Airlines in India are likely to suffer a revenue loss of 11.2 billion dollars this year leading to 2.9 million jobs at risk as passenger demand falls by 47 per cent due to COVID-19 crisis, the International Air Transport Association (IATA) said.
The latest estimates from IATA indicate a worsening of the country impact from coronavirus pandemic and travel restrictions in the Asia Pacific region.
On April 14, IATA released an updated analysis showing that the COVID-19 crisis will see global airline passenger revenues drop by 314 billion dollars in 2020, a 55 per cent decline compared to 2019.
Airlines in the Asia Pacific will 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 per cent fall in passenger demand compared to 2019 (minus 37 per cent in 24 March estimate).
These estimates are based on a scenario of severe travel restrictions lasting 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," said Conrad Clifford, IATA's Regional Vice President for Asia-Pacific. "We have seen the first airline casualty in the region. There will be more casualties if governments do not step in urgently to ensure airlines have sufficient cash flow to tide them over this period," he said in a statement.
Clifford identified India, Indonesia, Japan, Malaysia, the Philippines, South Korea, Sri Lanka and Thailand as priority countries that need to take action. In India, passenger demand in 2020 is estimated to fall by 47 per cent to 89.7 million.
IATA called for a combination of direct financial support, loans, loan guarantees and support for the corporate bond market, and tax relief. "Providing support for airlines has a broader economic implication. Jobs across many sectors will be impacted if airlines do not survive the COVID-19 crisis," said Clifford.