Air India faces ‘$600m hit’ as Pakistan airspace closure forces flight reroutes
May 4, 2025
Air India is facing projected annual losses of over $591 million due to Pakistan’s ongoing closure of its airspace to Indian carriers, according to a company letter obtained by Reuters.
The restriction, triggered by heightened diplomatic tensions following the Pahalgam attack, has forced Air India to reroute international flights, significantly increasing operating costs.
The airline warned that longer flight times and fuel burn, coupled with additional crew demands, would not only push up expenses but also affect the passenger experience. “Impact on AI is maximum due to airspace closure, additional fuel burn, crew,” the letter stated. The financial burden could reach up to $600 million over the next year if the airspace remains shut.
While the restriction, expected to last until at least 23 May, applies only to Indian airlines, it disproportionately affects Air India, which operates the largest number of international services using Pakistani airspace.
Routes to the Middle East from Delhi are now expected to take at least an hour longer, the airline said.
In response, Air India has written to India’s Aviation Ministry requesting financial support to offset the mounting costs. “Subsidy for affected international flights is a good, verifiable and fair option … the subsidy can be removed when the situation improves…” the letter said.
No official comment has been made by either Air India or the aviation ministry.
