Air India has estimated that it could incur losses of up to $600 million if Pakistan's airspace remains closed for a year, and has formally requested government compensation to offset the financial blow, according to a letter reviewed by Reuters.
Air India has estimated that it could incur losses of up to $600 million if Pakistan's airspace remains closed for a year, and has formally requested government compensation to offset the financial blow, according to a letter reviewed by Reuters.
The closure, which came in response to rising tensions between the two nations after a recent attack on tourists in Kashmir, has forced Indian carriers to reroute international flights, leading to increased fuel consumption and extended flight times. In a letter sent to the Ministry of Civil Aviation on April 27, Air India proposed a “subsidy model” to mitigate the impact, calculating potential annual losses exceeding ₹50 billion if the ban continues. “A subsidy for affected international flights is a good, verifiable, and fair option,” the airline wrote. “It can be removed when the situation normalizes.” The letter emphasized that Air India is the most affected among Indian airlines, citing higher fuel burn, longer flight durations, and the need for additional crew on long-haul routes due to the airspace restrictions. While Air India declined to comment on the matter, and the Civil Aviation Ministry has not yet issued a response, sources familiar with the situation said the letter followed a government request for airlines to assess the ban’s impact. Owned by the Tata Group, Air India is currently undergoing a multi-billion dollar turnaround following its return to private ownership. The airline posted a net loss of $520 million on revenues of $4.6 billion for fiscal year 2023–2024. Its recovery has already been hindered by aircraft delivery delays from Boeing and Airbus. Air India, which holds a 26.5% market share in India, operates more long-haul international routes than its domestic rival IndiGo, frequently using Pakistan's airspace for flights to Europe, North America, and the Middle East. According to aviation data firm Cirium Ascend, Air India, Air India Express, and IndiGo had around 1,200 flights scheduled from New Delhi to Europe, the Middle East, and North America in April alone. Government officials are now weighing options to support affected carriers. Three sources told Reuters that the Civil Aviation Ministry has met with airline representatives to explore possible solutions, including alternative flight paths over difficult terrain near China, and potential tax exemptions. In its letter, Air India also urged the government to engage with Chinese authorities to secure overflight clearances and requested approval to carry additional pilots on flights to the U.S. and Canada to comply with extended duty hours caused by longer routes.Dr Ghulam Nabi Fai An explosion in a residential complex in northern China killed one person and injured 21 on Wednesday, state media said, a day after a restaurant ...
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