KARACHI: The privatization plan of Pakistan International Airlines (PIA) for the upcoming year has faced setbacks, as the privatization commission couldn’t resolve issues related to loan repayments and legal matters.

Sources close to the development stated that the interim federal minister for privatization, Fawad Hussain Fawad, failed to implement the plan to transfer PIA to the private sector by January 2024.

The Ministry of Finance will decide to meet the financial requirements of PIA for the next 3 months, while PIA has borrowed more than Rs 270 billion from commercial banks on government guarantee.

Sources suggest that PIA cannot afford to pay more than Rs. 8 billion in interest on the Rs. 260 billion loan. The commercial banks involved in lending to PIA include the National Bank and Bank of Punjab, along with eight other commercial banks.

The decision to reschedule government loans until the privatization of PIA could not be finalized. The Ministry of Finance will establish a committee to decide on the financial requirements of PIA.