The Finance Minister has rejected the commercial banks’ request to delay the recovery of PIA loans. Banks had proposed a fixed interest rate of 16.6% per annum for a 5-year deferment on the Rs 281 billion owed by Pakistan International Airlines (PIA).
However, Finance Minister Dr. Shamshad Akhtar declined this offer and instead proposed a 10% interest rate on the loans.
According to sources in the Ministry of Privatization, banks are hesitant to issue a No Objection Certificate (NOC) for transferring PIA’s loan to a new company, citing other concerns. The decision to privatize PIA involves splitting it into two parts, a move that requires unanimous agreement from all stakeholders, but progress has currently come to a halt.
Sources also mention that Privatization Minister Fawad Hasan Fawad is expected to return from Davos at the end of the week, and any further developments are likely after his return. As of last month, PIA’s outstanding debt to commercial banks amounted to Rs 281 billion, with an interest rate of 23.5% on these loans.