PIA cancels dozens of flights as funds to pay for fuel dry up

Pakistan International Airlines (PIA), the embattled national airline of Pakistan, was forced to cancel dozens of domestic and international flights because it could not pay its fuel bills, said officials. The state-run airline is long-accused of being poorly run. It has seen its funds drying up as the government itself battles balance of payments crisis caused by debt repayments.

Athar Awan, a deputy spokesman for PIA, said 48 international and domestic flights were cancelled on Tuesday and Wednesday "due to non-availability of fuel". He was quoted by AFP

"The reason for the disruption in fuel supply is non-payment of dues because PIA is facing a financial crisis and cannot pay the dues to Pakistan State Oil on time," a PIA official speaking on condition of anonymity told AFP.

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Pakistan economy is in dire straits following decades of mismanagement and instability. The country was forced into another bailout from the International Monetary Fund (IMF) to avoid debt default.

Pakistan's interim government has said that it plans to sell off the airline.

"The process of privatisation for the national airline should be made more transparent and expedited to prevent further financial losses to the national exchequer," caretaker Prime Minister Anwaar-ul-Haq Kakar said in a statement last week.

AFP quoted an unnamed senior official of Pakistan State Oil (PSO) who said that the state-owned oil company was "providing fuel for only flights that PIA has prioritised".

The official said that PIA has agreed to pay PSO 100 million Pakistani rupees (around $360,000) every day to cover dues.

"On Wednesday PSO received a payment of 150 million rupees in return 26 flights were refuelled", the official added as per AFP.

PIA has said in a statement that it expected normal service to resume on Thursday and that it paid for fuel "from its own resources".

Bloomberg has previously reported that PIA had liabilities of 743 billion rupees (around $2.5 billion), exceeding its total assets by five times.

PIA came into being in 1955 when the government nationalised a loss-making commercial airline, and enjoyed rapid growth until the 1990s.

The airline's reputation was also battered by a series of strikes, hijackings and accidents -- including the crash of an Airbus in Karachi in May 2020 that killed 97 passengers and crew.

(With inputs from agencies)

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