Airlines of Bangladesh in turmoil due to COVID-19
Probably the most affected sectors as a result of coronavirus outbreak may be the airlines industry of Bangladesh.
The air connectivity between Bangladesh and outdoors world has considerably reduced as time passes amid the COVID-19 pandemic with withdrawal of fights by operating foreign airlines and closure of routes connecting Bangladesh by several countries.
In the mean time, the Civil Aviation Authority of Bangladesh (CAAB) possesses suspended all plan international flights to and from Bangladesh from 0001 BST on April 8 to 2359 in April 14. This means almost total halt of air flow procedure to and from Bangladesh.
In a circular, the CAAB said that the action has been taken “taking into consideration the persistent risk also to avoid expansion of pandemic COVID-19 throughout the country”. It explained, all scheduled international professional passenger flights from Bahrain, Bhutan, Hong Kong, India, Kuwait, Malaysia, Maldives, Oman, Saudi Arabia, Sri Lanka, Singapore, Thailand, Turkey, UAE, and UK “shall not be allowed to property at any international airports of Bangladesh”.
At the moment, except Dhaka-Guangzhou route of US-Bangla Airlines all international air routes are closed, though temporarily. Flights on all domestic routes happen to be also laying suspended.
Situation in every the a number of airlines of the country - express owned Biman Bangladesh Airlines and personal - Regent Airways, NOVOAIR and US-Bangla Airlines - are actually similar and with closure of air travel, one after another, most of the aircraft are now laying grounded.
No income, huge expenditure
With drastic reduced amount of operation for quite some times now, the revenue income of all the airlines nose-dived.
While sources of earnings earning have dried for these airlines, some predetermined expenditures such as civil aviation costs, maintenance of aircraft, income of employees have grown to be heavy burden for these airlines.
According to concerned sources, there are always a total of 44 aircraft owned by these 4 airlines - Biman - 18, US-Bangla - 13, NOVOAIR - 7 and Regent Airways - 6. Most of these aircraft are actually grounded as there is absolutely no operation.
Mukabbir Hossain, Managing Director and CEO of Biman Bangladesh Airlines said without flight, there is absolutely no income or earnings. But Biman is certainly to keep the grounded aircraft and 17 overseas offices in addition to head-quarter and domestic office buildings. The situation resulted in lack of BDT 400 crore in January, February and March weeks.
Abdullah Al Mamun, Managing Director of major private carrier US-Bangla Airlines said lately March, the airline has incurred a good lack of BDT 250 crore. “In history eight months, we've expanded our fleet with six completely new aircraft. But coronavirus provides crippled us. Last anticipation - the domestic procedure in addition has topped."
Since there is no procedure, bank installments, price of aircraft repair, various taxes and civil aviation fees, overseas offices and salaries of employments are positioning huge pressure on personal airlines, Mamun added. He demanded declaration of “rescue package” by the government.
Govt support
It really is learnt that Secretary Standard of Aviation Operators Association of Bangladesh (AOAB) and Managing Director of NOVOAIR Mofizur Rahman informed that to ride more than the present crisis AOAB has submitted a good proposal to Ministry of Civil Aviation and Tourism demanding withdraw of civil aviation costs, advance taxes of import of extra parts and tax on fuel. He as well demanded interest no cost deferred payment for a few part of bank loans.
IATA appeal
The International Air Transfer Association (IATA) is urging Asia-Pacific states to take urgent action to supply financial support to their airline industry influenced by the COVID-19 crisis.
“Based on a scenario where severe travel restrictions previous for 90 days, the Asia-Pacific region as a whole will dsicover passenger demand reduced simply by 37 per cent this year, with a revenue lack of USD 88 billion. Whilst every country will see varying effect on passenger demand, the net result may be the same - their airlines happen to be fighting for survival, they are facing a liquidity crisis, and they will need financial comfort urgently to sustain their businesses through this volatile scenario,” explained Conrad Clifford, Regional Vice President, Asia-Pacific, IATA.
In its most up-to-date analysis, IATA expects airlines to post a net lack of USD 39 billion during the second quarter closing June 30, 2020. The affect of that on income burn will come to be amplified by a USD 35 billion liability for potential ticket refunds. Without comfort, the industry’s cash location could deteriorate by US$61 billion in the second quarter
BD govt action
Senior Secretary of Ministry of Civil Aviation and Tourism Muhibul Haque recently told media that the ministry is usually collecting demands from the affected airlines. Decision will be studied following discussions between federal government and concerned parties.
Meanwhile, Primary Minister Sheikh Hasina’s announcement on April 5 has made wish that country’s airline market may get rescue financial support. Even so, the healthy and size of support isn't clear at this time.
Primary Minister Sheikh Hasina unveiled the federal government work plan to overcome the possible COVID-19 impact on the country’s economy, declaring an allocation of BDT 72,750 crore under a couple of stimulus packages.
In a nationwide televised address, she said “I am hoping our economy will rebound and we're able to reach near to the desired economic expansion, if the stimulus programs, the previous and the new ones, could possibly be quickly implemented”.
The Prime Minister said that, "The sectors and areas which are being afflicted are: industries production, export trade, services sectors, especially tourism, aviation, and hospitality sector, tiny and medium enterprises and employments and they are experiencing a landslide fall."
