The cash-strapped Pakistan International Airlines (PIA) ranked fifth in domestic flights in the punctuality report of the Civil Aviation Authority (CAA) from January to June this year.
The ranking reflects the mismanagement of the national flag carrier’s administration and the effects of its financial crisis. These woes have had a severe adverse impact on the on-time departure and arrival of the state-run PIA’s domestic flights.
The departure ratio of domestic PIA flights was recorded at 58.24%. The airlines ranked from 1st to 4th are private ones.
The on-time departure and arrival ratio of the flights of private airline was much better than that of the national flag carrier.
The on-time departures and arrivals of PIA flights during January-June 2023 were probably the worst in the airline’s history.
Private airline Fly Jinnah grabbed the top slot with an 87.93% flights punctuality rate. Air Sial stood at second place with its flights punctuality rate at 86.89% Airblue came in third place with a 78.36% flights punctuality rate. The fourth position was secured by Serene Airlines with a flights punctuality rate of 62.7%,
No Pakistani airline has achieved a 100% on-time departure and arrival rate.
The PIA has suffered a loss of Rs60.71 billion in the first six months of the ongoing year, according to the national flag carrier’s financial report for 2023 released recently.
The airline had put up with a loss of Rs41.31 billion in the corresponding period last year.
According to the report, the PIA suffered a loss of Rs27.45 billion in the first six months of this year because of the depreciation of the rupee.
The loss stood at a sum of Rs13.85 billion because of the currency exchange rate during the same period in 2022.
In the first half of 2023, an amount of Rs48.34 billion was spent on fuel and oil. During the same period last year, a sum of Rs30.78 billion was spent on fuel and oil.
The cost of finance in the first half of this year was Rs36.82 billion. This amount stood at Rs21.11 billion in the same period last year.
In the first six months of 2023, the total revenue generated by the PIA came to Rs120.27 billion. According to the report, this was a gross profit of Rs11.25 billion in comparison with the first six months of last year.
In the first half of 2022, the national flag carrier had managed to earn an amount of Rs71.19 billion.
The report mentioned that the operational cost of the airline rose by 41% because of the increase in fuel and oil prices and a hike of 20% was paid in interest rates.
SHC’s stay on executive committee orders irks PBC
Pakistan Bar Council Vice Chairman Haroonur Rasheed has taken strong exception over the Sindh High Court to grant stay on its executive committee orders, demanding of the chief justice of Pakistan to look into the matter and take appropriate action in this regard.
In a statement issued on Monday, the PBC vice chairman said, “It is often observed that Orders of Executive Committee of the Pakistan Bar Council which are assailed by the aggrieved person(s) before the Hon’ble High Court of Sindh through civil suit are being taken up by the High Court of Sindh in the Court or in Chamber and injunctive Order has been passed which are not entertainable in the eye of law due to lack of jurisdiction.”
Rasheed said, “The High Court of Sindh has no jurisdiction to set aside any Order assailed which is passed by the Pakistan Bar Council or its Executive Committee at Islamabad the proper forum for that is Courts of ICT, so any order passed by the High Court of Sindh that would be non-existing and nullity in the eye of law as one rather sitting in Khyber-Pakhtunkhwa, Punjab or Balochistan cannot set over the territorial jurisdiction and the High Court of Sindh should not pass injunctive Orders on the matters decided by the Pakistan Bar Council at Islamabad just to please their blue eyed person(s), which amount to undue interference in smooth functioning of a statutory body having its office in Islamabad.”
The statement added, “The tendency of such like issues creates serious doubts upon credibility of those decisions which have been passed without jurisdiction.”
Rasheed said that no high court of any province had jurisdiction, especially the SHC, to create hindrance in affairs of the regulatory body of lawyers who had the mandate under Section 13(2) of the Legal Practitioners & Bar Councils Act, 1973, to decide matters of Provincial/Islamabad Bar Councils and all bar associations of the country, which were challenged before it.
Pakistan, UAE ink MoUs for mega investments
Pakistan and the United Arab Emirates (UAE) inked several Memoranda of Understandings (MoUs), paving the way for multi-billion dollar investments in diverse initiatives outlined by the Special Investment Facilitation Council (SIFC).
The signing ceremony took place in Abu Dhabi, witnessed by Caretaker Prime Minister Anwaarul Haq Kakar and UAE President Sheikh Mohammed bin Zayed Al Nahyan, subsequent to a bilateral meeting between the two leaders.
The MoUs cover investment cooperation across various sectors, including energy, port operations, waste water treatment, food security, logistics, mining, aviation, and banking and financial services. The agreements aim to foster collaboration and stimulate significant investments in these key areas, a handout released by the Media Wing of the Prime Minister’s Office and the Information Ministry.
Caretaker Prime Minister Anwaar-ul-Haq Kakar today held a bilateral meeting with His Highness Sheikh Mohamed bin Zayed Al Nahyan, President of the United Arab Emirates in Abu Dhabi. Chief of Army Staff General Syed Asim Munir, NI (M) was also present at the occasion.
— Prime Minister’s Office (@PakPMO) November 27, 2023
On the occasion, Kakar termed the signing of the MoUs a historic event that “will take economic cooperation between both brotherly countries to new heights and open doors of economic prosperity and socio-economic development of Pakistan”.
Kakar also highlighted the success of the SIFC in creating a business and investment-friendly environment through one-window operation and fast-tracking the initiatives. He expressed the hope that the MoUs would turn into tangible projects very soon.
Separately, Kakar, who is on a two-day visit to the UAE, said in a video message that with the signing of the MoUs, the bilateral economic and strategic relations had entered into a new era of bilateral cooperation. On that he congratulated the people of Pakistan and the UAE.
“Foundation of friendship with Pakistan that was laid by Sheikh Zayed bin Sultan Al Nahyan in the 1970s, has been taken forward by his son Sheikh Mohammed bin Zayed Al Nahyan to a new era,” the prime minister said in his message.
Earlier, Prime Minister Kakar held a bilateral meeting with Sheikh Mohamed. Chief of Army Staff General Syed Asim Munir was also present during the meeting. In their talks, the two leaders reaffirmed their resolve to strengthen the bilateral strategic cooperation and dialogue.
Prime Minister Kakar expressed profound gratitude for the UAE’s firm support for Pakistan in economic and financial domain. The UAE is home to 1.8 million Pakistanis, contributing to the progress, prosperity and economic development of the two brotherly countries, he noted.
Read more: Kakar arrives in Abu Dhabi on two-day visit
During the meeting, regional and global developments in the region were also discussed with particular reference to the escalating hostilities in the occupied Palestine. The prime minister expressed concern over the human cost of the dire situation in Gaza.
Kakar reiterated Pakistan’s full support to the UAE’s Presidency of the COP-28 and underlined the importance of the global gathering on climate change as an opportunity for meaningful progress towards effective and result oriented global actions on key areas, including the Loss and Damage fund.
Later in the day, Prime Minister Kakar embarked upon a two-day bilateral visit to Kuwait. During the November 28-29, 2023 visit, the prime minster will meet Kuwaiti Crown Prince Sheikh Meshal Al Jaber Al Sabah, Prime Minister Sheikh Ahmed Nawaf Al Ahmed AL Sabah.
The Foreign Office spokesperson said in a press release that the visit would include the signing of various MoUs in the fields of manpower, information technology, mineral exploration and food security, energy and defence.
IMF secured autonomy to access SBP info: Fawad
Privatisation Minister Fawad Hasan Fawad said on Monday that the International Monetary Fund (IMF) secured autonomy for Pakistan’s central bank to get direct access to the information that the federal government was reluctant to share with the global lender.
The startling statement by Fawad may further deepen suspicions about the motives behind securing the absolute autonomy for the State Bank of Pakistan (SBP) in January last year by the global money lender. This also raises questions on the role of the then central bank governor, Dr Reza Baqir.
The IMF first got the autonomy for the SBP, then made the central bank governor dependent on it and was now directly getting the information, which we earlier did not want to give to the IMF, Fawad said while responding to a question about the banking sector.
The privatisation minister maintained that a question should also be raised as to why the IMF and the World Bank do not ask about reducing the spreads in lending and deposit rates of the commercial banks, which were one of the highest in the world. He said the Privatisation Commission was getting only 4% profit on its Rs6 billion deposits placed with the National Bank of Pakistan.
Before 2022, the IMF used to deal with the central bank through the Ministry of Finance. But post amendments in the SBP Act the finance ministry does not know about SBP-IMF dealings, except in cases where the SBP governor himself reveals information to the finance minister or to the ministry.
In 2022, opposition parties had strong concerns over the SBP Act amendments, saying it compromised Pakistan’s economic sovereignty and gave absolute authority to the SBP to take key economic decisions independently.
The absolute autonomy was granted in January 2022 in return for a $1 billion loan tranche. The governor has also been given complete autonomy in his affairs.
In 2021, The Express Tribune had reported that the then central bank management was pushing the finance ministry to accept the amendments in toto or the IMF tranche of $1 billion would be compromised.
The Express Tribune on Monday sent a question to Baqir, who spearheaded SBP autonomy, about Fawad’s statement. But his response could not be received till the filing of the story. Baqir left the country after his three-year tenure ended in 2022.
Fawad also spoke about the need of privatisation and the reforms in Pakistan.
The minister said that under the Privatisation Law it takes about 462 days to complete one privatisation transaction, adding that the interim government would try to privatise the entities that are difficult for a political government due to its consequences.
The interim government is trying to privatise PIA but has not yet succeeded.
Fawad said the government is expected to sign a Financial Advisory Service Agreement (FASA) with the Ernest and Young-led consortium. The cabinet approved the E&Y consortium hiring this month but the agreement signing remains pending and would be finalised this week.
After the signing of the agreement, the advisor would need at least six to nine weeks to prepare a privatisation transaction structure and another 20 to 26 weeks to complete restructuring of the PIA balance sheet.
Fawad revealed that for the past six weeks he was facing difficulties to put together a credible PIA board, as people were reluctant to serve on it for a short term period. He said there were also difficulties in arranging loans for the PIA.
The government had tasked a technical committee to prepare a PIA debt restructuring plan and also arrange Rs15 billion loans for the national carrier within two weeks. There has been no success on this front for the past over one month.
The privatisation minister revealed that people on the state-owned enterprises boards were appointed by the last coalition government based on their political affiliations.
The Privatisation Board was also appointed by the PDM government during its last days and it is widely seen as a political entity having little expertise in the complex matters, according to sources.
Fawad opposed handing over power distribution companies to the provinces, fearing it may result in the worst form of cartelisation in the power sector.
The minister also spoke “very bitterly” about the poor performance of the Federal Board of Revenue (FBR) and set four conditions for any reforms in Pakistan, prominently stating that there should not be any further increase in the size of the government.
“Anything which increases the size of the government is not a reform,” Fawad said in a statement that apparently kills Caretaker Finance Minister Dr Shamshad Akhtar’s proposal to establish a new Tax Policy Division for separating policy from the FBR.
Prime Minister Anwaarul Haq Kakar had not approved Dr Akthar’s restructuring plan and referred the matter to another committee, including Fawad in the FBR restructuring process.
Fawad highlighted the flaws in the country’s taxation system, saying that around 93% of the collected tax revenue is either voluntary or withholding; whereas, only 7% is actually collected by the FBR.
He said in three years revenue board had sent recovery notices to individuals worth Rs600 billion but the actual recovery was less than Rs4 billion from 2013 to 2016. Since 2016, the tax burden on corporate taxpayers has increased by more than 40% on average.
Such a burden has not only contributed to encouraging people to stay out of the tax system but also de-corporatisation.
The public sector reforms should include bureaucratic reforms and taxation system reforms, he said, adding that these two areas are crucial for improving the performance of the state.
Fawad observed that the current state of the public sector was unsustainable.
In three years from 2018-2021, the government spent Rs2.54 trillion in terms of subsidies, grants, and loans to keep commercial SOEs operational. The size of the government has increased by more than three times in the last couple of decades.
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