Govt not financing purchase of new PIA aircraft, says finance adviser

Finance adviser Khurram Schehzad confirmed on Sunday that the Pakistani government is not financing the purchase of new aircraft for Pakistan International Airlines (PIA) following its privatization. This clarification came after a meeting between Finance Minister Muhammad Aurangzeb and John Jovanovich of the US Export-Import (Exim) Bank at the United Nations General Assembly in New York.

Schehzad emphasized that the government is not purchasing aircraft for PIA nor has announced any government guarantee or taxpayer-funded loans for this purpose. The US Exim Bank's primary role is to promote US exports and employment, and Boeing aircraft, being US exports, are eligible for financial assistance under established mechanisms.

PIA's acquisition by Boeing aircraft, therefore, could be facilitated through this framework. Schehzad stressed that a government guarantee is not a mandatory condition for asset-backed aircraft financing. He also clarified that the finance minister's discussions with the US Exim Bank were broader, encompassing potential financing for various sectors like aviation, refinery expansion, and the Reko Diq project.

The adviser rejected claims that the proposed aircraft financing would create a hidden subsidy or transfer PIA's commercial risks to taxpayers, asserting that no such arrangement has been announced.