Pakistan’s aviation sector has grown in passenger numbers over the past two decades. However, its structural strength has not improved at the same pace. The Competition Commission of Pakistan has released a draft report highlighting these challenges.
The report, titled “Competition in the Skies: Pakistan’s Civil Aviation Market Assessment,” reviews aviation performance from 2006 to 2025. It also incorporates consultations with stakeholders across the aviation industry. The assessment aims to identify structural gaps and improve long-term competitiveness.
Passenger Growth Shows Uneven Progress
Pakistan’s aviation sector served nearly 340 million passengers during the review period. Passenger traffic increased from 12.8 million in 2006–07 to 24.3 million in 2024–25. This represents an 89 percent increase.
However, the long-term growth rate remains moderate. The sector recorded an overall compound annual growth rate of about 3.42 percent.
Most of this growth came from international travel. International passenger traffic grew at a CAGR of about 5.46 percent. In contrast, domestic aviation remained almost stagnant. Domestic travel recorded a CAGR of only 0.19 percent.
Therefore, domestic aviation has not expanded despite Pakistan’s population growth and economic potential.
Absence of a National Aviation Vision
The study highlights the absence of a unified aviation strategy. Pakistan has not treated civil aviation as a strategic economic sector.
Instead, aviation governance often remains fragmented across institutions. As a result, policy coordination remains weak.
The report stresses that aviation policy cannot operate in isolation. Effective governance requires coordination among regulatory, fiscal, and financial bodies.
Without this alignment, structural weaknesses continue to persist.
Structural Weaknesses Limiting Sector Growth
The assessment identifies several systemic gaps in the aviation sector. First, Pakistan lacks an integrated national aviation strategy. Second, governance remains fragmented across institutions.
Furthermore, domestic aviation growth has lagged behind international expansion.
Airline instability has also weakened the sector. Several domestic carriers have exited the market due to financial difficulties.
Moreover, aviation-specific financing options remain limited.
The report also notes the underutilization of several airports across the country. Many facilities operate below their full capacity.
Meanwhile, Pakistan increasingly depends on Gulf-based airlines for international connectivity.
Competitive imbalances also exist between domestic airlines and foreign state-backed carriers.
Aviation’s Role in Economic Connectivity
Civil aviation plays a critical role in economic connectivity. Air transport supports tourism, trade, and mobility.
Therefore, a strong aviation sector contributes directly to economic growth.
However, geopolitical tensions and restricted airspace have increased operational risks. These factors highlight Pakistan’s vulnerability within the regional aviation network.
Consequently, the report stresses the need for a stronger and more self-reliant domestic aviation sector.
National Aviation Roadmap Proposed
The report recommends creating a National Civil Aviation Roadmap. It also proposes a phased Reform and Stabilization Plan.
This strategy aims to build a resilient and investment-ready aviation ecosystem. The plan would integrate aviation with tourism, financing, and commercial services.
In addition, the roadmap emphasizes regulatory clarity and financial sustainability. Stronger coordination between institutions will remain essential.
Infrastructure and Digital Reforms Suggested
The study outlines several infrastructure priorities. Major terminals in Karachi and Lahore require modernization. Secondary airports such as Skardu and Gilgit also need development support.
Digital transformation will also play a key role. Authorities should introduce electronic gates to improve passenger processing. Similarly, digital slot allocation could enhance airport efficiency.
The report also recommends creating a unified aviation data hub. This platform would support better policy planning and data-driven decisions. Additionally, real-time reconciliation through integrated border systems could improve operational oversight.
Strengthening the Domestic Aviation Ecosystem
Financial reforms remain necessary to support aviation growth. The report recommends aviation-specific financing and insurance frameworks.
Stable foreign exchange policies and predictable fee structures would also help airlines. Tax rationalization could further encourage investment.
Airports should also adopt self-sustaining commercial models. Strategic private sector participation may improve airport operations. Moreover, the report encourages the promotion of low-cost carriers.
Low-cost airlines could expand domestic connectivity. Small and medium enterprises should also participate in aviation-related services. Additionally, Pakistan should develop local maintenance, repair, and overhaul facilities. Such facilities could strengthen technical capacity within the country.
Ensuring Fair Competition in Aviation
The report stresses the importance of competitive neutrality. Authorities should reassess historical privileges that distort competition. At the same time, the aviation market must remain open to new entrants.
However, strategic oversight of critical aviation infrastructure must remain protected. This balance would support fair competition while protecting national interests.
Stakeholder Consultation Underway
The draft report remains open for stakeholder feedback for a limited period. Industry participants can review the findings and submit their comments. After consultations conclude, authorities will publish the final report.
The recommendations aim to transform Pakistan’s aviation sector into a competitive and resilient industry. Ultimately, the goal is to shift from simple passenger growth toward sustainable, competition-driven development.
