Business

Govt trying to find Rs8bn loan guarantees for PIA

Published

1 year ago

Farwa

After flight cancellation, PIA is now announcing only those flights for which fuel has been procured.

PIA has 34 aircraft in fleet, out of which two are inoperative.
PIA’s revenue has declined to Rs300m.
Airline spox says 15 int’l flights, 7 domestic flights to depart today.

ISLAMABAD: As Pakistan International Airlines (PIA) suffers from 70% decline in revenue after the cancellation of over 600 flights, the Finance Minister has been scrambling to get Rs8 billion loan guarantees to remain within the International Monetary Fund’s (IMF) agreed limits, The News reported quoting sources.

According to the sources, the national carrier experienced a huge decline — around 60% to 70% — in its daily revenue. The airline generated around Rs700 million Rs800 million, which has now reduced to Rs300 million.

There are 34 aircraft in PIA’s fleet, out of which two planes are inoperative because of different reasons. Meanwhile, the airline also doesn’t have the finances to meet its fuel requirements. Following flight cancellation, the national air carrier is now announcing only those flights for which fuel has been procured, as it will ensure operation without any delay.

Last week, the ECC had approved a bridge financing of Rs8 billion through CAA resources that would be used for payment of $25 million liabilities owed to Malaysia for procurement of two aircraft. There was an outstanding amount of $30 million but after tough negotiations, PIA convinced them over payment of $25 million.

PIA had sought Rs24.6 billion for its operational expenses from the government of Pakistan. The Ministry of Finance had initially rejected the demand for this injection on the basis that in the past, PIA came up with financial injections with the commitment to undertake restructuring plan but it was never implemented.

The Privatisation Commission is making all-out efforts to accomplish all required procedures for going ahead with privatisation till December or January. It is yet to be seen how speedily they would be able to accomplish all the spadework and procedures without compromising the objective of transparency.

It would be an uphill task to accomplish the PIA transaction but also keep its operation intact. If it reaches to point of shutdown in its existing shape, its privatisation will not produce the desired results.

The Ministry of Finance has been working on creating a fiscal space and would provide its nod in the shape of guarantees for generating loans of Rs8 billion.

“We might be able to jack up all financial injections up to Rs15 billion but it’s too early to share precise numbers,” said one official, adding that the outcome of the ongoing exercise would be determined this week. The total guarantee limit for PIA stood at Rs262 billion, which was exhausted but later on the airline paid back its outstanding loans. So there was room available to the tune of Rs8 billion at the moment.

There is no easy solution for cash-bleeding PIA in sight but it should be privatised in a manner that it remains afloat for the next three to six months.

PIA to operate 22 flights today

Meanwhile, the PIA spokesperson said that the airline will operate 22 domestic and international flights today. However, 29 flights have also been cancelled today due to the overall situation.

Speaking with Geo News, the spokesperson said that 15 international flights and seven domestic flights will depart today.

“PIA’s flight operations are improving,” the spokesperson said.

Business

With its second-largest surge ever, PSX approaches 114,000 points.

Published

2 days ago

Farwa

Driven by renewed activity from both private and government financial institutions, the Pakistan Stock Exchange (PSX) saw its second-largest rally in history on Monday.

The market regained many important levels in a single trading session as it rose with previously unheard-of momentum.

Intraday trading saw a top increase of 4,676 points, and the PSX’s benchmark KSE-100 Index gained 4,411 points to settle at 113,924 points. This impressive rebound demonstrated significant investor confidence by reestablishing the 100,000, 111,000, 112,000, and 113,000-point levels.

The market also saw the 114,000-point limit reestablished during the trading session.

The positive tendency was reflected when the market’s heavyweight shares touched its upper circuits. Among the most busiest trading sessions in recent memory, an astounding 85.78 billion shares worth a total of Rs55 billion were exchanged.

Experts credited the spike to heightened institutional investor activity and hope for macroeconomic recovery. Considered a major market recovery, the rally demonstrated the market’s tenacity and development potential.

Business

In interbank trade, the Pakistani rupee beats the US dollar.

Published

1 week ago

Farwa

In the international exchange market, the US dollar has continued to weaken in relation to the Pakistani rupee.

The dollar fell to Rs278.10 from Rs278.17 at the beginning of interbank trading, according to currency dealers, a seven paisa loss.

In the meantime, there was a lot of turbulence in the stock market, but it recovered and moved into the positive zone. The KSE-100 index recovered momentum and reached 116,000 points after soaring 1,300 points.

Both currency and stock market swings, according to analysts, are a reflection of ongoing market adjustments and economic uncertainty.

Business

Phase II of CPEC: China-Pakistan Partnership Enters a New Era

Published

1 week ago

Farwa

The cornerstone of economic cooperation between the two brothers and all-weather friends is still the China-Pakistan Economic Corridor, the initiative’s flagship project.

In contrast to reports of a slowdown, recent events indicate a renewed vigour and strategic emphasis on pushing the second phase of CPEC, known as CPEC Phase-2, according to the Ministry of Planning, Development, and Special Initiatives.

According to the statement, this crucial stage seeks to reshape the foundation of bilateral ties via increased cooperation, cutting-edge technology transfer, and revolutionary socioeconomic initiatives.

Planning Minister Ahsan Iqbal is leading Pakistan’s participation in a number of high-profile gatherings in China, such as the 3rd Forum on China-Indian Ocean Region Development Cooperation in Kunming and the High-Level Seminar on CPEC-2 in Beijing.

His involvement demonstrates Pakistan’s commitment to reviving CPEC, resolving outstanding concerns, and developing a strong phase-2 roadmap that considers both countries’ long-term prosperity.

At the core of these interactions is China’s steadfast determination to turn CPEC into a strategic alliance that promotes development, progress, and connectivity.

Instead of being marginalised, CPEC is developing into a multifaceted framework with five main thematic corridors: the Opening-Up/Regional Connectivity Corridor, the Innovation Corridor, the Green Corridor, the Growth Corridor, and the Livelihood-Enhancing Corridor.

With the help of projects like these, the two countries will fortify their partnership, and CPEC phase-2 will become a model of global economic integration and collaboration that benefits not just China and Pakistan but the entire region.