Aviation Crisis' Looms In Pakistan

(MENAFN- Bangladesh Monitor)

An aviation crisis is looming in Pakistan as airlines are finding it increasingly difficult to recover their dues from the dollar-starved country.

According to a report by Financial Times, the International Air Transport Association (IATA) recently stated that it has become“very challenging” for carriers to serve Pakistan as they struggle to repatriate $290 million in dues, which are paid in dollars.
Pakistan's fast-depleting foreign exchange reserves currently stand at a measly $4.3bn.

The Pakistan Civil Aviation Authority (PCAA) has said it is trying to pay the airlines on time and has been in contact with relevant authorities over the issue.

The IATA, which represents some 300 airlines (comprising 83% of global air traffic), said $290 million were stuck in Pakistan as of January -- up by almost a third since December. The global aviation body stated that Pakistan had blocked $225 million it owed to international airlines in December 2022.

“Airlines are facing long delays before they are able to repatriate their funds,” IATA Asia-Pacific head Philip Goh was quoted as saying by FT.

“Some airlines still have funds stuck in Pakistan from sales in 2022," he said, adding that if the unstable economic situation persists then many airlines might decide to utilise their aircraft "elsewhere".

Last month, Virgin Atlantic announced the suspension of announced the suspension of its operations in Pakistan. Though the airlines said the decision was part of its plan to revamp operations, analysts believe unstable economic conditions spurred the company to shut shop.

Citing data from an aviation analytics company, the FT report
stated that fewer total flights were scheduled for March 2023 than the same month in 2019.



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