KARACHI: Pakistani Prime Minister Imran Khan has ordered that bilateral Air Service Agreements (ASAs) with foreign airlines, including from Gulf countries, be revised to safeguard Pakistan’s local industry, the civil aviation authority said on Saturday.
Pakistan is currently in the process of finalizing its National Aviation Policy (NAP) 2019, which will include a reduction of Rs4 billion in charges from the Civil Aviation Authority (CAA) to the domestic aviation sector.
The government wants to review open skies clauses and associated ASAs under the revised National Aviation Policy, including renegotiating routes, slots and capacity accorded to foreign airlines that might be discriminatory and disadvantageous to the national flag carrier, Pakistan International Airlines (PIA).
At present, Pakistan has ASAs with 98 countries which are subject to periodic renegotiations.
“We are mandated by the federal government for the review of the aviation policy with foreign airlines,” Secretary Aviation and CAA Board Chairman Shahrukh Nusrat told media at a news conference on Saturday. “We have received orders from Prime Minister Imran Khan [who has asked us] to review bilateral Air Service Agreements with all gulf [countries’] airlines.”
He added that talks with Qatar Airlines would kick off on the 2nd and 3rd of May.
Pakistan liberalized its aviation sector in 2015 by opening its skies to foreign airlines and increasing the number of international flights to Pakistan, thereby also slicing off a large share of the national carrier’s revenue. Gulf countries’ airlines benefited most from the liberalization.
PIA spokesman Mashood Tajwar told Arab News that the review, if it materialized, was expected to increase the business revenue of PIA to the tune of billions of rupees.
But aviation experts called the review impractical because no country would agree to reduce its market share.
“The perception that flights from gulf country airlines will be reduced is not logical. Only through bilateral negotiations can the ASAs be reviewed due to international obligations; no country can unilaterally force it,” Afsar Malik, an aviation expert, told Arab News on Saturday. “The implication of ending a bilateral ASA with a country will be that we will end direct air travel services to that country. It will also constitute a diplomatic setback.”
CAA’s Nusrat admitted that while it would be “very difficult” to conduct such negotiations, he said bilateral agreements meant Pakistan had a right to discuss loss and benefits to it with other states.
“Whatever is right for the country, we are going to do that,” Nusrat said, adding that the new aviation policy would provide a relief of Rs4 billion to local players and increase ease of doing business and reduce costs.
“Under the policy, the tax that the CAA charges has been rationalized and taken to almost zero for the domestic services, while Federal Excise Duty that the Federal Board of Revenue charges will be reduced,” Nusrat said.
