ISLAMABAD - The Economic Coordination Committee (ECC) of the cabinet has approved the lease of five A-320 aircraft to be inducted in Pakistan International Airlines fleet, besides extending validity of existing guarantees for the PIA by government of Pakistan for term loans of Rs.33.5 billion until 30th June, 2014.

The ECC, which met with Federal Finance Minister Senator Mohammad Ishaq in chair here on Tuesday, considered the acquisition of 10 aircraft to be inducted in Pakistan International Airlines (PIA) fleet. However, the top economic decision-making body of the country approved to lease five A-320 aircraft from the 10 A319/320 aircraft short-listed on merit keeping in view of their combined score tabulated on their financial and technical parameters. The committee rejected the remaining five aircraft because of their low combined score.

The ECC approved the dry lease of five A-320 aircraft with the direction that the lease period of the present aircraft hired on wet lease might be extended so that a pool of at least 10 aircraft could be maintained for convenience of general public and passengers. The ECC also authorised PIA to initiate bidding for tender of additional five aircraft, which might be inducted by June 15, 2014.

It is worth-mentioning here that board of directors of the PIA in the last week of November had given the approval to acquire 10 aircraft to be inducted in PIA fleet. However, the ECC approved to lease five A-320 aircraft. These planes are fuel-efficient aircraft equipped with latest technology used by most of the airlines and are famous for their seating capacity and fuel economies.

Finance Minister Ishaq Dar observed during the meeting that finalisation of this lease by PIA would not only rehabilitate its international credibility but also improve its image.

Secretary Aviation Muhammad Ali Gardezi informed the ECC that release of Rs.12.7 billion after a decision taken by cabinet committee on July 12, PIA was able to add six additional aircraft, which raised the number of operational aircraft from 20 to 26. This, he said, had increased schedule integrity with no complaints of delay during Haj operations. The operation was smooth after many years. The secretary aviation also informed ECC that the loss of PIA had reduced from Rs.3.3 billion to Rs.1.5 billion last month.

The PIA management stated that improvement in performance, service and financial health of PIA was a result of the regular financial support and continued oversight by the present government.

The ECC approved grant of guarantees to Exim Bank of USA and Islamic Corporation of Insurance and Export Credit (ICIEC) to extend financial assistance for servicing and repair of nine Boeing 777 aircraft which are the main stay of PIAC fleet subject to approval of financing terms by the Finance Division. The Finance Minister observed that generally Exim Bank did not provide loans for repairs and maintenance which reflected the confidence of the international institutions in the economic policies of the present government.

The ECC also approved extension of validity of existing guarantees for PIA by the government of Pakistan for term loans of Rs.33.50 billion until 30th June 2014. The ECC directed that these term loans should be converted into new term finance certificates (TFC) at the earliest in order to retire the said guarantees.

The ECC expressed concern over reports in the media regarding increase in the prices of essential commodities. The committee directed the provincial governments to further strengthen monitoring of prices and check hoarding and profiteering. The ECC expressed the hope that the provinces would share information and follow best practices to provide relief to the common man in maintaining fair prices of essential commodities.

Work on the revival of executive magistracy might be expedited by the committee already constituted for the purpose to ensure more effective check on profiteers and hoarders, observed the ECC.

The meeting was attended by Minister of Food and National Security Sikandar Bosan, Minister for Petroleum and Natural Resources Shahid Khaqan Abbasi, Minister for Information and Broadcasting Senator Pervez Rashid, Minister for Science and Technology Zahid Hamid, Minister of State for Information Technology Anusha Rehman, Chairman Board of Investment Zubair Umar and senior officials of the ministries of finance, water and power, planning and development, commerce, communications and industries.