The outsourcing of three significant airports—Jinnah International Airport in Karachi, Allama Iqbal International Airport in Lahore, and Islamabad International Airport—has been approved by the Economic Coordination Committee (ECC), which is presided over by Finance Minister Ishaq Dar.
The action is a component of the government’s plan to draw in foreign direct investment and give travelers access to top-notch amenities.
The Public-Private Partnership Act-2017 will be used to implement the outsourcing process, which will be open to private investors and airport operators. To maximise revenue potential, it is intended to operate the airports, develop the related land assets, and improve avenues for commercial activities.
Following a thorough discussion, the ECC approved a draught Transaction Advisory Agreement (TASA) that the Pakistan Civil Aviation Authority (PCAA) had reached with the IFC for the outsourcing of the three airports.
It’s significant to note that neither the partnership nor the agreement’s formal details have been made public. However, according to Reuters, Pakistan and Qatar are in discussions to jointly manage the terminals at the airports in Islamabad, Karachi, and Lahore.
In order to entice Qatari investment in Pakistan’s energy and aviation sectors, Prime Minister Shehbaz Sharif travelled to Doha in late 2022. The Qatar Investment Authority then promised to invest $3 billion in Pakistan.
The national flag carrier has lost close to 400 billion Pakistani rupees as a result of the country’s struggling aviation industry.
The nation is in the midst of a severe balance of payments crisis, and the central bank’s reserves are now barely enough to cover four weeks’ worth of imports. The State Bank of Pakistan’s (SBP) foreign exchange holdings fell by $354 million to $4.2 billion as of March 24.
However, commercial banks’ net foreign exchange holdings are $5.6 billion, $1.3 billion more than the SBP, bringing the total amount of the nation’s liquid foreign exchange reserves to $9.8 billion.
As a result, the outsourcing of Pakistan’s three airports is an important step towards enhancing the nation’s financial situation. A transparent and competitive process will be ensured by the IFC’s involvement as a transaction advisor, luring foreign investors to increase revenue potential.
For Pakistan’s aviation industry, the country’s discussions with Qatar to jointly run terminals at the airports in Islamabad, Karachi, and Lahore are encouraging. Despite the difficulties, the nation is acting in a constructive manner to increase its foreign exchange reserves and draw in foreign investment.
