Pakistan plans to buy four Boeing 777-200ER costing between $160.5 to $182.0 million per plane, depending on configuration, and will pay over $700 million. The Boeing is suffering from recession in airline industry and layed off tens of thousands of workers. Pakistan is losing $2 billion in trade due to war in Afghanistan. US has to give Pakistan more trade concession so that we can export our products and buy US products.
KARACHI, Oct 23 (Reuters) - State-run Pakistan International Airlines (PIA) said on Tuesday it was holding talks with the U.S. Ex-Im Bank to buy four new Boeing (NYSE:BA - news) 777 passenger aircraft.
``We have proposed to buy four Boeing 777 aircraft and the proposal is being processed by Ex-Im Bank,'' Imran Gardezi, the airline's general manager for media affairs, told Reuters from Islamabad.
Gardezi said the management had decided in August to buy new aircraft ``as and when the balance sheet will be clean'' but after getting positive signals from the finance ministry on support from the U.S. Bank, PIA had accelerated aircraft buying plans.
``This proposal was given to us by the Finance Ministry, and after initial talks with Ex-Im Bank, the airline's chief operating officer submitted the proposal to the bank last weekend,'' he added.
Pakistan has become eligible for finance from the U.S. Ex-Im Bank after Washington in September lifted sanctions imposed for Islamabad's 1998 nuclear weapons tests.
Gardezi said PIA would seek bank loans to finance the purchase, after getting clearance from Ex-Im Bank, which he expected in November or December.
PIA currently operates an ageing fleet which includes five Boeing 747-300s, three Boeing 747-200s, seven Boeing 737-300s, nine Airbus [ARBU.UL] A300-B4s, six Airbus A310-300s and 11 Fokker F27s.
Gardezi said the decision to purchase new aircraft was taken to upgrade the ageing fleet and that the Boeing 777 met PIA requirements.
``It (Boeing 777) is considered to be the latest and most fuel efficient ... The decision is to equip the airline with state-of-the-art aircraft,'' he added.
The airline lost 2.3 billion rupees ($35.9 million) in the first six months of the current calendar year and its accumulated losses stand at 11 billion rupees.
The carrier lost 3.3 billion rupees in 2000 and has heavy liabilities estimated to be worth at least 24 billion rupees.
The airline struck a deal in July with a consortium of five local banks for bridge financing worth 4.73 billion rupees under six-month terms of two percent above the central bank's discount rate, which currently stands at 10 percent.
PIA, Pakistan's dominant airline, has 22,000 employees and is slated for privatisation in the next 18 months.
The airline said earlier this month that in the wake of the deadly September 11 suicide attacks on the United States, PIA had cut 15 percent of its flights but marked a 30 percent growth in cargo traffic after foreign carriers suspended Pakistan operations.
PIA shares on the main Karachi Stock Exchange gained 10 paisas on Tuesday to close at 3.55 rupees.
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