Aviation industry in Pakistan faces crisis as airlines struggle to recover $290 million in dues

The aviation industry in Pakistan is facing a looming crisis due to the country’s dire financial situation, with airlines struggling to recover $290 million in dollar-based dues. The International Air Transport Association (IATA) has recognized the difficulty airlines are facing in serving Pakistan and retrieving their funds.

Philip Goh, IATA’s Asia-Pacific Director, commented on the significant delays airlines are experiencing before repatriating their funds, with some still having money stuck in Pakistan from sales made in 2022. In January, IATA reported that the amount of money stuck in Pakistan had increased by nearly a third from December.

Goh warned that if the conditions remained unsustainable, airlines would likely redirect their resources to other more profitable areas. According to Cirium statistics, foreign airlines have been hesitant to return to Pakistan, with fewer flights scheduled in March 2023 than in March 2019. As Mark Martin, the CEO of aviation consultancy Martin Consulting, stated, it is pointless to operate in a country where it is impossible to make a profit.