KARACHI: Pakistan International Airlines (PIA) has taken significant steps to resume its flight operations in Karachi partially. This move followed the disbursement of fuel payments amounting to Rs100 million to the Pakistan State Oil (PSO), as reported by sources.
The national flag carrier initiated this reactivation by making fuel payments for eight international flights, with a substantial payment of Rs70 million to PSO occurring recently. In a related development, the cash-strapped PIA has received approval from the caretaker government to secure an additional loan of Rs20 billion from commercial banks, according to sources from the finance ministry.
PIA has been on the brink of shutdown due to fuel shortages, causing the cancellation of over 500 flights within the past 11 days. To address this crisis, the finance ministry has instructed commercial banks to provide fresh loans to PIA. Furthermore, the existing government debt is set to be rescheduled for a period of six months.
This financial support is expected to come from institutions such including the National Bank of Pakistan, the Bank of Punjab, and six other commercial banks, all guaranteed by the government. PIA had previously acquired a loan worth Rs260 billion from commercial banks, and this latest loan is slated to be rescheduled for six months, aligning with the intended privatization of the national entity.
The national flag carrier faces one of the most challenging crises in its history, exacerbated by Pakistan State Oil’s decision to cut off fuel supplies due to unpaid dues, which has resulted in the cancellation of 537 flights since October 13.