Financial burden

December 8, 2024

Gwadar Airport risks becoming a white elephant

Financial burden


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n November 21, officials informed Federal Minister for Planning and Development Ahsan Iqbal that the country’s largest airport, the New Gwadar International Airport, lacks a viable commercial plan. They said that the NGIA would not be commercially sustainable until Gwadar Port and its adjacent Free Zone were fully developed. This has sparked a debate over whether the facility will deliver on its promise or linger as a heavy burden.

The NGIA, a $246 million venture funded primarily through a grant from Beijing, was conceived under the China-Pakistan Economic Corridor. As the largest CPEC project in Balochistan, the NGIA symbolises Gwadar’s envisioned transformation into a regional commercial hub. However, the lack of a viable commercial plan has cast a long shadow over its future.

The airport was officially inaugurated in October during a virtual ceremony by Prime Minister Shahbaz Sharif and Chinese Premier Li Qiang. Situated approximately 45 kilometres from the Chinese-operated Gwadar Port, the NGIA spans a sprawling 4,300 acres, making it the country’s largest airport by area, surpassing Islamabad’s. Equipped to accommodate aircraft like the Airbus A380, it promises to connect Gwadar with the world.

The viability of this airport is fundamentally tied to the success of CPEC and Gwadar’s development as a commercial hub. Both have struggled to gain momentum. Despite years of investment and rhetoric, CPEC projects have faced delays, financial constraints and governance challenges, leaving Gwadar underdeveloped and its potential unrealised. The port and Free Zone, imagined as the economic engines driving the NGIA’s operations, remain largely inactive. Without the robust commercial activity promised by the CPEC, the NGIA lacks the economic ecosystem necessary to sustain its operations, rendering it a costly and impractical venture.

During the same November meeting, Iqbal directed officials to develop Gwadar as a tourist hub to utilise the NGIA. Tourism, while a potential contributor, cannot substitute the large-scale commercial traffic the airport was meant to handle. Relying on tourism to justify the NGIA’s existence seems impractical, given the limited infrastructure, services and accessibility in Gwadar to attract substantial tourist footfall.

The NGIA was conceived with mass air travel in mind, predicated on Gwadar’s transformation into a major commercial centre. This vision, however, has yet to materialise. Tourism can, at best, be a supplementary feature — not a viable alternative for sustaining a facility designed for international trade and large-scale logistics. Without substantial commercial activity, the NGIA risks becoming an under-utilised asset.

The minister also proposed positioning the NGIA as a regional air travel hub. However, this idea faces significant practical challenges. A key obstacle is the absence of a robust national airline to anchor such operations. Pakistan International Airlines, the country’s struggling flag carrier, is ill-equipped to establish the connectivity and frequency required for a hub. Without a strong home-based airline, the NGIA lacks the critical element needed to attract international carriers and foster the transit traffic essential for a regional hub.

While Iqbal’s suggestion highlights the airport’s strategic potential, it overlooks the competitive dynamics of the regional aviation market. Neighboring countries, supported by globally successful airlines like Emirates and Qatar Airways, dominate the regional hub landscape. Pakistan’s aviation industry, marred by financial and operational challenges, cannot provide the infrastructure or partnerships needed to make the NGIA competitive.

The NGIA risks becoming a white elephant. Currently, only a few flights operate weekly to Gwadar. The sparse schedule is unlikely to change with the NGIA’s inauguration. The airport’s state-of-the-art facilities and massive infrastructure were designed to handle a larger volume of air traffic contingent on Gwadar’s transformation into a thriving commercial hub.

Even with minimal operational activity, the operational and maintenance expenses for the NGIA will amount to billions of rupees annually. The high cost and limited air traffic underscore the financial burden the airport could impose on the government. Instead of creating economic opportunities, the NGIA may become a drain on public resources, further fuelling scepticism about the feasibility of large-scale infrastructure projects in underdeveloped regions.

The government must acknowledge the ground realities surrounding the NGIA and avoid overstating its potential. Promoting the airport as a massive success without addressing the structural issues of Gwadar’s development can only lead to unrealistic expectations. Without significant progress in transforming Gwadar into a commercial hub, the NGIA appears destined to remain an under-utilised asset, emblematic of unfulfilled promises and misplaced priorities.

The NGIA could become a cautionary tale for ambitious infrastructure projects undertaken without robust demand assessment and commercial feasibility. The government must recalibrate its expectations and avoid misleading the public about the NGIA’s potential. Moving forward, it is imperative to conduct realistic demand assessments before committing to such large-scale ventures.


The writer is a journalist based in Islamabad. He is the lead contributing writer for Nikkei Asia in Pakistan. He can be reached at adnan.aamir@live.com He posts on X, at @iAdnanAamir

Financial burden