Cash-Strapped Pakistan Lost \$4.1 Billion in Just 2 Months After Closing Airspace to India, Official Data Reveals

Amid a significant diplomatic standoff, Pakistan shut its airspace to Indian flights after New Delhi halted the Indus Waters Treaty in response to the Pahalgam terror attack.

The ongoing tensions between New Delhi and Islamabad have dealt a heavy blow to Pakistan’s aviation sector. Pakistan’s Ministry of Defence informed the National Assembly that the Pakistan Airports Authority has suffered losses of PKR 4.1 billion in just over two months due to the closure of Pakistani airspace to Indian aircraft.

Between April 25 and June 30 alone, the losses amounted to PKR 1.4 billion. The airspace closure came as part of a major diplomatic escalation after New Delhi suspended the Indus Waters Treaty in response to the Pahalgam terror attack.

This isn’t the first time such a move has hurt Pakistan financially—back in 2019, a similar closure caused an estimated Rs 7.6 billion ($54 million) revenue loss. Despite the financial strain, the Pakistani government is defending its decision, with the Ministry of Defence stating that the measure falls within the jurisdiction of the federal government and carries “strategic and diplomatic weight.”

The ministry explained the move was aimed at “safeguarding civilians, protecting infrastructure, and allowing military planning,” stressing that while economic losses are inevitable, “sovereignty and national defence take precedence.”

Under the current restrictions, all Indian-registered, operated, owned, or leased aircraft—including military planes—are barred from entering or transiting Pakistani airspace. “No flight operated by Indian airlines or operators will be allowed to use Pakistani airspace,” the statement reiterated.

Meanwhile, India has extended its own airspace ban on Pakistani aircraft until August 24. This follows New Delhi’s April 30 decision to close its skies to all Pakistan-operated, owned, or leased flights, including military aircraft, as part of broader retaliatory measures after the April 22 Pahalgam terror attack, which claimed 26 lives.