, stating that it has already scheduled 45 flights for today. The airline expects its flight operations to return to normal in the next few days as the fuel supply improves.
This news comes as a relief for PIA, which has been facing significant financial challenges. The airline has accumulated billions of dollars in losses and liabilities, and the caretaker government has made it clear that it can no longer provide funding. PIA has also been embroiled in a dispute with the Pakistan State Oil company (PSO) over outstanding payments.
However, in a move to support the national carrier, the PSO announced on Monday that it has extended a credit facility of 500 million rupees ($1.82 million) to PIA. The PSO also revealed that PIA’s outstanding balance with the company stands at 26.8 billion rupees ($97.37 million).
Earlier this month, the PSO had suspended the credit facility, leading PIA to make daily payments of 100 million rupees for fuel purchases. With the extension of the credit facility, PIA can now rely on funding from the PSO to continue its operations without interruption.
The financial troubles faced by PIA are a part of a larger plan by Pakistan to bring fiscal discipline, as agreed upon under an International Monetary Fund (IMF) bailout. As part of this plan, the government has announced its intention to privatize the airline.
PIA has been in crisis for quite some time. In 2020, the airline’s flights to Europe and the UK were suspended after the European Union’s Aviation Safety Agency revoked its authorization to fly to the bloc. This was a consequence of a scandal regarding pilot licenses.
In conclusion, PIA’s recent agreement with the PSO for the extension of a credit facility will enable the airline to resume more flights and overcome the disruptions in its operations caused by fuel supply issues. The ongoing fuel supply improvements are expected to restore PIA’s flight operations to normal in the coming days. This is a positive development for PIA, which has been facing significant financial challenges and is in the process of being privatized. However, the airline still has hurdles to overcome, such as the suspension of flights to Europe and the UK due to the pilot license scandal.
Source: [Zawya](https://www.zawya.com)
