By Azam Tariq

Pakistan International Airlines (PIA) posted an operating profit of Rs16 billion in FY2025-26, marking a significant improvement in the financial performance of the national flag carrier after years of losses and operational challenges, according to the Pakistan Economic Survey 2025-26 released by the Ministry of Finance.

The survey identifies the airline's turnaround as one of the notable developments in the transport and communications sector during the fiscal year, reflecting the impact of operational reforms, improved efficiency and stronger revenue generation.

According to the survey, PIA generated revenue of Rs212 billion during FY2025-26, highlighting a substantial recovery in business activity as passenger demand, flight operations and commercial performance improved.

The improved financial results come at a time when the government has been pursuing reforms aimed at enhancing the performance of state-owned enterprises and reducing the fiscal burden associated with loss-making public entities.

The survey notes that PIA's operations continued to expand during the fiscal year, supported by increasing passenger traffic and network optimization measures.

The aviation sector as a whole witnessed improved activity during FY2025-26 as economic recovery, rising mobility and growing travel demand contributed to higher passenger volumes.

According to the survey, PIA carried millions of passengers across domestic and international routes, maintaining its role as one of the country's principal air transport providers.

The airline continued operating flights to key destinations in Asia, the Middle East, Europe and North America, serving both passenger and cargo markets.

The survey highlights that operational efficiency measures contributed significantly to improved financial performance. Efforts to optimize routes, enhance fleet utilization and strengthen revenue management helped improve profitability during the fiscal year.

The Ministry of Finance notes that improved governance and financial discipline within state-owned enterprises remain important elements of the government's broader reform agenda.

The survey points out that the transport and communications sector plays a critical role in supporting economic activity by facilitating trade, tourism, business travel and connectivity.

Improved performance by national transport institutions can therefore have broader economic implications by enhancing service delivery and reducing financial pressures on public resources.

The aviation industry remains an important contributor to economic development through employment generation, tourism promotion and support for international trade and investment.

According to the survey, the government's reform efforts have focused on improving operational efficiency, strengthening financial management and enhancing service quality across public-sector entities.

The improvement in PIA's financial performance coincides with broader stabilization of the economy during FY2025-26. Pakistan's economy grew by 3.7% during the fiscal year, supported by recovery in agriculture, industry and services.

The survey notes that stronger economic activity generally contributes to higher demand for transportation services, including air travel, cargo handling and logistics operations.

PIA's improved performance also comes amid ongoing efforts to modernize and strengthen the country's transportation infrastructure and connectivity networks.

According to the Ministry of Finance, efficient transport services remain essential for supporting commerce, investment, tourism and regional integration.

The survey further highlights that aviation connectivity plays a vital role in linking Pakistan with global markets, facilitating business activity and supporting overseas Pakistanis travelling between the country and international destinations.

While challenges remain within the aviation sector, the return to operating profitability represents an important milestone for the national carrier.

The survey notes that improved financial performance can support future efforts aimed at enhancing operational sustainability, service standards and commercial viability.

The achievement is particularly significant given the airline's long history of financial difficulties and the broader challenges faced by the global aviation industry in recent years.

With revenues reaching Rs212 billion and operating profit rising to Rs16 billion, FY2025-26 marked one of the strongest financial performances recorded by PIA in recent years, underscoring the impact of operational improvements and ongoing reform efforts within the organization.

Credit: INP-WealthPk