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PIA Faces Steep Rs12 Billion Monthly Deficit Amidst Financial Strain

Pakistan International Airlines (PIA) is grappling with significant financial distress as its monthly losses have skyrocketed to Rs 12 billion. The weight of these losses is felt heavily on the shoulders of an organization that once represented the nation's pride.

According to PIA's spokesperson Abdullah Khan, PIA owes commercial banks a staggering Rs 260 billion. This considerable amount has led to the airline paying over Rs8 billion monthly interest. While PIA's monthly revenue stands at Rs22 billion, its monthly outgoings amount to Rs34 billion, widening the deficit and pushing the airline's total debt to Rs 740 billion.

The strain of these debts has created additional tensions. Documents reveal that the airline has been deferring payments to several government bodies. It owes Rs1.25 billion in tax to the Federal Board of Revenue (FBR) and has unpaid dues of over Rs1 billion per month to the Civil Aviation Authority.

Amidst the escalating financial crisis, the Finance Ministry has declined further support. The ministry will not cover more interest or losses on PIA's burgeoning debt. Such a move has left the national carrier in a precarious situation.

In light of the deepening financial woes, the caretaker finance minister has approached the Privatization Division and PIA's management for a potential solution. A proposal for the immediate privatization of the national airline is now on the table, highlighting the urgency of PIA's financial situation.

Rumours about the airline's potential closure had been swirling, causing panic and worry among the public and PIA's workforce. To address these concerns, PIA's spokesperson stated on Friday. Refuting the rumours, the spokesperson said, "Speculation over the national airline's shutdown, driven by certain portions of an official statement, is baseless." The spokesperson emphasized that the projected date of September 15 for closure had unjustly damaged PIA's reputation.

It's crucial to recognize that, despite the challenges, PIA's administration has proactively sought solutions. They have made significant efforts to secure funds to address urgent financial needs, ensuring timely payment of employee salaries. PIA has secured short-term loans worth billions of rupees as a testament to their dedication.

Recent financial supports include a loan of Rs13 billion from the National Bank, with six to twelve months of repayment. Additionally, Askari Bank has authorized a loan between Rs7 and Rs10 billion. These financial arrangements indicate PIA's commitment to finding a way out of the dilemma and ensuring its continued operations for the people of Pakistan.

The unfolding situation at PIA is a stark reminder of national institutions' challenges. It underscores the importance of sound financial management and the need for effective strategies to navigate turbulent times.

 

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