Pakistan to privatise Islamabad airport to enhance efficiency and boost revenue

Pakistan's Islamabad airport is set to undergo a significant transformation, but it is essential to clarify that this move does not constitute privatization. Instead, the government's objective is to improve the airport's operational efficiency by engaging proficient operators. The decision comes amidst Pakistan's economic crisis, characterized by soaring inflation and dwindling foreign exchange reserves, prompting the country to seek a crucial bailout from the International Monetary Fund (IMF).

The plan for Islamabad airport involves outsourcing its operational activities for a period of 15 years. This move aims to attract experienced and capable operators who can enhance airport operations. The process will involve open competitive bidding, ensuring that the best bidder is selected to manage the airport. The ultimate goal is to make the operation profit-oriented and generate revenue for the national exchequer.

To facilitate this outsourcing process, the International Finance Corporation will act as a consultant, providing expertise and guidance. As of now, there is considerable interest in the bidding process, with 12 to 13 companies expressing their desire to participate.

It is important to note that the outsourcing will not encompass runway and navigation operations, which will continue to be managed by the government.

The need for this move arises from the economic challenges faced by Pakistan, which led to the approval of a USD 3 billion bailout package from the International Monetary Fund. Additionally, financial assistance of USD 1 billion from the UAE and USD 2 billion from Saudi Arabia was also secured to avoid default on the country's debt repayments.

In conclusion, the government's decision to outsource Islamabad airport's operational activities is not a privatization effort. Instead, it aims to attract capable operators to improve airport services while generating revenue for the national exchequer, in light of the prevailing economic crisis and the IMF bailout.