Pakistan struggles to pay global airlines

Pakistan Civil Aviation Authority (PCAA) has said it was trying to pay the airlines on time and has been in contact with relevant authorities over the issue, Dawn reported. The Financial Times, while quoting the International Air Transport Association (IATA) said it has become "very challenging" for carriers to serve Pakistan as they struggle to repatriate their dues which are paid in dollars.

The global air transport body has warned of an "aviation crisis" in Pakistan as airlines are struggling to recover $290 million due to a severe financial crisis.

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

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The Financial Times, while quoting the International Air Transport Association (IATA) said it has become "very challenging" for carriers to serve Pakistan as they struggle to repatriate their dues which are paid in dollars.

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The IATA, which represents some 300 airlines comprising 83 per cent of global air traffic, said $290m were stuck in Pakistan as of January up by almost a third since December, Dawn reported.

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

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"Some airlines still have funds stuck in Pakistan from sales in 2022. If conditions persist that make the economics of operation to a country unsustainable, one would expect airlines to put their valued aircraft assets to better use elsewhere," Goh added.

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The FT citing data from an aviation analytics company Cirium, shared that foreign airlines have been reluctant to return to Pakistan, with fewer total flights scheduled for March 2023 than the same month in 2019.

"If you can't take money out of a country, then there's no point in you even going there," said Mark Martin, chief executive of aviation consultancy Martin Consulting, in the FT report.

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