The COVID-19 pandemic which has brought the aviation industry in India to a standstill could lead to a loss of about 20 lakh jobs, according to the the International Air Transport Association (IATA).
The Centre on April 14 suspended all commercial flights till May 3, after Prime Minister Narendra Modi announced an extension to the nationwide lockdown which has been in place since March 25. The lockdown has led to severe challenges and turbulence in business conditions as some airlines have already started to retrench its employees or asked them to take leave without salaries.
The IATA on Wednesday said that all airlines now face an existential crisis globally and Indian aviation has not been spared.
‘Passenger revenue is expected to fall by more than $8.8 billion and passenger demand decline by 36% in India,’ IATA Assistant Director for Corporate Communications (Asia Pacific) Albert Tjoeng said. ‘This puts over 2 million jobs at risk, including sectors that are dependent on aviation.’
Tjoeng suggested that the Indian government should partially waive taxes and aeronautical charges for the aviation industry. He said that the government should also ensure that airlines have enough cash flow, by providing loans, direct financial support, loan guarantees and support for the corporate bond market.
Airlines are facing a liquidity crisis, burning USD 61 billion of their cash reserves in the second quarter of 2020, he added.
On Tuesday, IATA Director General and CEO Alexandre de Juniac said that the industry’s outlook is growing darker by the day.
‘The scale of the crisis makes a sharp V-shaped recovery unlikely. Realistically, it will be a U-shaped recovery with domestic travel coming back faster than the international market. We could see more than half of passenger revenues disappear. That would be a USD 314 billion hit,’ he said.
He had also claimed that airlines could burn through USD 61 billion of cash reserves in the second quarter itself. ‘That puts at risk 25 million jobs dependent on aviation. And without urgent relief, many airlines will not survive to lead the economic recovery,’ he had said.
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