Air India, which now belongs to the Tata group, estimated a loss of nearly $ 600 million if Pakistan airspace remains closed to Indian carriers for a full year and has urged the central government to provide financial assistance to compensate for the impact.
In a letter dated April 27 addressed to the Ministry of Civil Aviation, the airline asked for a “grant model” to help amuse the blow, projecting an annual loss of more than 50 billion rupees due to longer flight tracks and higher fuel consumption, the Reuters press agency said on Thursday.
The airline has suggested that “the subsidy for affected international flights is a good verifiable and fair option … The grant can be removed when the situation improves”.
Air India stressed that the closure requires the maximum impact on its operations, in particular due to “additional fuel burn … additional crew”. The ministry has not yet responded to this request.
The restriction of airspace comes after India suspended the Industry Water Treaty last week in response to a terrorist attack against tourists from the cashmere Pahalgam. In retaliation, Pakistan prevented Indian airlines from using its airspace – a movement that has forced transporters to reach several international flights.
The disturbance should considerably increase operating costs, with longer flight durations resulting in more fuel burns and additional crew expenses. Other Indian carriers are also preparing for a training effect as the confrontation continues.
Air India has been considerably affected by this aerial space ban because it operates many long-haul flights to Europe, the United States and Canada, frequently crossing the Pakistani airspace. The airline holds a market share of 26.5% in India and competes with a larger Indigo national rival.
In 2023-2024, Air India declared a net loss of $ 520 million on sales of $ 4.6 billion, partly attributed to the delays in Boeing and Airbus aircraft deliveries. The government is currently considering various options to mitigate the financial burden of the air industry due to the closure of airspace.
In response to the closure of the airspace, Air India also asked the government to negotiate with the Chinese authorities for surflux authorizations to use alternative routes. In addition, the airline requests approval to transport additional pilots on its flights to the United States and Canada, representing the increase in travel periods.
This operational adjustment aims to maintain the continuity of services in the middle of extended flight journeys. Indian carriers, including Air India, explore possibilities such as flying over difficult terrains near China and certain tax exemptions, as part of a collaborative approach with the Ministry of Civil Aviation.
