The International Air Transport Association(IATA), has warned that Airlines in India are likely to suffer a loss of 11.2 billion dollars this year, resulting in a risk of 2.9 million jobs. This has come as a consequence of a fall in passenger demand by 47% due to COVID-19.
The recent estimations from IATA show a worsening impact on the country due to the pandemic and travel restrictions Asia Pacific region.
On April 14, IATA released an updated analysis that indicated a drop in revenues by 314 billion dollars due to the COVID-19 crisis, which is a 55% decline as compared to 2019.
Airlines in the Asia Pacific are expected to see the largest revenue drop of 113 billion dollars in 2020 compared to 2019 (minus 88 billion dollars in March 24 estimate) and a 50 percent fall in passenger demand compared to 2019 (minus 37 percent in 24 March estimate).
All these figures have been formulated according to a situation where serious travel restrictions can prevail for three months with a gradual lifting of restrictions in domestic markets followed by regional and intercontinental.
“The situation is deteriorating. Airlines are in survival mode. They face a liquidity crisis with a 61 billion dollars cash burn in the second quarter,” Conrad Clifford, IATA’s Regional Vice President for Asia-Pacific said in a statement.
He further added that they have observed the first airline casualty in the region and the toll of casualties will increase if the government does not react to the situation and ensure that the airlines have sufficient cash flow to keep going in the current situation.
Clifford warned that if airlines do not survive this pandemic, it will impact many job sectors.
Airlines right now are performing an important function of providing essential items, including medical supplies. It is also helping in the repatriation of people who are deserted due to travel restrictions.