• Air India estimates $600 million in additional costs from Pakistan's airspace ban.
• The airline requested a financial subsidy from the Indian government.
• Pakistan's airspace closure follows a terror attack in Kashmir.
• Longer flight durations and increased fuel expenses are expected.
• Air India seeks overflight clearances to mitigate economic losses.

Air India expects to incur approximately $600 million in additional costs if the ban from Pakistan's airspace lasts for a year. The airline has submitted a request for compensation to the Indian government, outlining the financial impact of this closure. The increase in expenses is attributed to higher fuel costs and longer journey times resulting from the airspace restriction, which follows a retaliatory measure after a terror attack in Kashmir that killed 26 individuals, including a foreign tourist from Nepal, according to TRT Global and Al Jazeera.

On April 27, Air India provided detailed estimates in a letter to the Ministry of Civil Aviation, stating it anticipates annual losses exceeding 50 billion Indian rupees ($591 million). The airline proposed the implementation of a "subsidy model" to counter these economic impacts, suggesting that such a subsidy should remain in place until the airspace situation normalizes. This sentiment was noted in reports that highlighted the significant operational challenges faced by Air India due to the increased fuel consumption and need for additional crew members, as per Reuters and Dawn.

As a response to the government’s inquiry regarding the airspace ban's impact, Air India highlighted its ongoing challenges, including delays in jet deliveries from major manufacturers, such as Boeing and Airbus. In the previous fiscal year, the airline reported a net loss of $520 million on revenues of $4.6 billion. Air India holds a 26.5% market share in India's aviation sector and regularly operates long-haul flights to destinations in Europe, the United States, and Canada, often flying over Pakistan’s airspace, according to reports from India Times and Reuters.

The ban's impact has prompted discussions within the Indian government regarding potential measures to alleviate the financial burden on airlines. These discussions include exploring alternative flight routes and tax exemptions. One proposed route involves flying over challenging terrain closer to China, which would require coordination for overflight clearances. Air India's letter also requested the carrying of additional pilots on routes to the United States and Canada to accommodate longer travel times, as emphasized in reports by Dawn and India Times.