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India is yet to take any decisive or effective action to help airline industry: IATA

April 4, 2020: The International Air Transport Association (IATA), while its request to Asia-Pacific states to take urgent action to provide financial support to their airline industry impacted by the COVID-19 crisis, noted that India hasn’t taken any decisive or effective action in this direction yet.

IATA is estimating that 68.5 million passengers will be lost, 2.2 million people will lose their jobs, $12.7 billion shrinkage in GDP and $8.8 billion revenue loss for the country%u2019s airline industry.
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IATA is estimating that 68.5 million passengers will be lost, 2.2 million people will lose their jobs, $12.7 billion shrinkage in GDP and $8.8 billion revenue loss for the country%u2019s airline industry.

April 4, 2020: The International Air Transport Association (IATA), while repeated its request to Asia-Pacific states for urgent action with financial support to their airline industry impacted by the COVID-19 crisis, noted that India hasn’t taken any decisive or effective action in this direction yet.

Conrad Clifford, regional vice president, Asia-Pacific, IATA said “Australia, New Zealand and Singapore have announced a substantial package of measures to support their aviation industry. But others in the region, including India, Indonesia, Japan, Malaysia, the Philippines, Republic of Korea, Sri Lanka and Thailand, have yet to take decisive and effective action. Jobs, as well as the GDP supported by the industry, are at risk.”

IATA’s India estimations
With Covid-19 pandemic crisis affecting India, IATA is estimating 68.5 million loss in passengers, 2.2 million loss in jobs, $12.7 billion shrinkage in GDP and $8.8 billion loss in revenue in the country airline industry.

IATA’s Asia-Pacific estimations
Major Asia-Pacific states could see passenger demand in 2020 reduced by between 34% to 44%. This is based on a scenario where severe restrictions on travel are lifted after 3 months, followed by gradual recovery. Cambodia (-34%), Vietnam (-34%) and the Philippines (-36%) will be on the lower end of the range, while Thailand (-40%), Pakistan (-40%), Republic of Korea (-40%) and Sri Lanka (-44%) will see the largest impact.

“Based on a scenario in which severe travel restrictions last for three months, the Asia-Pacific region as a whole will see passenger demand reduced by 37% this year, with a revenue loss of US$88 billion. While each country will see varying impact on passenger demand, the net result is the same – their airlines are fighting for survival, they are facing a liquidity crisis, and they will need financial relief urgently to sustain their businesses through this volatile situation,” said Clifford.

Global scenario
In its latest analysis, IATA expects airlines around to post a net loss of US$39 billion during the second quarter ending 30 June 2020. The impact of that on cash burn will be amplified by a US$35 billion liability for potential ticket refunds. Without relief, the industry’s cash position could deteriorate by US$61 billion in the second quarter

“Governments need to ensure that airlines have sufficient cash flow to tide them over this period, by providing direct financial support, facilitating loans, loan guarantees, and support for the corporate bond market. Taxes, levies, and airport and aeronautical charges for the industry should also be fully or partially waived. It is critical that these countries still have a viable aviation sector to support the economic recovery, connect manufacturing hubs and support tourism when the COVID-19 crisis is over. They need to act now – and urgently - before it is too late,” said Clifford.

NATION

PERCENTAGE CHANGE IN PASSENGER DEMAND

PASSENGER DEMAND IMPACT (ORIGIN-DESTINATION VOLUMES)

REVENUE IMPACT (US$, BILLIONS)POTENTIAL JOBS IMPACTPOTENTIAL GDP IMPACT (US$, BILLIONS)
India
-36%
-68,555,000
-8,838
-2,247,000
-12,709
Australia
-39%
-38,366,000
-11,146
-278,200
-27,012
Bangladesh
-37%
-4,218,000
-842
-47,200
N/A
Bhutan
-32%
-167,800
-19
N/A
N/A
Brunei
-38%
-459,500
-89
-6,400
-352
Cambodia
-34%
-4,072,000
-677
-581,700
-1,595
Fiji
-39%
-877,400
-238
-49,300
-854
French Polynesia
-41%
-580,300
-244
N/A
N/A
Indonesia
-37%
-45,354,000
-6,433
-1,570,000
-8,999
Japan
-38%
-71,575,000
-17,765
-448,600
-34,962
Laos
-39%
-1,226,000
-171
-18,000
N/A
Malaysia
-39%
-25,493,000
-3,317
-169,700
-3,799
Maldives
-40%
-2,124,000
-507
-28,800
-1,236
Myanmar
-36%
-3,313,000
-540
-185,600
-685
Nepal
-39%
-2,607,000
-409
-175,100
N/A
New Caledonia
-41%
-386,700
-125
N/A
N/A
New Zealand
-38%
-9,769,000
-2,650
-128,300
-8,141
Pakistan
-40%
-7,540,000
-1,438
-198,200
N/A
Papua New Guinea
-42%
-961,700
-201
-17,300
N/A
Philippines
-36%
-21,878,000
-3,507
-419,800
-3,747
Solomon Islands
-39%
-104,200
-30
-11,500
-59
Republic of Korea
-40%
-45,142,000
-8,432
-287,700
-16,402
Sri Lanka
-44%
-3,105,000
-562
-313,000
-3,507
Thailand
-40%
-42,470,000
-6,516
-1,663,300
-25,118
Vanatatu
-35%
-205,600
-35
-3,700
-50
Vietnam
-34%
-24,171,000
-3,404
-749,700
-4,282
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