Home Business Airspace closure causing global disruptions and financial losses

Airspace closure causing global disruptions and financial losses

“Both airspaces were closed in a tit-for-tat move. It hurt civil aviation businesses not only of India and Pakistan but of many other countries and commercial aviation companies”

 

 

CAA has suffered a loss of Rs 8.5 billion, owing to airspace restrictions since February 2019 in the wake of aftermaths of Indian transgress

 

 

 

 

PTI government has made a U-turn in just five days on allowing Indian planes use its airspace. This is a welcome move, which was reciprocated by India in the same measure. But more than being a “goodwill gesture” from the Imran Khan, the about-turn by Pakistan on airspace is because of harsh economic realities.

On July 11, Aviation Secretary of Pakistan Shahrukh Nusrat told a parliamentary committee that it would not open its airspace for Indian use until India withdraws its fighter jets from forward positions. Nusrat is also the Director General of the Civil Aviation Authority (CAA) of Pakistan.

India did not agree to Pakistan’s demand. Yet, Pakistan unilaterally issued a midnight notice to airmen (NOTAM) stating that “with immediate effect Pakistan airspace is open for all types of civil traffic on published ATS (air traffic service) routes.”

Much has been written about the Indian civil aviation sector losing money due to the closure of the Pakistani airspace. The same day when Pakistan’s aviation secretary put a precondition for withdrawing the ban on Indian use of the airspace, Civil Aviation Minister Hardeep Puri told Parliament that India spent an extra Rs 430 crore due to route diversion.

Indian flights were forced to take a longer route to avoid Pakistan airspace. Puri had told the Rajya Sabha that total loss caused by the closure of Pakistani airspace was about Rs 550 crore (Rs 491 crore to Air India, Rs 30.73 crore to SpiceJet, Rs 25.1 crore to IndiGo and Rs 2.1 crore to GoAir).

But loss of revenue was far greater for a fragile economy like Pakistan. Operations of around 400 flights a day were affected due to closure of airspace by Pakistan. Federal Minister for Aviation Ghulam Sarwar Khan has said that Pakistan Civil Aviation Authority has suffered a loss of Rs 8.5 billion, owing to airspace restrictions since February 2019 in the wake of aftermaths of Indian transgress.

But this closure hit Indian Aviation drastically hard as compare to Pakistan; he apprised the loss margin of India is almost double. “But at this juncture of time, détente and harmony is required from both sides”, he remarked.

Pakistan earns good money from route navigation and airport charges levied on flights using its airspace or landing for maintenance or refueling. These charges vary according to the size and class of aircraft.

For a regular Boeing 737 passenger aircraft, Pakistan charges around $600-$700 a day for allowing use of its airspace for terminal navigation and landing. For about 400 flights using its airspace, Pakistan could be earning around $3,00,000 a day.

Besides, Pakistan’s aviation sector has a high demand for destinations in South and Southeast Asia. Some reports suggest that Pakistan International Airlines suffered more than $450,000 a day due to closure of Indian airspace for its use as flights to places like Kuala Lumpur and Bangkok were suspended. An available longer route made PIA flights unviable. The combined loss of the PIA and CAA was estimated to be $100 million.

International pressure was also in the play especially in the backdrop of rising tension between the US and Iran. The Federal Aviation Administration (FAA) of the US had advised aircraft to stay away from operating “in the overwater area of the Tehran Flight Information Region until further notice, due to heightened military activities and increased political tensions.”

Flights from India have taken this route for destinations in Central Asia and Europe after closure of Pakistani airspace. Indian Prime Minister Narendra Modi had used this route when he went to attend Shanghai Cooperation Organisation Summit in Kyrgyzstan. Though Pakistan had offered to open its airspace for PM Modi’s travel, he did not fly over the country.

Speculation is that the US might have played a role in opening of Pakistani airspace for India. It had not reimposed the restrictions after July 12, when the ban revised on June 30 ended.

Pakistan and India closed their airspaces to each other in February in the aftermath of Pulwama and Balakot incidents. Indian Air Force pilot Abhinandan Varthaman, who landed in Kashmir after MiG fighter was shot down. Imran Khan released Abhinandan Varthaman for goodwill gesture and to deescalate tension.

Both airspaces were closed in a tit-for-tat move. It hurt civil aviation businesses not only of India and Pakistan but of many other countries and commercial aviation companies. Airspaces have opened after 140 days.

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