Pakistan International Airlines cancels flights over non-payment of dues to fuel supplier

Islamabad [Pakistan]: Pakistan International Airline (PIA) flights have been severely affected as Pakistan State Oil (PSO) stopped fuel supply to the national carrier over non-payment of dues to the company, Geo News reported on Monday.

As a result, the Airline cancelled 26 flights from Karachi, Lahore, Islamabad, Quetta, Bahawalpur, Multan, Gwadar, and other cities in Pakistan.

According to Geo News, a PIA spokesperson informed that the affected passengers were provided with alternative flights.

Meanwhile, only three flights will take off from Karachi today as per the fuel adjustment plan of the PIA.

On October 21, PIA paid PKR220 million (approx. 789000 USD) to the Pakistan State Oil (PSO) for a two-day fuel supply.

As per ARY News, PIA disbursed the fuel payment worth PKR 220 million to the PSO for October 21 and October 22.

The PIA spokesperson said that the airline has paid Rs500 million so far to the PSO for the provision of fuel, adding that the national flag carrier is making payments to PSO daily.

PIA is currently acquiring fuel for profitable routes including Saudi Arabia, Canada, China, Kaula Lumpur and others.

Earlier, Pakistan International Airlines (PIA) faced fresh turbulence as its domestic flight operations were disrupted on account of non-payment of dues, leading to a complete halt in the supply of aviation turbine fuel to the carrier, the Dawn reported.

The Pakistan-based daily reported further, citing official sources, that Pakistan State Oil (PSO) halted the supply of aviation fuel to the national carrier on Tuesday.

On October 17, in a direct fallout of the same, the airline cancelled 14 domestic flights while four others were delayed by several hours, the report added.

The cancelled flights included two from Islamabad to Gilgit, one from Islamabad to Quetta, one from Karachi to Sukkur, one from Islamabad to Multan and another from Karachi to Faisalabad, Dawn reported.

Meanwhile, PIA had requested an emergency bailout of Pakistani Rupees (PKR) 22.9 billion, which was rejected by the Economic Coordination Committee (ECC).

The ECC also turned down a request by the PIA for deferment of the payment of Rs 1.3 billion per month, which the national carrier pays to FBR against FED and Rs 0.7 billion per month which it pays against the rising charges, Geo News reported.

The PIA also warned that Boeing and Airbus might suspend the supply of spare parts for its fleet by mid-September. In July, the Federal Board of Revenue (FBR) froze the national carrier’s account on the basis of non-payment of more than Rs 2 billion in taxes, according to ARY News.

In January last year, the FBR froze 53 bank accounts of the PIA after it was found to have defaulted on taxes worth PKR 26 billion. However, those bank accounts were restored after PIA assured them of early clearance of the taxes.