Pakistan Closes Airspace, Indian Airline IndiGo Suffers Heavy Losses

You might be wondering what happened to cause such a big drop in IndiGo’s stock price. It all boils down to a recent decision by Pakistan. Pakistan decided to close its airspace to Indian flights, and this has had a ripple effect on Indian airlines like IndiGo.

With Pakistani airspace off-limits, flights to the US and Europe will now take 2 to 3 hours longer. This means higher operating costs for airlines and unfortunately, passengers will likely see airfares increase by 8 to 12 percent.

This news hit IndiGo hard on Friday. The company’s shares dropped by about 4 percent, knocking almost Rs 8,000 crores off its market value. The stock price dipped to Rs 5,313.20, a significant drop from its opening price.

It’s worth noting that IndiGo has actually had a pretty good year so far. In the last year, its shares have grown by about 35 percent, and in the current year, they’ve climbed by 15.48 percent.

But this recent setback reminds us how quickly things can change in the airline industry.

This whole situation is a result of rising tensions between India and Pakistan. The recent Pahalgam incident has escalated things, leading to a diplomatic standoff. India has suspended the Indus Water Treaty, which affects millions of Pakistanis, while Pakistan’s airspace closure directly impacts Indian airlines.

The future of IndiGo and other Indian airlines will now depend on how quickly these tensions can be resolved.