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SC directed PIA to calculate losses suffered during last decade

13 April, 2018

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ISLAMABAD: The Supreme Court on Thursday directed the federal government not to privatise the Pakistan International Airlines (PIA) without its prior permission. A three-member Supreme Court bench comprising Chief Justice Mian Saqib Nisar, Justice Umer Ata Bandial and Justice Ijazul Ahsan ordered this while hearing a suo-motu case pertaining to PIA’s proposed privatisation.

The court directed the PIA management to submit a formula to calculate the exact losses suffered by the national carrier during the last decade.

The court barred PIA’s all managing directors who served from 2008 to 2018 from leaving the country without its (court) prior permission, however, declined to place their names on the Exit Control List (ECL). They have also been directed to ensure their appearance at every hearing of the matter.

The court hinted to form a judicial commission to inquire into the PIA’s alleged privatisation and ascertain reasons behind accumulation of losses to it. The court appointed Dr Farrukh Saleem, an economic expert and columnist, as amicus curiae (friend of the court) to get his assistance over the issue and asked him to make terms of reference (ToRs) for the inquiry into alleged privatisation and the losses etc.

In his brief submissions, Dr Saleem told the court that the airline earned a profit of over Rs 1 billion in 2002, however, matters went down afterwards. “For how long taxpayers will continue to bail out the airline,” the chief justice regretted, adding that a permanent solution to the issue was a must.

The court also directed to submit a list of all chairmen, advisors, and managing directors of PIA, who have been working for last one decade. The federal government has been directed to submit a reply on the issue of proposed privatization of the national carrier. Attorney general was also asked to appear on next hearing and present the government’s point of view over the entire issue right from the mismanagement to the privatisation.

The court directed the counsel for PIA to submit a report on the deficit suffered by PIA during the last nine years, and to separately state the deficit of each year and highlight who the managing director of the airline was during that year.

Appearing on notice, attorney general Ashtar Ausaf Ali, stated that the government presently had no plans to privatise the national carrier. He clarified that PIA had not sold its share of air routes to any other airlines.

During the hearing, the chief justice inquired who was responsible for Rs 360 billion losses to the national carrier, adding that the court would know the cause of the losses and viewpoint of PIA’s employees on the issue.

He said those who have destroyed the national asset were enemies, oppressors and traitors.

At the onset of hearing, the counsel for PIA, presented a nine-year audit record of the national carrier. To a court query, he said presently PIA’s share was being sold at Rs 5 in the stock market. He stated that the airline has suffered a loss of Rs360.39 billion during the last 17 years. He said the government owns 96 per cent stakes in the airline.

Giving breakup of the losses, the counsel stated that the airline suffered a loss of Rs 44 billion in 2013, Rs 37 billion in 2014, Rs 32 billion in 2015, Rs 45 billion in 2016 and Rs 44 billion in 2017.

Meanwhile, the court also dismissed a petition contending that only influential candidates were provided opportunities for internships in the PIA. The court rejected the petition ruling that there was no any law available on the internships. The present government had earlier attempted to privatize part of the PIA, including its management, but the plans were put on the backburner after opposition from other political parties and the airline’s staff.

According to a Reuters report, PIA was among 68 state-owned companies earmarked for privatization in return for a $ 6.7 billion International Monetary Fund package that helped the government stave off a default in 2013, when it came to power.

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