Disruption in service and loss faced by Pakistan’s

aviation sector due to Covid-19 outbreak

Prepared for
Sir Bilal Saleem Goreja

Prepared by
M. Awais Saleem – SP19-BBA-197

M. Abdur Rahman Khan – SP19-BBA-191

M. Abdul Rafay – SP19-BBA-189

M. Saad Hassan – SP19-BBA-209

Javeria Javed – FA18-BBA-053

Date
April 13th, 2020

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Disruption in service and loss faced by Pakistan’s aviation sector due to Covid-19 outbreak

Executive summary

The outbreak of Covid-19 has caused a huge disruption in the aviation sector of Pakistan, hitting

PIA the most. Among the problems faced by passengers, the other concern is of the loss faced by

the airline due to flight restrictions from rest of the world, including Saudi Arabia regarding the

Umrah flights. The aim of this report is to shed a light on the disturbance in the flight schedule,

the closure of international destinations of PIA, the loss faced and what future does aviation has

in Pakistan. The disruption has caused a loss of over Rs10 billion in the month of March alone

with the prediction of loss reaching to about Rs25 Billion towards the end of the ban. Although

this crisis is inevitable, airlines can conduct special operations to bring back stuck people, as well

as cut the number of employees and lessen the number of operating aircrafts to lower their

operating costs.

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Disruption in service and loss faced by Pakistan’s aviation sector due to Covid-19 outbreak

Table of contents

1. Introduction.................................................................................................................4

1.1. Background…………………………………………………………………...4

1.2. Purpose..............................................................................................................4

1.3. Significance of the study……………………………………………………...5

1.4. Scope of the study…………………………………………………………….5

1.5. Limitations of the study……………………………………………………....5

2. Review of Related Literature……………………………………………………….6

3. Methods of the study………………………………………………………………...7

3.1. Sample Selection………………………………………………………...........7

3.2. Data Collection………………………………………………………………..7

3.3. Statistical method……………………………………………………………...7

4. Discussion and Results……………………………………………………………….8

5. Conclusion……………………………………………………………………………11

6. Recommendations……………………………………………………………………12

7. References…………………………………………………………………………….13

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Disruption in service and loss faced by Pakistan’s aviation sector due to Covid-19 outbreak

Introduction

In a country, the aviation is an important industry when it comes to aerial transportation. Not

only does it assist in getting transportation done in a very short time in an efficient way, but it

also plays a vital part in the economic growth of that country. In Pakistan, aviation sector plays

an important part in the commercial and cargo transport/logistics both domestically and

internationally with a reliable system of air traffic flying extensively throughout the county.

1. Background

Initially when the Covid-19 started spreading in Wuhan in December, many carriers who were of

the foreign origin flew back to their home countries and took the virus with them. Consequently,

the coronavirus started spreading at a devastating pace and was declared as a pandemic. To

prevent from further rapid spread globally, the first step that the countries took was to impose

ban on inward/outward travel. The first victim of this ban was the global aviation sector,

including Pakistan’s and many problems rose for the sector itself and for the people who used

airlines for travel.

2. Purpose

Due to the ban on domestic/international flights, there have been too many problems for the

people who had scheduled their travel in this period, and for the airlines who are bearing a huge

loss after the travel ban. The purpose of the report is to emphasize on the disruption of the

service caused due to the suspension of the domestic and international flights, and the flight

suspension in those countries which are a regular destination of PIA due to flight restrictions in

rest of the world, and how it is affecting travelers. We will also take a brief look into the loss that

the airlines and Aviation sector in general is facing and what measures can be taken.

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Disruption in service and loss faced by Pakistan’s aviation sector due to Covid-19 outbreak

3. Significance of the Study

The change of situation all over the world due to pandemic has affected every aspect of life and

routine activities have been delayed. This includes the travel activities and plans of people as

well. The purpose of this report is to educate people on how the Covid-19 has disrupted the flight

schedule of Pakistan and the countries PIA flies to, and how people who are planning to travel or

are stuck in other countries/away from their place of origin can react to this situation and take

contingency measures. Moreover it will state the loss that the airlines are bearing and what can

they do about it till the situation of travel ban changes.

4. Scope of the Study

The report includes the information about the Loss and service disruption by the aviation sector.

Following is the scope of the study that is conducted:

 The report only includes information about Pakistan’s commercial aviation and airlines.

 Flight data of most of the international routes of PIA has been used but no foreign airline

is included.

 The loss of PIA and aviation sector in general would be discussed.

5. Limitations of the Study

The study has the following limitations:

 The report doesn’t cover the disruption and losses faced by Pakistan’s local Airlines.

 The figures of loss is an estimated number by the aviation department.

 The estimated future loss might not be 100% accurate because the numbers are based on

predictions by aviation department.

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Disruption in service and loss faced by Pakistan’s aviation sector due to Covid-19 outbreak

Review of Related Literature

There are reports from national/international sources on the airlines issue of Pakistan. According

to Reuters (2020) after the outbreak, “Pakistan has suspended all international flights for two

weeks to limit the spread of coronavirus, as governments across densely populated south Asian

countries ramp up their efforts to contain the virus”. A lot of Pakistan’s air traffic goes to Saudi

Arabia for the pilgrimage, but Covid-19 changed that situation. Chaudhary (2020) states that

“Amid Saudi Arabia suspending Umrah over coronavirus outbreak, the Pakistan International

Airlines (PIA) has suffered losses of approximately Rs2 billion.” This gives us an insight into the

loss that PIA had to bear due to suspension of Umrah tickets alone. It also affected the aviation

sector financially in general. Ahmed (2020) stated that “According to a report sent to Prime

Minister Imran Khan by the Aviation Division, the Pakistan International Airlines (PIA) – the

national flag carrier – has so far witnessed a loss of over Rs7 billion while the Civil Aviation

Authority (CAA) has suffered a loss of Rs3.5 billion since beginning of March”. This puts the

financial future of aviation sector in an uncertain position.

Due to the travel restrictions, a lot of Pakistanis are stuck in the other countries. Looking at the

data of UAE, Ashfaq Ahmed (2020) stated that “According to Pakistani diplomatic missions,

more than 25,000 Pakistanis - mostly those who came on visit/tourist visas but stranded here

after the flight restrictions - have registered demanding to go back home at the earliest”. Yet the

special flights are not conducted due to safety, permissions and restriction issues. Times (2020)

tells the statement of Pilot’s association on the situation that “The safety and health of our crew

members has always been and remains our utmost priority. PALPA will in no circumstances

compromise on the safety of its members”, which makes the problem of expatriates stuck outside

the country even worse.

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Disruption in service and loss faced by Pakistan’s aviation sector due to Covid-19 outbreak

Methods of Study

The following components are used while constructing the report.

1. Sample Selection

To measure the disruption in the service of airlines of Pakistan, the data of the cancelled flights

(domestic and international) and flight status of PIA has been taken. The flight data of various

international destinations of PIA has been taken into account as well.

For the amount of loss that the sector is bearing, the data of PIA in particular and the Aviation

sector in general has been taken.

2. Data Collection

The flight data of PIA and its international destinations has been taken from various online

sources which are used to track flight statuses and statistics, as well as renowned sources like

World Economic forum.

For the amount of loss PIA and aviation sector is facing, the data is taken from the report sent to

PM by aviation department, and the predicted number from the officials of the department.

3. Statistical Methods

No statistical method in particular has been used for the study, the numbers provided by the

journalists and the official data has been used for the construction of this report.

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Disruption in service and loss faced by Pakistan’s aviation sector due to Covid-19 outbreak

Discussion and Results

Due to the outbreak of corona virus, there has been a huge amount of disruption in the flight

schedule of almost every airline in the world. Pakistan having a reliable and functioning aviation

sector is no different from the rest of the world. All the domestic flights, as well as the

international flight operation has been halted. The reason behind this is not only the travel

restriction by Pakistan, but the restrictions imposed by other countries as well.

1: The halt in PIA's flight schedule due to travel restrictions (Radar Box)

Because of this, many regular flight destinations of PIA are also facing a similar disruption. The

weekly flights to destinations like UAE, Canada, Italy, China and Kuwait have been suspended

for an uncertain period of time because many countries have given different time frames for their

travelling restrictions. Moreover, the govt. of Saudi Arabia has also imposed Umrah restrictions

due to the danger of Covid-19 spread. Because of this, 60 weekly flights scheduled to Saudi

Arabia have been suspended as well

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Disruption in service and loss faced by Pakistan’s aviation sector due to Covid-19 outbreak

2: Change in the number of flights of a few PIA's international destinations (World Economic Forum)

One of the biggest problem for the passengers because of the restrictions is that there is a high

number of expatriates from Pakistan who are stuck in the other countries and are helpless since

there is no way they can get back to the country. FlyDubai from UAE opened its sales to

Pakistani citizens stuck in UAE but the Embassy denied any sort of permission and involvement

in it from the Govt. of Pakistan. Moreover pilot association has also restricted its members from

flying to any destination amid Covid-19 risks.

3: Out of 33 airplanes of PIA, only 2 are operating under special circumstances (Flight Aware)

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Disruption in service and loss faced by Pakistan’s aviation sector due to Covid-19 outbreak

While there has been a disruption in flight schedule, it also came with some unavoidable

consequences. Due to the grounding of airlines, many airlines are predicted to go into

bankruptcy. PIA who is already operating under loss is also expected to face the similar

situation. Due to the restrictions on Umrah by KSA, 50,000 scheduled flight tickets have been

suspended by PIA, causing a loss of over Rs2 billion. According to report sent to PM by aviation

department, the Aviation sector faced a loss of Rs10 billion (7 billion for PIA and 3 billion for

rest of aviation) in the Month of March alone due to travel restrictions imposed in and outside

Pakistan. Moreover, officials have revealed that in the period of restrictions, the sector can face a

loss of more than Rs25 Billion. While this situation is unavoidable, experts further predicted that

in the worst case scenario, the flight operation all around the world can take years to reach its

former level, which is also alarming for Pakistan’s aviation sector.

4: The fall in the no. of commercial flights since the Covid-19 restrctions worldwide (Flight Radar24)

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Disruption in service and loss faced by Pakistan’s aviation sector due to Covid-19 outbreak

Conclusion

From our discussion, we can observe that due to the problem of Covid-19, the airlines and flight

schedule of Pakistan is highly disturbed. But this is not only limited to the Pakistan, as the

aviation sector of whole world is facing a similar crisis since the travel restrictions are being

practiced globally. But one of the biggest negative impact of the crisis is on the people, who are

stuck away from their countries of origin like many other Pakistani passengers. But nothing is

done about it because of halt in the service due to safety reasons.

We can also observe the loss that is faced by Pakistan’s aviation and PIA in particular. Closure

of air spaces as well as Umrah restrictions from a regular destination is a big problem for an

airline that is already facing financial crisis.

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Disruption in service and loss faced by Pakistan’s aviation sector due to Covid-19 outbreak

Recommendation

Although Covid-19 is a natural crisis and nothing can be done in this aspect, there are some

immediate/long term decision that both Airlines and passengers can take.

 Passengers who were travelling need to reschedule their travelling.

 Special flights should be conducted for the Pakistanis stuck in other countries. This will

not only help them, but would get some of the money for the airline as well.

 Airlines can cut the number of employees they have and should pay the remaining

employees a margin of what they are paid to avoid financial crisis.

 Once the ban is lifted, PIA can only fly few of their aircrafts to lessen operational cost.

 Airlines should start using contactless technology for payment and minimize the waiting

time to deal with further situations like this.

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Disruption in service and loss faced by Pakistan’s aviation sector due to Covid-19 outbreak

References

Ahmed, W. (2020). Aviation sector faces Rs10b loss due to pandemic in Pakistan | The Express

Tribune. Retrieved 12 April 2020, from https://tribune.com.pk/story/2179091/2-aviation-

sector-faces-rs10b-loss-due-pandemic-pakistan/

Ahmed, W. (2020). Economic fallout: Pakistan's aviation sector braces for Rs25b loss amid

COVDI-19 travel ban | The Express Tribune. Retrieved 12 April 2020, from

https://tribune.com.pk/story/2182013/2-economic-fallout-pakistans-aviation-sector-

braces-rs25b-loss-amid-covdi-19-travel-ban/

Airport, I. (2020). Live Pakistan International Airlines Corporation Flight Status - FlightAware.

Retrieved 12 April 2020, from https://flightaware.com/live/fleet/PIA

Ashfaq Ahmed, A. (2020). COVID-19: Flydubai opens ticket sales to Pakistan but Pak Embassy

denies any government permission. Retrieved 12 April 2020, from

https://gulfnews.com/uae/covid-19-flydubai-opens-ticket-sales-to-pakistan-but-pak-

embassy-denies-any-government-permission-1.70855951

Chaudhary, W. (2020). COVID-19: PIA suffers Rs2b loss amid Umrah restrictions by KSA | The

Express Tribune. Retrieved 12 April 2020, from https://tribune.com.pk/story/2173107/3-

covid-19-pia-suffers-rs2b-loss-amid-umrah-restrictions-ksa/

Ghosh, I. (2020). This chart shows how airlines are being grounded by COVID-19. Retrieved 12

April 2020, from https://www.weforum.org/agenda/2020/03/this-chart-shows-how-

airlines-are-being-grounded-by-covid-19/

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Disruption in service and loss faced by Pakistan’s aviation sector due to Covid-19 outbreak

LLC, A. (2020). AirNav RadarBox - Live Flight Tracker and Airport Status. Retrieved 12 April

2020, from https://www.radarbox.com/data/airlines/PIA#

Radar24, F. (2020). Live Flight Tracker - Real-Time Flight Tracker Map | Flightradar24.

Retrieved 12 April 2020, from https://www.flightradar24.com/data/statistics

Reuters, T. (2020). Pakistan suspends international flights for two weeks. Retrieved 12 April

2020, from https://www.theguardian.com/world/2020/mar/21/pakistan-suspends-

international-flights-for-two-weeks-to-stem-covid-19-spread

Times, D. (2020). COVID-19: PALPA stops pilots from operating special flights. Retrieved 12

April 2020, from https://dailytimes.com.pk/589814/covid-19-palpa-stops-pilots-from-

operating-special-flights/

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