Before the pandemic, the domestic flight market in Indonesia was a lot more dominant than its international counterpart’s at around 97 million versus 31 million passengers in 2017 – and such a ratio has remained unchanged. This fact might become the main driving force for the recovery of the national aviation industry, especially with the right strategy.

Currently, national headlines are talking about Garuda’s massive, piling debt. The public is concerned that the sky-high debt might lead to the flag carrier’s bankruptcy, as in the case of Merpati Nusantara airline in 2014.

The State-Owned Enterprises (SOE) Ministry is currently reviewing four options to rescue the flag carrier. First, through a provision of loans or an equity injection. This option might potentially leave Garuda with even bigger debts in the future. Second, through the bankruptcy protection line in order to smooth out the restructuring plan.

The last two options are to establish a new national airline in the middle of Garuda’s restructuring process and the liquidation of the flag carrier itself. This would mean relying on other private airlines for domestic connectivity for some time.

In fact, the pandemic has hit both our national and private airlines hard. All of them are in a critical state, and unfortunately, there has been no news in terms of saving the private airlines. Indonesia is more than just the island of Java, with all its privileges of connectivity. The government owes it to private airlines that have helped connect the mid and eastern parts of Indonesia with their pioneer flights. Choosing only to save Garuda is a discriminatory choice, and it might even lead to more trouble in the future.

Another alternative that has not been discussed is removing the restrictions for foreign investment in aviation, but with certain requirements. It takes a lot of capital and risk-taking to enter this industry, as infamously summarized by Richard Branson, the owner of Virgin Atlantic, who said: “If you want to be a millionaire, start with a billion dollars and launch a new airline.”

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