Bankrupt PIA vital to Pak transport sector
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The four-day strike held by staff at Pakistan International Airlines (PIA) earlier this month brought many issues to light.
It served to show that the airline is badly organised and inefficient, but also that it is a vital service provider in the country’s transport sector.
It could however, quite easily be replaced by foreign carriers as many passengers were left scrambling for tickets on alternative flights after the PIA fleet was grounded.
The company’s saving grace here is the policy protection it is afforded by the government. As national carrier, the airline holds monopoly on many domestic routes which protects the ailing business from more efficient and more competitive operators.
In reality, the airline is utterly bankrupt. According to a report by The Tribune, PIA is “less than worthless”.
The business has not turned a profit for five years and investigation into company financial statements show that its liabilities exceed its assets value by INR58 crore.
While this is largely down to mismanagement, corruption fuelled policy blunders have served to heighten crisis levels as the government permitted foreign airlines to operate in Pakistani airspace without demanding reciprocal access for PIA.
Observers say that the management must be restructured and allowed to operate without political interference if the airline is to turn things around.
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