ISLAMABAD: A damning report by the Sub-Committee of the Standing Committee on Privatization, led by Senator Sehar Kamran, has laid bare the systemic failures that have crippled Pakistan International Airlines (PIA), pushing the national carrier towards financial collapse and potential privatization. The parliamentary fact-finding committee has identified decades of political interference, failed aviation policies, financial mismanagement, and leadership instability as key factors behind PIA’s dramatic decline from holding 50% of the market share to a mere 20%.

In a post on X (formerly Twitter), Senator Sehar Kamran emphasized the critical findings of the report, stating:

“PIA’s decline linked to Gulf airlines expansion, Open Sky Policy: report. Market share of Pakistan’s flag carrier dropped from 50% to 20%; parliamentary fact-finding committee urges aviation policy reforms, leadership stability, and investigation from former Aviation Minister Chaudhry Ghulam Sarwar.”
Read the post here.

The report underscores that the 1990s Open Sky Policy, designed to boost competition, ended up being a death sentence for PIA. By granting unrestricted access to foreign airlines, particularly Gulf carriers like Emirates, Qatar Airways, and Etihad, Pakistan essentially turned itself into a feeder market while PIA struggled with outdated aircraft and dwindling government support. These state-backed Gulf airlines, benefiting from generous subsidies and modernized fleets, expanded aggressively into Pakistan, operating over 100 flights per week, while PIA was forced to scale back operations due to financial constraints and regulatory failures.

The parliamentary committee has strongly recommended a review of Pakistan’s aviation agreements, stressing that PIA’s survival depends on renegotiating terms that currently favour foreign carriers.

PIA’s Shrinking Fleet and Financial Ruin

The report paints a grim picture of PIA’s operational capacity, revealing that out of its 30 aircraft, only 19 remain operational, with six out of 12 Boeing 777s grounded due to lack of maintenance funds. PIA’s total liabilities have exceeded Rs. 740 billion, with no structured debt repayment plan in place.

Unlike its international competitors, which receive government-backed investments in modern aircraft, PIA faces punitive taxation on new aircraft procurement, making fleet modernization nearly impossible. The financial burden has forced PIA to rely on costly wet lease agreements, most notably the 2016 deal with SriLankan Airlines for an Airbus A330, which resulted in a staggering Rs. 2.88 billion loss in just six months. Similarly, the London Premier Service, intended to re-establish PIA’s UK operations, racked up a direct operating loss of Rs. 1.14 billion before being shut down in 2017.

The parliamentary report highlights these decisions as reckless financial mismanagement, further emphasizing that politically motivated leadership appointments contributed to PIA’s downward spiral.

The Pilot License Scandal: Ghulam Sarwar’s Reckless Blunder

Perhaps the most damaging self-inflicted crisis in PIA’s history was the 2020 pilot license scandal, triggered by then-Aviation Minister Chaudhry Ghulam Sarwar Khan. His public claim that 262 PIA pilots held fraudulent licenses led to a global aviation crisis, with:

• The European Union Aviation Safety Agency (EASA) banning PIA from flying to Europe.
• The UK Civil Aviation Authority (UK CAA) suspending all PIA operations.
• The US Federal Aviation Administration (FAA) downgrading Pakistan’s aviation safety rating.
• 150 PIA pilots being grounded and facing re-evaluation, causing professional and financial ruin.

The sub-committee estimates that this scandal alone cost PIA approximately $600 million in lost revenue over four years. Although EASA lifted its ban in January 2025, allowing PIA to resume flights to Paris, UK regulators remain reluctant to reinstate PIA operations, and the FAA will visit Pakistan in March 2025 to assess whether PIA can resume direct flights to the US.

Given the magnitude of the damage, the parliamentary committee has called for a full-scale inquiry into Ghulam Sarwar Khan’s statements, which single-handedly pushed Pakistan’s aviation sector into an existential crisis.

Workforce Crisis and Leadership Failures

The report also exposes PIA’s deeply flawed workforce structure, where despite laying off over 3,000 employees through the Golden Handshake Scheme, the airline still faces overstaffing concerns. With a staff-to-aircraft ratio of 215 personnel per aircraft, PIA remains far above global industry standards, draining resources that could be used for service improvements and expansion.

Adding to the crisis is the frequent turnover of PIA’s leadership. Over the past two decades, the airline has had multiple CEOs and chairpersons, many of whom were politically appointed without aviation expertise. This lack of leadership continuity resulted in inconsistent policies, failed restructuring efforts, and long-term financial mismanagement. The report strongly urges that future appointments be based on aviation experience rather than political connections.

Privatization: The Only Path Forward?

With PIA teetering on the edge of financial collapse, the government has signaled that privatization is the only viable solution. However, the Sub-Committee, under Senator Sehar Kamran, has warned that privatization alone will not fix the deep-rooted structural failures. Without serious reforms in governance, financial management, and aviation policy, privatization will merely transfer a broken system into private hands.

The parliamentary report outlines several urgent recommendations, including:

• Immediate fleet modernization through structured government-backed financial relief.
• A comprehensive review of the Open Sky Policy to ensure fair competition for PIA.
• A financial restructuring plan to address PIA’s crippling Rs. 740 billion debt burden.
• A human resource overhaul to optimize workforce management and reduce unnecessary costs.
• Ensuring leadership stability by appointing qualified aviation professionals.

The Road Ahead: Will PIA Survive?

The findings of the Sub-Committee’s report paint a bleak picture of chronic mismanagement, failed policy decisions, and leadership failures that have crippled PIA’s operational capacity and market presence. With market share plummeting, financial debts soaring, and credibility in tatters, the coming months will determine whether PIA can be salvaged or if it will be relegated to history as one of Pakistan’s greatest economic failures.

For a once-proud national carrier, the choice is clear: Either take immediate, decisive action to reform and revive PIA, or witness its collapse under the weight of its own failures.