According to Dawn, citing the Financial Times on Thursday, the International Air Transport Organization has issued a warning about an “aviation crisis” in Pakistan, as airlines struggle to collect USD 290 million as a result of a severe financial crunch. Has been The Pakistan Civil Aviation Authority (PCAA) has said that it is in touch with the appropriate authorities and is working to make timely payments to the airlines.
According to the Dawn report, the Financial Times quoted the International Air Transport Association (IATA) as saying that serving Pakistan has become “very challenging” for carriers as they struggle to recover their dues paid in dollars. are doing.
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IATA, which represents about 300 airlines comprising 83 per cent of global air traffic, said USD 290 million was stuck in Pakistan as of January, an increase of nearly a third since December.
“The airlines are facing long delays before they are able to refund their funds,” Philip Goh, IATA’s Asia-Pacific head, told the FT. “Some airlines still have money stuck in Pakistan from sales in 2022.”
The outstanding dues have reached USD 290 million, Dawn wrote, citing a report in the Financial Times. “If conditions persist that make the economics of a country’s operations unsustainable, one would expect airlines to put their valuable aircraft assets to better use elsewhere,” Goh said.
Speaking to Dawn, PCAA DG Khaqan Murtaza confirmed that the airlines are facing some delay in repatriation of their payments, but added that the authority is taking up with the State Bank and the Finance Minister for timely payment to the airlines. was in touch.
According to Dawn, in December 2022, the global aviation body said Pakistan has blocked USD 225 million worth of international airlines, making it one of the top markets where airline funds have been blocked from repatriation.
The development coincided with Pakistan’s balance of payments crisis with rapidly depleting foreign exchange reserves, which stand at an all-time low of USD 4.3 billion. The ongoing crisis has also affected the aviation industry where airlines sell tickets in local currency but return dollars to pay for expenses. such as fuel cost.
Foreign airlines have been reluctant to return to Pakistan, with fewer flights scheduled in March 2023 than in the same month in 2019, the FT shared, citing data from aviation analytics company Cerium.
“If you can’t get money out of a country, there’s no point in going there,” Mark Martin, chief executive of aviation consultancy Martin Consulting, told the FT report.
Last month, Virgin Atlantic announced the suspension of its operations in Pakistan. While the airline said the decision was part of a plan to restart operations, the FT cited a person familiar with the matter as saying the decision was based on Pakistan’s economics. Way.
Earlier this month, the Senate Standing Committee on Aviation recommended the aviation ministry to hold a meeting with airline chiefs and persuade them to address negative perceptions about Pakistan and resume operations as usual.
(With ANI inputs)