Finally, good news! I have received passport request for my parents today!
My timelines:
Jan. 14, 2014: Application Received
Apr. 14, 2016: Sponsorship Approval Received
Jul. 11, 2016: Notified that CIC started processing our PR application
Aug. 15, 2016: Instructed to complete medicals, pay PR fees & provide Police Clearance Certificate (PC provided/ fees paid/medicals completed - Aug.24th)
Oct. 21, 2016: Passports requested (Ready for Visa)
Thank you everyone for sharing your experiences during this process! I found this forum extremely useful; it helped me manage my expectations during the various stages.
For those still waiting, good-luck and have hope! It looks like things are moving along.
All the best!