The Economic Coordination Committee (ECC) of the Cabinet on Tuesday approved the lease of five A320 aircrafts from the ten A319/320 aircrafts short listed on merit bases on their combined score tabulated on their financial and technical parameters.
The ECC, which met under the chairmanship of Federal Minister for Finance Ishaq Dar, rejected the remaining five aircrafts because of their low combined score.
The committee also approved the dry lease of five A320 aircrafts with the direction that the lease period of the present aircraft hired on wet lease may be extended so that a pool of at least ten aircraft can be maintained for convenience of general public and passengers.
The ECC also authorised the PIA to initiate bidding for tender of additional five aircrafts which may be inducted by June 15, 2014. The meeting observed that the finalisation of this lease by the PIA will not only rehabilitate its international credibility but also improve its image.
The aviation secretary informed the committee meeting that owing to earlier approval of the ECC in its meeting in July and release of Rs12.7 billion, the PIA was able to add six additional aircrafts which raised the number of operational aircraft from 20 to 26.
This, he said, had increased schedule integrity (in time) and no complaint of delay was reported during Hajj operations which was smooth after many years.
The secretary also informed the ECC that the loss of PIA had reduced from Rs3.3 billion to Rs1.5 billion last month.
The PIA management stated that the improvement in the performance, service and financial health of PIA was a result of the regular financial support and continued oversight by the present government.
The ECC approved providing guarantees to Exim Bank of USA and Islamic Corporation of Insurance and Export Credit (ICIEC) for providing financing for servicing and repairs of nine bowing 777 aircrafts which are the main stay of PIAC fleet subject to approval of financing terms by the Finance Division.
The finance minister observed that generally Exim Bank does not provide loans for repairs and maintenance and this reflects the confidence of the international institutions in the economic policies of the present government.
The committee also approved extension of validity of existing guarantees for the PIA by the Government of Pakistan for term loans of Rs 33.50 billion until June 30, 2014.
The meeting directed that these term loans be converted into new term finance certificates (TFC) at the earliest in order to retire the said guarantees.
The meeting was attended by Minister of Food and National Security Sikandar Bosan, Minister for Petroleum Shahid Khaqan Abbasi, Minister for Information Senator Pervez Rashid, Minister for Science and Technology Zahid Hamid, Minister for Information Technology Anusha Rehman, Board of Investment Chairman Zubair Umar and senior officials of the previously mentioned ministries.
A welcome move.
PIA's new Boeing 777 require major maintenance, because during past 6 years the airline' s corrupt management had made controversial Technical part procurement contracts, which led to pilferage of millions of dollars and in capability for even routine maintenance of this new aircraft, which all over the world enjoys a good reputation. Even if another $150 million are obtained from Exim Bank, with the same set of controversial executives at helm, what is the guarantee that the matter will not be mismanaged and funds pilfered. What stops PIA Or the Fed Govt to take action against those responsible for signing the Procurement contract with the Dubai located company?.
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