Pakistan, on Thursday, kick-started outsourcing operations and land assets at three major airports through a public-private partnership as part of efforts to generate foreign exchange reserves for its ailing economy.
Although no official details of the partnership or agreement have been announced, officials claim that Pakistan has been in discussions with Qatar to outsource operations of Islamabad, Karachi, and Lahore airports.
During a meeting of Pakistan’s top economic body, the Economic Coordination Committee (ECC), a summary was presented to engage the IFC as a transaction advisor for the outsourcing process. The finance ministry announced that after detailed discussions, the ECC approved the draft Transaction Advisory Agreement (TASA) reached with the IFC by PCCA to outsource the three airports.
“The outsourcing of three airports has been initiated within the scope of public-private partnership […] to engage private investor/airport operator through a competitive and transparent process to run the airports, develop appertaining land assets and enhance avenues for commercial activities and to garner full revenue potential,” the ministry said.
According to the statement released by the finance ministry, Islamabad has enlisted the assistance of the International Finance Corporation, a division of the World Bank, to advise on the outsourcing process.
Pakistan’s aviation sector is facing significant challenges, with the national flag carrier reporting accumulated losses of almost Rs400 billion ($1.41 billion).
Ultimately, to secure foreign investment for Pakistan, Prime Minister Shehbaz Sharif traveled to Doha in late 2022 to seek Qatari investment in the country’s energy and aviation sectors, following which the Qatar Investment Authority pledged to invest $3 billion in Pakistan.
Islamabad has been negotiating the deal with Doha for several months as part of its ongoing efforts to find foreign investment to support the cash-strapped nation, which is home to 220 million people.