ISLAMABAD: The Supreme Court appointed on Thursday economist-cum-analyst Dr Farrukh Saleem to formulate terms of reference for identifying causes of ever-increasing losses of the Pakistan International Airlines (PIA).
Dr Saleem will go through the audit statements of the national flag carrier and identify in two weeks reasons behind the PIA losses amounting to Rs360 billion.
Chief Justice Mian Saqib Nisar, while heading a three-judge SC bench, allowed Dr Saleem to come to his chambers if he finds any difficulty in getting relevant documents or needs any assistance.
“We want to expedite and fix responsibility for the losses,” the chief justice observed while hearing a suo motu case the court had initiated against the government decision of privatising the PIA.
He directed all managing directors of the PIA to furnish last 10 years’ audited statements of the organisation.
The apex court hinted that it might constitute a commission consisting of upright and honest individuals to look into the reasons for PIA’s bankruptcy, but only after the terms of reference were finalised.
SC bars former managing directors from leaving the country without permission
“For how long we can burden the taxpayers to bear the losses bleeding the airlines,” the chief justice observed, adding that even some improvement in PIA affairs would be marred by red tape.
The court wondered what experience current PIA adviser Sardar Mehtab had in the field of aviation.
The court took undertaking from the former managing directors not to leave the country without its permission. It, however, chose not to order placing their names on the Exit Control List, despite showing the intention of doing so.
Attorney General Ashtar Ausaf Ali assured the court that for the time being no step was being taken by the government to disinvest the PIA, adding that given the current financial health of the national flag carrier it could not be privatised.
Although the Council of Common Interests had earlier decided to sell the PIA, its shares to the tune of 51 per cent would remain under the control of the federal government, the attorney general argued.
Earlier, the federal government had approved PIA’s privatisation in a cabinet meeting which was presided over by Prime Minister Shahid Khaqan Abbasi. But the decision was opposed by the Pakistan Peoples Party.
The PIA incurred a loss of Rs36.13bn in 2008, Rs5bn in 2009, Rs20.7bn in 2010, Rs26.77bn in 2011, Rs30.5bn in 2012, Rs44.3bn in 2013, Rs31.7bn in 2014, Rs32.5bn in 2015, Rs45.38bn in 2016 and Rs44.11bn in 2017.
Dr Saleem said that 50 per cent of the expenditures of every airline constituted the fuel cost and when the oil price was $100 per barrel in 2012-13, the airlines suffered heavily. But when the oil price declined to $35 per barrel, every airline earned huge profits, but the PIA continued to incur losses. Only in 2008, it earned a profit of Rs1.8bn.
Referring to the swapping of profitable routes, PIA’s chief law officer Ahmed Rauf informed the court that no route had been sold or surrendered to any country. He recalled how by closing the New York route, a reduction of Rs1bn losses had been noticed.
PIA’s seat factor in the profit-making routes was also increasing, he said, explaining that closing of the New York route did not mean that the PIA had surrendered its landing rights or it could not reopen the same in future.
Published in Dawn, Aprill 13th, 2018
