financial crisis | Business Upturn

Financial crisis forces Pakistan Airlines to cancel flights

Vanshika Lodhi — Mon, 23 Oct 2023 08:08:33 +0000

The ongoing financial crisis has forced the national carrier of Pakistan, Pakistan International Airlines (PIA), to cancel 26 flights. These cancelled flights were scheduled to depart from various cities including Karachi, Lahore, Islamabad, Quetta, Bahawalpur, Multan, and Gwadar.

The financial crunch has led to a shortage of fuel supply, resulting in the cancellation of these flights. The airline is currently facing a financial crunch as Pakistan State Oil (PSO) has halted fuel supply due to non-payment of dues.

The PIA administration reportedly addresses the issue and hopes to restore the fuel supply by Sunday once credit lines are available. A PIA spokesperson states that they are accommodating passengers affected by the cancellations on alternate flights.

They cancelled a total of 18 flights from Karachi, including three headed for Islamabad. They also cancelled two flights from Lahore and Islamabad to Karachi. According to the fuel adjustment plan, only three flights will depart from Karachi on Sunday.

In September, the PIA requested an emergency bailout of Rs 22.9 billion which was turned down by Pakistan’s Economic Coordination Committee (ECC). The ECC also rejected a request to defer payments of Rs 1.3 billion per month, which PIA pays to FBR against Federal excise duty (FED), and Rs 0.7 billion per month paid to the Civil Aviation Authority (CAA) against embarking charges.

Complaints regarding ground handling and fuel company complaints temporarily held one of the airline’s flights in Canada.They released the plane after clearing dues worth $200,000. In August, the airline had to ground 11 aircraft as the financial crisis deepened due to a lack of funds and a rise in petroleum product prices.

This situation has sparked concerns about the future viability of Pakistan International Airlines and its ability to maintain operations in the face of such a severe financial crisis.

US Debt Default: Treasury Secretary warns of “increased economic costs that could slow down the US economy”

News Desk — Tue, 16 May 2023 18:05:41 +0000

If it does not allow itself to borrow additional money, the United States federal government will run out of money within the next several weeks.

On Tuesday, US President Joe Biden started talks on the nation’s financial crisis with Republican House Speaker Kevin McCarthy and other senior legislative officials. Biden was joined in these discussions by other top congressional leaders.

In the event that members of Congress in the United States are unable to reach an agreement on how to increase the apparent ‘debt ceiling,’ this situation might have catastrophic effects on a global scale.

The debt ceiling, sometimes known as the debt limit, is a regulation that places a cap on the total amount of money that the federal government is permitted to borrow in order to fulfill its obligations. This covers payments to military personnel, government workers, Social Security recipients, and Medicare beneficiaries. In addition to that, it consists of tax refunds and the interest on the national debt.

The limit is presently set at $31.4 trillion at this time. The bank hit its maximum in January, but the United States Department of the Treasury utilized “extraordinary measures” to supply the government with more funds while it decided what to do next.

Treasury Secretary Janet Yellen has issued a warning that if the United States does not take on more debt, it would not have the funds to fulfill all of its financial obligations by June 1.

“Every single day that Congress does not act, we are experiencing increased economic costs that could slow down the US economy,” Yellen said in her statement.

Go First suspends flight operations, files for insolvency amid financial crisis

News Desk — Tue, 02 May 2023 12:41:54 +0000

The Indian airline business Go First has decided to cancel all of its flights on the 3rd and 4th of May. The Wadia Group, which owns the failing airline, is reticent to invest further in the company’s operations.

According to the chief executive officer of the airline, Kaushik Khona, who was describing the issue to PTI, the airline has been forced to apply for voluntary insolvency resolution procedures due to the suspension of operations. These processes will take place before the National Company Law Tribunal in Delhi.

“It is an unfortunate decision… but it had to be done to protect the interests of the company,” said Khona. “Go First is facing a financial crunch due to the non-supply of engines by Pratt & Whitney, which has forced the company to ground 28 planes.” “It is an unfortunate decision… but it had to be done to protect the interests of the company.”

The airline now has over 3,000 workers and has already told the government that they would be presenting a full report to the Director General of Civil Aviation. However, according to the CEO, the airline will not begin flying operations until after the insolvency application has been accepted.

In a statement that was released on Tuesday afternoon, Go First said that it ‘had to take this decision owing to the ever-increasing number of malfunctioning engines’ that were provided by the American firm Pratt & Whitney. According to the airline, these malfunctions were responsible for the grounding of 25 aircraft as of May 1; this is over half of their whole fleet.

Pakistan faces its worst economic crisis in history as foreign debts mount up: Report

Cheryll Jain — Wed, 20 Oct 2021 09:33:10 +0000

Pakistan is now battling what is being estimated as the worst economic crisis ever witnessed by the country, an English-language newspaper The News Internation reported. As per the report, the country is facing mounting foreign debt which will make it liable to require gross external financing of USD 51.6 billion within a two-year period in order to fulfil its needs.

Within the two year period, Pakistan’s gross external financing requirement stands at USD 23.6 billion in 2021-22 and USD 28 billion in 2022-23, in spite of the Internation Monetary Fund’s cautious estimates.

To dispel the increasing risk of the crisis, Pakistan authorities are now in the works to make a last desperate attempt to reach a staff-level agreement with the IMF to tide over the external financing requirements.

The News International also reported that if the authorities are unsuccessful in striking a deal with the IMF under its current USD 6 billion Extended Fund Facility (EFF) during the ongoing discussions in Washington, this increasing gross external financing requirement will be further put at risk with the subsequent suspension of program loans from other multilateral creditors such as the World Bank (WB) and Asian Development Bank (ADB).

Recent analysis reports by the World Bank revealed that Pakistan is now one of the top ten nations with the highest foreign debt in the world. The reports also disclosed that the country’s foreign debt increased by over 8 per cent this year. Moreover, it suggested that the Imran Khan-led government had borrowed USD 442 million from the World Bank.

For now, the WB and the ADB will continue to lend project loans to Pakistan, but due to the decreased capacity of the country to implement such projects, the loan amount will be bleak. Furthermore, The News International reported that The credit rating agencies are expected to further lower the country’s ratings, making the generation of funds through the issuance of international bonds more costly.

Officer sources have stated that keeping in mind the country’s economic instability, the IMF had advised Pakistan to remove the distortions into the taxation system, pointing out that different GST exemptions and rates should be aligned with the standard rate of 17 per cent.

According to the recommendations made by the IMF, the standard GST rate of 17 per cent should be imposed on Petroleum Oil Lubricants (POL) products in the country. Similarly, the GST rate on fertilizer, tractors and other items should also be brought at the standard rate of 17 per cent.

However, Pakistani authorities are resisting such recommendations, claiming that it would further marginalize the neglected agriculture sector in the country.

IMF Chief Economist Gita Gopinath calls for more fiscal push

Shalmali Bhagwat — Tue, 03 Nov 2020 06:55:48 +0000

Gita Gopinath, Chief Economist of the International Monetary Fund (IMF) has urged policymakers around the world to provide fiscal stimulus to boost a relatively faster recovery from the ghastly repercussions inflicted by the pandemic, as the world economy stares at a liquidity trap.

“For the first time, in 60 per cent of the global economy — including 97 per cent of advanced economies — central banks have pushed policy interest rates below 1%,” said Gita Gopinath. Central Banks have attempted to tackle this issue with unconventional measures, but despite all efforts, consistently low inflation and in some cases intermittent deflation has raised the concern of negative real rate, in case of another blow to the global financial system.

Central banks’ policies have played a role but are limited to stimulate demand. Hence, shaping new dynamic fiscal policies is the need of the hour. Fiscal authorities can actively support demand through cash transfers which support consumption and large-scale investment in medical facilities, digital infrastructure and environmental protection. This will result in large-scale job-production, give a boost to private investment and lay the foundation of a speedier but more sustainable recovery.

Many countries have lowered interest rates and further reduced the debt-servicing costs which will stimulate investment in many economies, without compromising debt sustainability or bond market access. The stimulant size shall vary according to the country’s financial standing and economic outlook. Those who have entered the crisis with heavy debts shall require financial support while spending will be prioritized.

Gopinath further expressed that this is a once in a lifetime global financial crisis and policymakers should respond accordingly. In the World Economic Outlook report released last month, the IMF forecasted a contraction to the global economy of 4.4%. The way out is likely to be long, eventful and uncertain but a global fiscal push can elevate prospects for all.

Half of Bollywood will be OUT OF WORK even after lockdown ends: Experts

News Desk — Wed, 01 Jul 2020 18:09:08 +0000

Bollywood is in dire straits. After the Corona Crisis Lockdown, the entire industry is sitting at home and out of work. But what is most worrying now, is that experts predict that the situation is not going to go back to normal again. The new normal is going to witness around half of the film industry staying out of work. Business Upturn spoke to industry experts.

Read this exclusive article to know more and how to keep your personal brand alive and afloat in this time of impending financial crisis.

The lockdown has struck the most destructive and devastating blow to the entertainment industry. It has crippled the lives of thousands of daily wage workers, upcoming and existing talents, including actors, dancers, make-up artists, costume teams, technicians etc.

Bollywood going downhill

“Many would have already changed their professions and got into small time odd-jobs to somehow survive this phase with whatever they can earn here and there. The film industry has lost its way. Half of our industry’s workers will still be running helter-skelter for jobs and many of them will have to diversify into other fields and keep their participation in films to minimal,” says trade analyst Rajeev Chaudhari.

Amit Behl, senior joint secretary of Cine & TV Artists Association (CINTAA) echoes the sentiment. “Yes, half of Bollywood would definitely be out of work even if the lockdown ends. This is primarily because of specific reasons. One, because of the clash in directives between the State Government and the Central Government.”

“Plus, considering the hazards of COVID-19, there is a clear directive that actors above 65 and children below 10 will not be allowed to work till the time new norms come into place. Going by this rule, a lot of senior actors as well as child artistes will definitely be out of work, primarily when it comes to television. There have been huge budget cuts by the broadcasters and those budget cuts have been passed on to producers. So eventually it will go down to the cast and crew and the daily wage workers,” explains Behl.

Senior journalist Latha Srinivasan remarks, “The lockdown and its restrictions for more than 90 days has caused significant financial losses to producers, production houses, distributors and exhibitors. As a result, once the lockdown is lifted, it won’t be possible even for top actors in Bollywood to get back to work as businesses have to be realigned post examining the financial aspects and how best they can minimise further losses.”

Prepare for the worst

News of resumption of film and TV serial shootings has come out, but many technicians and actors are upset with the severe guidelines that have been issued along with insurance for all unit members etc. These additional costs of meeting the conditions of these guidelines are going to be challenging for the producers. Even if mainstream shootings will revive, there will be restrictions on crowd scenes, intimate scenes etc. with compromise in creativity and logistics.

Director Vivek Sharma who made the famous film Bhoothnath starring Amitabh Bachchan and featuring Shah Rukh Khan opines, “Thanks to film mafia, half of Bollywood was always out of work and post lockdown it will be the same. Television and web series’ actors will be in demand as these platforms need content to run their channels.” He feels that shoots will begin normally after September 2020 and that slowly people will get back in business.

To survive this lockdown and the fear its brought with it, Sharma suggests a lot of online interactions including workshops. “It’s a good time for people to learn and prepare for a time which will bring more and more changes and possibilities,” he says.

But Amit Behl is concerned about many other things than how one can make the most of this dismal phase. He worries about the fact that there is a “drastic cut in the crew members of the film shoots, which is about 30-35 percent slash in the number of people on the sets. That means a lot of people are going to be out of work. A lot of roles of junior artistes and actors are also going to face the axe because Indian daily soaps survive on family drama and a lot of wedding scenes, festival sequences and song and dance sequences, which will now have to be drastically cut or omitted altogether. There will obviously be no crowd involvement and no audience in any talk shows, game shows, reality shows and these kind of competition-based shows. Also, a lot of technical crew is going to be cut down, and all this is surely going to affect Bollywood as well as the television industry.”

Drawing our attention again to the state of affairs, Behl says, “The focus is now going to be about who all is essentially required on the sets and by the broadcaster. Those departments which can’t be avoided in shoots… those are the people who will get work for now. Of course, everyone is very hopeful that this crisis does not last beyond the end of 2020, but because of the dialogues I have had in the last three months with about 60 trade unions in 83 countries, I can say that the budget cuts and crew member cuts in other parts of the world are even more brutal than they are in India.”

Having said that, Behl points out that a lot of western countries have better technical finesse, so they can manage with the cuts. But we are a very manpower-heavy entertainment industry, so it’s going to hit us even harder and affect a lot more people than anywhere else in the world.

“But we can’t blame broadcasters for having heavily slashed their budgets. Because advertising revenue is down, the broadcasters don’t have much of an option. Its only the FMCG (Fast-Moving Consumer Goods) companies who are advertising right now and its slightly inhumane for companies to begin advertising products related to COVID… whether it’s for a cure or for a PPE Kit (Personal Protective Equipment Kit) or for sanitizers. So we are in hard times and just hoping for the skies to clear,” he adds.

Improve communication and PR skills

Amith Prabhu, founding Dean at School of Communications and Reputation (SCoRe) is more concerned about how to utilize this time in self-improvement and education. Like many other he is of the opinion that this is the time to hone your communication and PR skills.

He asks industry people to explore opportunities to create low-cost yet high-quality cinema. He feels this is also a time to reset lifestyles and suggests five things actors can do. Here are the pointers he puts forth:

1) First offer a free and then a paid masterclass to fans on social media.

2) Create a low-cost short movie series shot from home or from places where crowds can be avoided.

3) Learn something new with multiple courses available online.

4) Support a non-profit organisation by being a temporary brand ambassador with no cost to that organisation.

5) Write a monthly column on the advantages of communication in the world of TV and cinema.

Fees to drop heavily

Rajeev Chaudhari wants to bring people’s attention to box-office collections. “Now with this humongous loss in our industry, the prices that a regular TV serial used to fetch from a channel will come down drastically to less than 50% and a feature film cannot perceive box-office business in hundreds of crores anymore. Gone are those days.”

He feels that the film industry’s corporate status has crashed and its premium value has diminished. “Now with reduction in film and TV unit members, along with reduction in the number of films being made, work opportunities will be very less and fees in all the departments will drop heavily.”

Chaudhari points out that in view of above cuts, due to new guidelines and deep recession, even if the lockdown opens up, it will not be able to accommodate all workers and creative labourers with jobs.

Beware of depression, suicides, fear

“The Corona Crisis has taken a huge toll on the financial and mental health of the industry’s labourers and creative members, leading to depression and suicides. This severe catastrophic state has never been seen before in our entertainment industry,” he adds.

Latha Srinivasan feels, “Given the government regulations to be followed for shoots, one needs to see how many people are comfortable working in such an environment. Some actors may not want to shoot till they are 100% sure their health is not at risk and it’s anybody’s guess as to when the environment will be COVID-free, if at all.”

“Yes, it’s true. Barring three or four of them, most Bollywood celebrities are not even stepping out, so to come for work is not going to happen,” says Viral Bhayani, the most popular Bollywood freelance photographer on Instagram.

“Everyone is waiting for a cure and Mumbai the epicenter of Bollywood still remains at a huge risk. If the shoots begin and something unforeseen happens then it is all going to go in vain. I know it has badly affected everyone financially but we will have to be more patient,” he remarks.

Surprisingly, Bhayani admits to a stark reality for many in the industry by giving an example of his own case. “Just like many who depend on outdoor work in their business, for me too, the photography business has unfortunately been destroyed at the moment. I’ve faced the probability of shutting down completely. But I also know for a fact that once the cure is out, we are gonna rock again. Things will be back to normal. Somehow I feel it is going to happen soon,” says Bhayani, hoping against hope.

He remarks that right now we all have to survive on our past incomes till things get normal. “Some of the shoots have begun but they are all happening outside of Mumbai and there too, most unit members are extremely scared. So even after the lockdown ends, many will still be left with little work or no work at all.”

Bhayani also brings us to another aspect of this issue, saying that the commitment and sentiment right now is so low that no filmmaker will take a risk to make a film unless there is cooperation from the Government and technicians charge fairly as per the current situation.

Larger-than-life cinema could return

But veteran freelance journalist Rajiv Vijayakar disagrees with many such notions. “I do not think we can quantify how much of the industry will be out of work after the lockdown. I am looking at it in another way.”

“The days of niche movies pandering to the ‘intelligentsia’ and pseudo-intellectuals — the so-called ‘multiplex cinema audience’ — are numbered. With a plethora of such films as well as inferior commercial movies hitting OTT directly, it is clear that such products will make a small but secure profit, which, sadly, will keep cinematic excesses like Ghoomketu and Bhonsle coming. But the pan-Indian movies will thrive, as these alone will get returns commensurate with the investments, as in the past.”

“The range of such movies, obviously, extends from Andhadhun to Sooryavanshi and the South kind of spectacles,” he adds. Vijayakar feels that all this will slowly, but surely, culminate in Hindi films reemerging as the mass-medium of entertainment which it was once upon a time, and which it should be. Accordingly, only the stars, filmmakers and composers who believe in such larger-than-life cinema will thrive.

Pandemic shall pass, but competition won’t

Casting director Ahana Mohammed says, one should simply accept the challenge the COVID-19 pandemic crisis has thrown on us and make it favorable. “Those who do not have Godfathers in the industry to provide big breaks, can start learning ways to sharpen their skills.”

“The best way to survive is to get yourself moving, even if it means virtually. Get connected to people, share your thoughts and emotions, be wise and utilize this time by learning ways to master your craft,” she adds.

She makes another point, saying that one needs to up his/her ante by getting professional help in this crucial time. “Get an agent on board, who can understand your talent. Follow this up with good PR activity, which is necessary to put actors — especially freshers — high up amongst the cutthroat competition. Remember, the pandemic shall pass, but competition won’t,” concludes Mohammed.

Star prices will normalize, nepotism will decrease

Veteran journalist Jyothi Venkatesh makes a very interesting observation on the same lines. “After the lockdown, only the fittest will survive in Bollywood whether it is actors or journalists or PR persons. The field will be automatically filtered and the best in their professions will continue. Star prices will normalize and nepotism will decrease, though not eliminated.”

“A lot of money will be saved and things will eventually turn for the better. Though with social distancing, it will be tough to show romance, content should improve. The biggest beneficiaries will be the OTTs.”

“In this scenario, only those who know their work and worth will be able to flourish and the rest will perish,” he adds. Venkatesh also points out that a change will be evident among film exhibitors. “The multiplexes will realise that they are here not to fleece the industry by charging producers and distributors rentals for trailers and standees, or milk the patrons with steep prices for samosas and Pepsi and also for drinking water.”

Need for brand control

New-age film journalist and blogger Diganta Guha says, “It seems quite incredulous that the bigwigs might not have any silver screen releases this year. Time is running out and they would have to be through with their pending projects. Crores are at stake and nobody wants to incur humongous losses just for the sake of delays.”

He adds that apart from the lockdown, actor Sushant Singh Rajput’s untimely demise has been a jolt from the blue. “At this point of time, we need strong personalities as a lot of worms are getting out of the can and Bollywood may take a drastic fall if this does not stop. What is probably needs right away is some PR control to avoid the tsunami of controversies destroying its reputation.”

Guha analyses, “A great PR like Dale Bhagwagar could be the ideal person to guide actors and actresses through this period. Over the years, this guy has been legendary, handling media publicity for so many stars such as Hrithik Roshan, Shilpa Shetty and Priyanka Chopra. He is best suited for helping new actors and actresses maneuver their way through PR during such a crisis situation. Otherwise, a lot of celebrities might simply fade away into oblivion by the time all this chaos ends.”

Rajeev Chaudhari echoes Guha’s views.”A seasoned publicist like Dale Bhagwagar can suggest new PR ways to help actors survive this period. Because, in such a time, an out-of-sight actor and actress, will now be out of the industry.”

He evaluates that “With this deep recession and fierce cut-throat competition, there will be scuffling struggle by industry workers and professionals to be visible to the employers of the film and TV industry. I think now is the need for a good Bollywood publicist who can salvage good talent.”

PR or perish

But Chaudhari cautions that “Bollywood publicists too will have to find new ways to ensure that their PR clients are actively present in the radar of the casting directors and filmmakers, by generating articles, features, interviews, news, healthy gossip and Press Releases which suit the situation. The market has become acutely competitive and an actor or a professional can’t afford to skip the help of PR services now.”

He adds that every professional should seek effective PR help to make his or her presence felt in these challenging times. “Actors will have to be doubly aggressive in their approach and struggle to acquire work from production houses. With good active PR support, actors and actresses can keep registering their names their faces in the public even when they are not working. Their constant presence on the best Bollywood websites as well as social media and other PR mediums, could ensure celebs and upcoming artistes a place in the minds of casting directors and filmmakers.”

True! Fact is that the situation is what it is and film actors and technicians can’t help it, but focus on their PR at the moment. The only thing in their hands right now is to survive this crisis by staying afloat and continuing to be in the news. Otherwise, by the time the Corona Crisis ends, a new lot of actors and actresses will be ready to take over all the roles and new-age platforms setting their mark. Those you will have kept themselves in the news, might have some chance of survival. Many will perish.

Jo dikhta hai woh bikta hai

In the world we live in, there’s this umbilical cord between fame and credibility. Here, visibility equals credibility. You cannot be credible unless you’re visible. And that’s where the PR professionals and PR teams come in the picture. many in the industry believe that staying put in the news through PR is the best way to tide over this crisis. After all, the dictum ‘Jo dikhta hai woh bikta hai’ has always worked in Bollywood.

Maybe it’s for this reason that we are now seeing an influx of Bollywood’s upcoming stars, flock to PR guys to keep them in news during the lockdown. Actresses and actors are desperately trying to strengthen their brand and image so that they would be the ones to get work by the time this whole downturn ends.

Earlier, we have reported how Bollywood’s PR legend Dale Bhagwagar has been getting a huge amount of PR offers suddenly during lockdown. The top Bollywood publicist has signed seven new PR clients during the lockdown and shows no signs of slowing down.

Stay relevant, stay connected

Talking about PR strategies, Latha Srinivasan says, “Many actors might still want to stay relevant and connected to the audience at this time given that they may not be able to shoot or their films may not be releasing. One of the key things celebs should do is use their social media platforms to amplify the good work being done by people, start a fundraiser and talk about health and safety. They should also use their social media to uplift the morale of people. For instance, they can shoot fitness videos or showcase their other talents which people are not aware of.” But she warns that all top Bollywood celebs need to be careful to not put out posts that showcase them as the privileged lot, as this will backfire on them and bring up the topic of nepotism again.

Vivek Sharma is also of the opinion that celebrities should improve and improvise on their PR at this time. “The world is suffering. Not only from the Coronavirus Crisis, but also from depression. There is a lot of fear. During such a time if we film industry people make positive motivational videos, short films and vlogs, we can be a pillar of strength for many people. We can give hope and share hope, umeed, jazbaat aur saath.”

Viral Bhayani brings new insight to this. He points out that celebs do a lot of things for the sake of earnings. And it would be difficult for them to monetise most of the stuff they put on the web. “For Bollywood celebs to make money online is difficult as even if they make short films for YouTube, it takes a lot of time to monetise them.”

He says that workout videos of filmstars are often trending but after a point of time the actors need to balance them out with more different hobby ideas like cooking, singing, family videos, pet videos, Instagram Live appearances and even participation on debate shows online. He suggests that filmstars can also do their own photo shoots and show their fans different looks, fashion trends, gym looks and glamour looks.

Whatever be the case, we pray that our favourite entertainment industry comes out of the terrible situation it’s found itself in. We have our fingers crossed for all those who have lost work and hope they would be able to recover the lost time, stay afloat in news and bounce back when their time returns.