By Staff Reporter
KARACHI: Pakistan International Airlines is set to resume direct flights to London in March after a six-year suspension, a move that comes as a local consortium led by Arif Habib Group finalizes its acquisition of the beleaguered carrier in a privatization push aimed at stemming years of losses.
The state-owned airline, which has racked up more than $2.8 billion in red ink amid mismanagement and safety scandals, will operate four weekly flights from Islamabad to London’s Heathrow Airport starting March 29, 2026, according to a statement from PIA on Tuesday. The service will use Terminal 4 at Heathrow. “London was the airline’s first-ever international destination and remained one of its most important routes,” the PIA spokesperson said.
The resumption follows the lifting of a European Union ban on PIA flights in November 2024, more than four years after the restriction was imposed in the wake of a deadly 2020 crash near Karachi that killed about 100 people. The accident prompted revelations from Pakistan’s then-aviation minister, Ghulam Sarwar Khan, who told parliament that pilots’ licenses were “dubious.” The UK followed suit with its own prohibition but removed Pakistan from its Air Safety List in July 2025, paving the way for PIA’s return.
PIA already restarted three weekly flights to Manchester in September after securing approval, with plans at the time to expand to Birmingham and London. The airline views the UK, US and Canada as a “lucrative market,” according to Arif Habib, chief executive officer of the Arif Habib Group.
The flight revival coincides with a major overhaul under new ownership. A cabinet committee on privatization, chaired by Deputy Prime Minister Mohammad Ishaq Dar, on Tuesday endorsed a Rs135 billion bid from the Arif Habib-led consortium for a 75% stake in PIA, recommending cabinet approval. The offer topped the government’s reference price by 35% and includes a commitment to inject an additional Rs80 billion over five years.
Dar urged officials to expedite the process, expressing hope that privatization “will lead to the PIA regaining its glory days,” according to a statement from his office. The consortium, which includes AKD Group Holdings, Fatima Fertilizer Co., City Schools, Lake City Holdings and Fauji Fertilizer Co., the latter owned by Pakistan’s military, emerged as the winner in a Dec. 23 bidding round overseen by Privatization Adviser Muhammad Ali. The deal values PIA at Rs180 billion and marks Islamabad’s boldest effort in years to offload loss-making state enterprises, a condition of the International Monetary Fund’s $7 billion bailout for the cash-strapped South Asian economy.
Habib, whose group spans brokerage, real estate and other sectors, outlined ambitious revival plans in an interview with Arab News this week. The new management intends to renovate aircraft interiors, boost punctuality and expand the fleet from 19 planes to 64 over eight years. “We will renovate the check-in counters and the cabins. We will replace the seats and put the entertainment equipment into it,” Habib said. “We will also ensure the punctuality of flights. That will bring market confidence, and with that there will be a culture change.”
In the initial phase, PIA would add 38 aircraft aged four to seven years, both narrow- and wide-body models, before scaling up further. “There are routes where there is incremental demand there, but because of the limited aircraft available with PIA, they are not able to serve the whole market,” he said. The airline is negotiating with the US Federal Aviation Administration to restart American routes, while eyeing increased frequencies to the UK and new services to Canada from Karachi, Lahore and Islamabad. Bound by terms prohibiting changes to PIA’s name or logo, Habib left open the possibility of updating staff uniforms. “It’s too early, but I definitely will consider all options whereby we improve the brand,” he said.
To fund the turnaround, the consortium plans a $400 million investment, with two-thirds upfront upon taking control in April and the rest a year later. “Since we are putting in a large sum, about $400 million, into the company, that $400 million will be available to the company for all these improvements,” Habib said. “If PIA is able to improve its services and improve its cabin and aircraft, I think there is a huge market waiting for PIA.”
Still, he cautioned that losses would persist for one to two years before turning around in the medium term, with “reasonable returns” expected over a decade. PIA’s balance sheet currently shows about Rs9 billion in liabilities. The group has a 90-day option to acquire the government’s remaining 25% stake and may seek a foreign airline as a technical partner to enhance competitiveness. “We are thinking of bringing in some foreign airline as our partner who would be the technical partner for [our] airline,” Habib said. After a three-year lock-in, the consortium could list PIA on the stock exchange or bring in more investors if needed.
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