PIA’s new era begins with Arif Habib Consortium in charge

PIA is entering a new era following the historic sale of the airline to the Arif Habib Consortium. With the PKR 135 billion (or $482 million) bid, the privatization process of Pakistan International Airlines (PIA) has now been completed, exceeding the government's reserve price of 100 billion rupees by 35%.

This deal marks a significant milestone for Pakistan’s aviation industry, but as the country’s flagship carrier changes hands, the real test now begins: can the new owners steer PIA back to financial health and restore its former glory?

In the latest episode of On My Radar, Kamran Khan said that the Arif Habib Consortium has brought more than just financial investment to the table. The consortium, which now includes Fauji Fertilizer Company, has also attracted a host of other prominent institutions, including Fatima Fertilizer, AKD Group Holdings, Lake City Holdings and City Schools.

With PIA valued at approximately PKR 180 billion, the new owners have shown keen interest in acquiring an additional 25% stake in the airline, potentially increasing the sale value by another PKR 45 billion. This could bring the total proceeds from PIA’s sale to PKR 55 billion - substantially higher than initially expected.

Now that the sale is complete, the challenge shifts to the consortium’s ability to rebuild PIA into a profitable, reliable regional airline. Aviation experts and key players in the industry emphasize several crucial steps needed to bring the airline back to its feet. One of the first tasks will be addressing PIA's outdated fleet and technological infrastructure, which are some of the airline’s biggest weaknesses.

Currently, PIA’s fleet consists of 38 aircraft, but only 18 are operational. To address this, the Arif Habib Group has announced plans to acquire 65 new aircraft, with 38 to be purchased in the first phase, while the remaining 27 will be added later based on market demand. This move is expected to not only reduce operational costs, but also to resolve flight delays and enhance overall efficiency.

A key part of PIA's revival strategy is the addition of modern, fuel-efficient aircraft, such as the Airbus A320 or Boeing 737 Max, which will contribute significantly to reducing operational expenses. This will help the airline restore its once-popular international routes, especially those to the UK and Europe, which were previously impacted by restrictions.

In 2025, flights to the UK and France were resumed after a 5‑year hiatus, marking a significant milestone for PIA’s recovery. Despite facing challenges, PIA’s air service agreements with 97 countries and landing slots in over 170 destinations worldwide remain some of its most valuable assets.

However, to fully tap into these assets, the consortium must align PIA’s safety and operational standards with global aviation norms. Establishing close cooperation with international bodies like IASA and IATA will be crucial for ensuring compliance with the highest standards. This collaboration is particularly important for the resumption of direct flights to Western countries, a key factor in strengthening PIA’s financial position.

For years, PIA's downfall has been attributed to political interference, with political appointments and unprofessional decision-making playing a significant role in the airline's decline. Experts agree that professional management will be a cornerstone of PIA’s recovery.

The Arif Habib Consortium, under the terms of the privatization deal, will be restricted from laying off employees for the first 12 months. During this period, the consortium will focus on evaluating the existing workforce and retaining high-performing employees. Customer experience will be key to the airline’s revival, and experts stress that PIA must improve its in-flight services, including cabin crew behavior, food quality, aircraft cleanliness, and entertainment.

In addition to improving passenger services, the IT infrastructure of PIA requires urgent attention. The airline’s outdated IT system must be overhauled to provide digital booking, check-in, and customer service that meets modern expectations. To remain competitive, PIA must invest in a digital transformation to ensure transparency in operations and enhance the overall passenger experience.

Another opportunity for growth lies in cargo services, which could become a significant revenue source for PIA. The airline already possesses an extensive ground handling infrastructure, which, if upgraded with modern machinery and trained staff, could provide services to other airlines, generating substantial revenue.

Moreover, code-sharing agreements with regional airlines could also expand PIA's network and provide passengers access to cities the airline currently doesn’t serve. This would help PIA build a more robust and comprehensive network, enhancing its regional influence.

The Arif Habib Consortium now has a golden opportunity to revitalize PIA. By acquiring PIA in a clean state, after the government cleared its debts totaling over PKR 654 billion, the consortium is poised to transform the airline’s fortunes. Whether they succeed will depend on their wisdom, professionalism, and ability to align PIA’s operations with global standards.

For the Pakistani government and the airline's future, the “Great People to Fly With” slogan could once again become a reality - if the consortium executes its strategy well.