ISLAMABAD:
The National Assembly Standing Committee on Defence has examined the financial challenges faced by the airline industry, including PIA, with special focus on the existing taxation regime.
The committee, which met with Fateh Ullah Khan Miankhel in the chair acknowledged the Ministry of Defence’s efforts for holding transparent bidding process of PIA.
Members noted that while ticket prices have not significantly increased in dollar terms, the imposition of taxes, including sales tax, has placed a substantial burden on airlines.
It was agreed that a comprehensive study on the taxation regime and its impact on the aviation sector would be prepared and presented to the Minister for Defence and subsequently to the Prime Minister.
The NA panel also appreciated the statement of new owner for taking care of employees as well as enhancement in flight operation in near future.
The committee while reviewing the implementation status of previous recommendations concerning private airlines and key operational issues in the aviation sector, discussed matters relating to flight regularity, cancellations and delays, fare structures, and fleet resilience, with particular concern expressed over high domestic airfares and their impact on passengers.
The committee was informed that Arif Habib consortium had successfully won the bidding of the Pakistan International Airlines (PIA) for Rs135 billion.
The role of the Civil Aviation Authority and airline operators in ensuring service quality, consumer protection, and continuity of domestic operations alongside international expansion was emphasized. The committee also deliberated on public grievances and underscored the need for improved monitoring and regulatory oversight.
The Chairman was also tasked with arranging a meeting with the Finance Minister and relevant authorities to discuss possible rationalization of taxes and to apprise the committee of the outcomes.
Issues relating to the broader aviation sector were also discussed, including medical facilities at aviation installations, radiation-related concerns, and the need to address shortages of trained and skilled staff.
The committee decided to undertake visits to relevant ground facilities as part of its oversight role to assess conditions firsthand and recommend corrective measures. The handling of previous parliamentary forums and their recommendations was appreciated by the members.
The committee also deliberated on the privatization of PIA, including the treatment of liabilities and the proposed utilization of proceeds for debt servicing and social sector development.
Project implementation challenges were reviewed, with emphasis on prioritizing ECNEC-approved projects in the defence and aviation sectors. The Ministry of Planning and the Ministry of Defence were directed to review ongoing projects, including strategic airports and the National Aviation Security Academy, provide updates on fund utilization, and seek timely release of required allocations.
The committee further decided to review and approve pending subcommittee reports in the next meeting and to follow up with the Prime Minister’s Office and the Ministry of Finance regarding relaxation of recruitment rules for the armed forces and police, with outcomes to be shared with concerned ministries.
