By: Malik Arsalan Awan
The whole country was awestruck when the news of the plane crash in Karachi came in all across national television and social media. This crash was similar to adding fuel to the already lit explosives ignited by Covid-19 and the whole 2020 in general. It is true that the recent crash is sure a heart breaking incident but where does PIA and the Pakistani aviation industry stand in all of this and one must not forget how the gradual deterioration of the industry in Pakistan led to this crash in the first place.
The national flag carrier is, regrettably, losing its reputation day by day, both on the national and international levels.
Amidst the ensuing crisis which the industries in Pakistan are facing in terms of economics, there is one industry in particular where the turbulence is completely crushing, where the impact of Covid-19 has taken hold of the industry by the jugular; the impact being so severe that it has forced the big fishes of the industry to bow-down before the government relief funds and grants. According to IATA (International Air Transport Association) it is estimated that the global airline revenue is set to drop by $314 billion by the end of the year, following the cancellation of about $3.5million flights which were scheduled until the end of June. What’s even more daunting is the fact that about 25 million jobs are at risk. Never in the history has the industry felt so vulnerable, the likes of this pandemic has downplayed the impact of both 9/11 and 2008 economic recession.
Considering the situation in Pakistan, the industry just can’t seem to flourish no matter what, even before the advent of this virus. Everyone’s favorite PIA is always packed in the midst of controversies and scandals. Consequently there is also the problem of extra-labor in PIA, in comparison both Singapore Airlines(SIA) and PIA have similar number of employees but the difference in the number of planes in their fleets is significant, SIA almost has a 100 more aircraft in its possession, this is very alarming. The competitive and robust nature of the national air-line always frenzies the minds of its passengers; even their reliance on giving ‘sadka’ is particularly adored, as one may recall after the infamous tragedy that happened with the ill-fated ATR-42. Secondly the most profitable route for PIA has always been associated with the transport of pilgrims to and from the holy-cities, keeping in account of the developing conditions there might be a slight chance that this year’s Hajj is suspended, if this happens then PIA will inevitable further fall in the pit of its own making. Airblue and Shaheen similarly are also barely sustaining themselves; they too would need support from the government in various forms. Wealthier countries are significantly keeping their respective airlines at bay by providing them the essential stimulus, for example in America, the Trump administration handed over a sum of $58 billion to prop up the industry, which will give various airlines the air they desperately needed. Established in 1955 as a result of the merger with private airline company Orient Airways, PIA has been the dominant carrier in Pakistan’s market since its inception. The national flag carrier is, regrettably, losing its reputation day by day, both on the national and international levels. Negative reports regarding the airline are being unearthed every day. Once the only route to the US favoured by regional countries, including China, PIA is currently limiting its flight operations to 29 international and 21 domestic routes. It currently has a fleet of 43 aircrafts and employs between 15,000 and 19,000 employees. These numbers lead to an aircraft to employee ratio of 1:418, which is the highest in the world. It was also dubbed as the world’s least productive airline and has accumulated a debt of 300 billion Pakistani rupees, posing yearly losses of around 20-30 billion Pakistani rupees every year. Nevertheless, it still has a little below 40 percent of the market share for international flights originating in or ending in Pakistan along with a domestic market share of almost 75 percent.
The Government of Pakistan has repeatedly tried to privatize PIA but has failed to do so. The failure has been due to a mix of political and socioeconomic factors that have made privatization quite difficult. The latest efforts came in the form of the Pakistan International Airlines Corporation (Conversion) Ordinance 2015, which was met with fierce opposition and riots from the employees of PIA and consequently the ordinance was retreated into a bill and the Government had to issue a statement promising not to privatize the failing SOE.
Many of the problems faced by PIA are those that many publicly owned airlines face. The overstaffing problem comes from the fact that a job in the flag carrier of the country is often seen as a position of prestige and hence jobs are often given as political favors and handouts. The use of national funds to update fleets and cover the highly capital intensive needs of an airline is another issue that governments, particularly those of developing countries, often face.
However, only blaming PIA’s employees for its downfall is not right. In fact, anybody hired in accordance with the due HR procedures is innocent. The real culprit is the one who compromised on the recruitment standards to facilitate the entry of incompetent staff. To get rid of such unwanted workforce, PIA has to introduce beneficiary schemes like the ‘golden handshake’. Many suggestions are under discussion for the betterment of PIA. Some elements are of the view that privatization can save the national carrier from a complete disaster. According to my knowledge, the government holds 94 percent of the airline’s shares, while four percent belong to other state institutions and the remaining two percent are owned by private investors. Those who favor privatization are basically demanding to float further 43 percent shares in the market. Another question that comes to mind is that if a private businessman could elevate PIA from its woes then why the government hasn’t acted till now. To make PIA a commercial institute generating a profit of one billion instead of a loss, within one year, we would have to ensure that its higher management and operations remain stable – without any political interference.
The writer is an entrepreneur, social activist and motivational speaker based in UK.