Pakistan's national airline is taking heavy flak after it emerged that nearly a third of its pilots were holding fake or dubious licences, with some observers wondering if the struggling national carrier can survive the scandal.

Pakistan International Airlines (PIA) this week said it would immediately ground 141 of its 434 pilots after a government review found them to have obtained "bogus" credentials or cheated on exams by having someone else take them.

The scandal comes in the wake of a crash in Karachi last month that killed 98 people - and which authorities have essentially blamed on the two pilots.

Investigators said the aviators were chatting about the coronavirus while they attempted to land the Airbus A320 without putting its wheels down, catastrophically damaging the engines.

The plane lost power and plunged into houses near the airport as it went around for a second landing attempt.

According to a government review last year, details of which were revealed on Thursday, 262 of Pakistan's 860 active pilots hold fake licenses or cheated on exams.

More than half of them were from state-run PIA.

Until the 1970s, Pakistan's largest airline was considered a top regional carrier but its reputation plummeted amid chronic mismanagement, frequent cancellations and financial woes.

So far, authorities have started dismissal proceedings against 28 of the 262 pilots and subsequent criminal charges are likely, Pakistan's aviation minister Ghulam Sarwar Khan said on Friday.

PIA will bring reforms aimed at restructuring the airline, he told reporters, adding the "clean-up process" should be completed by the end of the year.

"People are saying this (revelation) will have a negative impact. But when you try to save a patient, you have to do major surgery, radiation - and even chemo," the minister told a press conference.

He sought to blame PIA's problems on "the wrongdoings of previous governments".

"God willing, 2021 will be the year of the betterment of Pakistan's institutions and, God willing, PIA will become the PIA of good times - the 1960s, '70s and '80s".