IATA Urges Pakistan and Bangladesh to Release Airline Revenues

The International Air Transport Association (IATA) has urged Pakistan and Bangladesh to release airline revenues totaling $720 million, which are being held in violation of international agreements. IATA, representing the global airline industry, highlighted the cumbersome repatriation process in Pakistan, calling for simplification to avoid unnecessary delays caused by audit and tax exemption certificate requirements. In contrast, Bangladesh was noted to have a more streamlined system, but aviation needs to be a higher priority for the central bank to facilitate foreign exchange access.

The situation has escalated, with airlines unable to repatriate over $720 million ($399 million in Pakistan and $323 million in Bangladesh) earned in these markets. Timely revenue repatriation is crucial for airlines to cover dollar-denominated expenses like lease agreements, spare parts, overflight fees, and fuel. Delaying repatriation not only violates international obligations but also heightens exchange rate risks for airlines.

IATA's regional vice president for Asia-Pacific emphasized the urgent need for Pakistan and Bangladesh to release the blocked funds immediately. He stressed that airlines operate on narrow profit margins and must prioritize markets based on the confidence in timely revenue remittance to cover expenses efficiently. Reduced air connectivity limits economic growth, foreign investment, and exports, underscoring the critical need for swift resolutions to unlock the substantial funds involved in the Pakistani and Bangladeshi markets.