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PIA-Sabre new agreement

PIA acquires state of the art technology

Jan 01 - 14, 2001

The successful negotiations between PIA and Sabre before entering into an agreement and international recognition of safety standards provided by the Civil Aviation Authority of Pakistan have sent strong signals that aviation business in Pakistan is open and offers equal opportunities for international carriers.

Professionally sound approach being applied by the present team of PIA management to regain its past glory seems to be well directed towards the cherished goal. The strict financial and administrative discipline both on board and ground has started improving the face of the national carrier.

Following the signing of Memorandum of understanding (MoU) between PIA and Sabre, their representatives met in Dallas on December 17, 18 and 19 where they held extensive negotiations to finalize two agreements.

The first agreement deals with the settlement of outstanding issues and cancellation of three agreements previously signed in 1998. Under this agreement, both parties have agreed to withdraw their claims against each other pending with ICC.

The second agreement called "Services and Data Processing Agreement" deals with the future relationship between Sabre and PIA, under which Sabre would provide Data Processing services to PIA from their Computer Center in Tulsa, USA. The term of the agreement is 7 years and either party without any penalty can terminate it by giving 12 months notice.

This agreement will allow PIA to upgrade its services in various areas such as Reservation, Departure Control, Flight Operations, Load Control etc. For these services, PIA shall pay to Sabre 50 cent per passenger boarded regardless of number of bookings made or messages exchanged prior to boarding. Under the agreement, Sabre has also agreed to allow PIA to use its many other packages available in their system without any license fee but subject to standard yearly maintenance charge. PIA shall also benefit from reduced SITA communication charges, available to Sabre being a major user of their services. Sabre has also agreed to provide 10,000 free man-hours to assist PIA in implementing the agreement.

As soon as the system is in place, PIA shall start offering state of the art technology and services to its valued customers. Most of the problems being faced by customers under the old Reservation and Check-in system will be eliminated and customers shall start enjoying new services immediately such as internet booking, seat and meal selection, electronic ticketing and many other facilities being offered by major airlines of the world. This will be a big step for PIA to improve its image and to stay at par with other international carriers. By utilizing Sabre system, PIA will continue to have access to the latest technologies as and when available without any further investment, as Sabre shall remain responsible for upgrading and maintenance of their systems.

It may be recalled that the former PIA Chairman Shahid Khaqan Abbasi appointed Sabre Information Technology consultants to PIA. Sabre, however, left the country without any formal intimation in October 1999 owing to substantial disputes between the two commercial organizations.

In order to resolve the issue, formal talks were held between representatives of PIA and Sabre on August 26 and 27 in Karachi last year. The talks which took place on August 26-27, 2000 were conducted in the manner to be expected of the two commercial organizations, which paved the way to resolve the dispute amicably. The representatives of PIA and Sabre discussed their differences at length and sought in good faith to find a resolution to the dispute.

At the home front, both PALPA and FENA have offered their unconditional support for all round smooth operations, worldwide. The two representative bodies of PIA pilots and engineers extended their assurance following and extensive meeting with the PIA management on December 30, 2000. The meeting proved to be result oriented as the prevailing differences and misgivings were amicably resolved. Both sides displayed immense goodwill and mutual understanding to go together in harmony, as has been their tradition in the past. An agreement was also reached to grant waivers against compensation on all the waiver flights as per the practice in the past.

Meanwhile, the US Federal Aviation Administration (FAA) has announced that the Civil Aviation Authority of Pakistan now meets the safety standards set by the International Civil Aviation Organization (ICAO), giving the country 1 rating.

ICAO, the United Nations' technical agency for aviation, establishes international standards for aircraft operations and maintenance.

Welcoming the upgrading, a PIA spokesman has said that the national carrier is now to consider new destinations to America depending on operational feasibility and commercial viability. PIA used to fly to Washington and Chicago but its service is at present restricted to New York.