Fri May 02 08:30:00 UTC 2025: ## Air India Faces $600 Million Loss Due to Pakistan Airspace Closure
**NEW DELHI** – Air India could face up to $600 million in additional costs over the next year due to Pakistan’s closure of its airspace to Indian airlines, according to a company letter obtained by Reuters. The closure, a response to the Pahalgam attack in India, is expected to remain in effect until May 23rd.
The increased costs stem from longer flight routes and increased fuel consumption. Air India estimates a loss exceeding $591 million annually while the ban persists. The longer flight times also negatively impact passenger experience.
The airline has requested government subsidies to offset these losses, citing the disproportionate impact on its operations compared to international carriers unaffected by the closure. Options under consideration by the Indian government include additional pilot allowances for longer flights, tax breaks, and potentially, exploring overflight clearances with China.
Other Indian airlines, such as IndiGo, are also experiencing increased flight times and costs. However, Air India, with its larger number of international flights that typically traverse Pakistani airspace, bears the brunt of the economic fallout. This adds to the airline’s existing challenges, with Air India reporting a net loss of $520 million in FY2023/24.
The Indian government, while vowing retribution for the Pahalgam attack, is reportedly aware of the economic ramifications for businesses in Kashmir and across the country. Neither Air India nor the Aviation Ministry has yet commented publicly on the situation.
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