The Rs30 billion headline is technically true and economically incomplete. Pakistan’s taxpayers are servicing a debt associated with PIA, but that debt does not sit inside the privatised operating airline, was not borrowed by its new owners and is not the same thing as the separate 15-year sales-tax concession now dominating the political conversation.
That distinction does not make the public liability disappear. It makes the criticism accurate.
The real scandal is not that the government secretly picked up a private company’s new loan after privatisation. It is that successive governments allowed a state-owned PIA to accumulate liabilities so large that the operating airline could not attract a credible buyer until those liabilities were carved out, quarantined inside a government-owned holding company and effectively placed behind the sovereign balance sheet. Pakistan deserves anger aimed at the correct ledger—not an emotionally irresistible but financially confused story in which debt servicing, tax exemptions and sale proceeds are all presented as the same transaction.
What Is Actually Happening?
According to The Express Tribune’s report, the federal government has provided Rs73 billion under a broader privatisation-contingency head. Approximately Rs30 billion of that provision is expected to cover interest on Rs268.5 billion of PIA’s old commercial debt during the current fiscal year.
That Rs268.5 billion debt was moved to PIA Holding Company Limited before the operating airline was privatised. The restructuring was approved in 2024, with banks reportedly agreeing to a ten-year arrangement carrying a maximum interest rate of 12 percent. The Special Investment Facilitation Council’s official account stated at the time that responsibility for the restructured debt would rest with the federal government.
Therefore, the precise statement is simple:
Pakistan is paying interest on the pre-privatisation debt of the formerly state-owned PIA through a government-owned holding company. Pakistan is not paying Rs30 billion toward debt raised by the airline’s private buyers.
Both sides of the argument are holding one part of the truth. The headline is correct that taxpayers are carrying the cost. The correction is equally correct that the debt was removed from the operating company before privatisation. What is wrong is presenting Rs30 billion as a tax concession, cash gift or post-sale loan repayment made on behalf of the new owners.
