Flight ban no more
The UK's decision to remove Pakistan from its Air Safety List this week is a rare bright light in the aviation sector, especially relating to PIA, which was the only local airline still operating regular flights to the UK when the ban was imposed in 2020. The move will be a massive windfall for PIA, which was unable to capitalise on lucrative UK routes, losing customers to Middle Eastern competitors and later, British Airways.
The success of the latter shows that despite the high quality of service and relatively low prices of the Middle Eastern giants, there is still a significant market for direct flights. Indeed, prior to the shutdown, the UK routes were consistently among PIA's busiest and most lucrative flights.
The ban's origins were steeped in tragedy - the 2020 PIA crash in Karachi that killed 98 people, followed by the claims of then-aviation minister Ghulam Sarwar Khan that nearly one-third of Pakistani pilots held dubious licences. But although over 150 pilots were grounded for various licensing discrepancies, investigations cleared all except seven pilots who were then terminated.
The damage though had already been done, and it took four years for the EU to withdraw their ban last year - leading to the resumption of flights to Paris and the possibility of addition of other EU routes - and even longer for the UK ban to be withdrawn. The government is also eyeing restarting PIA flights to New York, and although this proposal still appears to be in its infancy, it helps make PIA all the more appealing to any potential suitors.
From a consumer perspective, the approval will probably not have an effect for several weeks, at the minimum, as re-authorisation of PIA's routes and reallocation of aeroplanes will take time. Other airlines will likely have to acquire additional long-haul aircraft if they want to start their own flights, which would take even longer and be more costly to set up. Still, the UK remains one of the most popular routes for expats and Pakistani tourists, and more competition on direct routes will benefit consumers, while also helping well-run local airlines grow.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Recorder
an hour ago
- Business Recorder
Pakistan's IT exports surge to all-time high of $3.8 billion in FY25
Pakistan's IT exports continued their strong growth trajectory, reaching a record high of $3.8 billion in the financial year 2024-25, driven by innovation and quality service delivery. According to the State Bank of Pakistan (SBP), exports of IT and IT-enabled services rose to $3.8 billion in FY25, up from $3.2 billion in the previous year—reflecting a year-on-year growth of 18%. The IT sector remained the third-largest source of foreign exchange for Pakistan, following the textile and rice sectors. It also accounted for the largest share—45%—of the country's total services exports by the end of FY25. Senior Vice Chairman of the Pakistan Software Houses Association (P@SHA), Muhammad Umair Nizam, said IT exports have shown consistent growth over the past several years, significantly contributing to the national economy, particularly in helping stabilize the current account, which recorded a surplus this fiscal year. He noted that Pakistan's IT sector could have earned even more foreign exchange if favorable policies had been introduced in a timely manner and if unpredictable national and global challenges had not emerged. He added that the IT industry, in collaboration with its representative body P@SHA and key government organizations—including the Ministry of IT and Telecommunication, Pakistan Software Export Board (PSEB), and the Special Investment Facilitation Council (SIFC)—is actively working to promote the domestic IT sector and boost exports. 'Once the government resolves outstanding challenges, IT companies will be better positioned to attract increased foreign exchange through exports,' Nizam said. In the last fiscal year, the government allowed IT companies to retain 50% of their foreign currency earnings in special forex bank accounts. It also introduced cash rewards for top exporters and addressed tax reporting issues. Mehwish Salman Ali, a member of P@SHA's AI Committee, said that export values can rise further through the adoption of cutting-edge technologies, offering advanced solutions to international markets to secure higher profit margins. She emphasized that Pakistani companies should accelerate innovation and cater to emerging demands, particularly in areas such as Artificial Intelligence, Machine Learning, and Cybersecurity. She also highlighted the importance of capacity building among IT professionals and fostering joint ventures with foreign companies in various regions. The government, along with IT companies, has made investments in promoting Pakistan's IT sector, showcasing its solutions and services in the Gulf, Europe, and ASEAN countries. Khushnood Aftab, Convener of the IT Committee at the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), stressed that the government should diversify not only export markets but also the range of IT products. He noted that while Pakistan currently exports IT hardware in limited volumes, innovation in technology could boost exports of hardware such as computers, laptops, and various devices. This would not only bring in foreign exchange but also foster technology transfer in the country. Aftab, who is also Chairman of Viper Group, said Pakistan could enhance its global reputation by promoting 'Made-in-Pakistan' IT hardware products. The government has set an ambitious target of $5 billion in IT exports for FY26, and $10 billion by FY29, under its Uraan Pakistan vision.
Business Recorder
3 hours ago
- Business Recorder
Abu Dhabi index gains on oil surge, Dubai falls on profit-taking
Abu Dhabi index closed higher on Friday, supported by an increase in oil prices after the European Union introduced new sanctions against Russia, while the Dubai index declined after investors moved to book profit on last five sessions' gains. The EU sanctions, aimed at punishing Moscow over its war in Ukraine, include fresh measures targeting the Russian oil and energy industry and lower the G7's price cap for buying Russian crude oil to $47.6 per barrel. Oil prices - a key catalyst for Gulf's financial market - rose 0.75% to reach $70.04 a barrel by 1106 GMT. Abu Dhabi's benchmark index recorded gains for the fourth session with the index finishing 0.2% higher, led by a 1.7% jump in Emirates Telecom Group, while its biggest lender First Abu Dhabi Bank added 0.5%. Dubai's main index meanwhile fell 0.2%, ending a five-day winning streak after reaching its highest level in 17 and a half years during the previous session. Losses were driven by a decline in financial sector stocks as Dubai's top lender Emirates NBD Bank dropped 2.4% after three consecutive session gains, while Commercial Bank of Dubai slumped 3.6%. However, budget airline Air Arabia rose by 0.8%, continuing its upward trend after Air Arabia Abu Dhabi announced plans to increase its operational capacity by 40% in 2025. The Dubai index saw profit-taking on Friday, but its sustained rally last week has pushed the index to a key resistance level. Next week's corporate earnings may provide the catalyst needed to break through this barrier, said Ahmed Negm, Head of Market Research MENA at Most Gulf markets in red Dubai's index went up 4.1% and Abu Dhabi's rose 2% in their fourth week of gains, according to LSEG data. Markets remain steady, supported by positive corporate earnings and stable oil prices, though global developments continue to have an impact on investor confidence, said Ahmed Negm. ----------------------------------- ABU DHABI up 0.2% to 10,262 DUBAI down 0.2% to 6,094 -----------------------------------
Business Recorder
4 hours ago
- Business Recorder
Tariff war must end quickly, German finance minister tells G7 partners
DURBAN: German Finance Minister Lars Klingbeil made clear in a meeting with his counterparts from the Group of Seven major economies on Friday that the global trade conflict must be ended quickly, he told reporters. 'But I also want to say very clearly: There will be no deal at any price, there should be no victory at any price,' Klingbeil said in Durban, South Africa, on the sidelines of the G20 finance chiefs meetings, where G7 ministers also met separately. Klingbeil called for a fair deal between the U.S. and Europe on tariffs. The 30% tariff on imports from European Union threatened by U.S. President Donald Trump would, if implemented, be a game-changer for Europe and a heavy blow for Germany with its export-oriented economy. Bundesbank President Joachim Nagel also warned of the 'great global damage' that the uncertainty from tariffs is causing. 'My appeal to the U.S. side is not to play games with the situation, because in the end, the prosperity of us all is at stake here,' Nagel said at the press event with Klingbeil. EU chief delays retaliation for US tariffs in search of deal The head of Germany's Bundesbank had warned on Thursday in an interview with Reuters that the tariff plans risk wiping out even a modest recovery in Europe's largest economy in the coming years. U.S. Treasury Secretary Scott Bessent did not attend the two-day G20 meeting in person, his second absence from a G20 event in South Africa this year, though he did join the G7 meeting online on Friday morning, according to Klingbeil. 'We were once again very much in agreement that we want to overcome existing problems, that in the end there should be a solution,' Klingbeil said, referring to his talks with ministers from the G7 nations. However, the EU is ready and willing to take determined countermeasures if a negotiated solution with the U.S. was not found, Klingbeil said. 'In the end, for me it is about protecting jobs and companies in Europe.' Brussels is discussing countermeasures if a deal is not reached by August 1, including the so-called anti-coercion instrument, which allows the bloc to retaliate against countries that put pressure on EU members to change economic policies. Asked about this instrument in an interview with Reuters on Thursday, Klingbeil said talks are now focusing on finding a joint solution with Washington, but if it doesn't work out, the EU will act 'united and decisively.'
