The Pakistani government says it has initiated an “open bidding” process for a concession to run Islamabad International Airport (ISB) as part of a broader privatization initiative.
Previously, Pakistan had considered a government-to-government arrangement to outsource management of ISB. But the government’s Privatization Ministry said in a statement that it is now seeking “long-term commercial concessions” for the management of ISB, as well as airports in Karachi and Lahore.
Pakistan appears to be pursuing a public-private partnership model for the management of the three airports.
“The primary objectives of the government are to enhance efficiency, improve service delivery, maximize revenue generation, upgrade infrastructure and attract domestic and international private sector investments,” the Privatization Ministry said.
The Pakistani government said the process to secure private management of the airports will be “competitive” and open to “all domestic and foreign investors, [which] will have a level playing field to participate in the bidding process. This decision does not have any political or diplomatic background, and is based purely on economic and procedural reasons.”
The government added the process is “designed to promote transparency and fair competition, deliver the most advantageous results for Pakistan's economy and reinforce our enduring relationships with international partners.”
The Privatization Ministry said a “high level of interest from various investors” led the government to move on from considering a government-to-government arrangement and instead pursue “an open bidding mode for all three airports.”
The Privatization ministry made a point to criticize media reports regarding failed talks between Pakistan and the United Arab Emirates (UAE) over a government-to-government management model in which a designated UAE entity would run ISB. In particular, The Express Tribune, an English-language newspaper based in Pakistan, reported a preliminary agreement between Pakistan and the UAE over the management of ISB failed to reach finalization as the UAE lost interest.
Pakistan said it had engaged in “constructive dialogue with entities from valued partner nations, including the UAE, Turkey [and] Saudi Arabia,” but said reports it had “canceled” a “lease agreement” with the UAE to run ISB were “contrary to the facts and misleading, as no such agreement or lease was ever signed for any of the airports, including Islamabad International Airport.”
However, the article in The Express Tribune referred to a “draft framework agreement” and not an officially signed lease.
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