Indian airlines are expected to benefit from shorter flight routes to Europe and other western destinations, as Pakistan removed complete airspace access restrictions on Tuesday.
"After cancellation of NOTAMS by Pakistan and India in the early hours of Tuesday, there are no restrictions on airspaces of both countries, flights have started using the closed air routes, bringing a significant relief for airlines," the Ministry of Civil Aviation said on Twitter.
On Tuesday morning, Pakistani authorities announced the complete reopening of the country's airspace for civilian flights, nearly five months after the military escalation with India.
"With immediate effect Pakistan airspace is open for all type of civil traffic on published ATS (Air Traffic Service) routes," according to a notice to airmen (NOTAM) published on the website of Pakistan's Civil Aviation Authority.
In March, Pakistan had partially opened its airspace but kept it closed for Indian flights.
The closure of Pakistan's airspace following air strikes by the Indian Air Force on February 26 in Balakot took a heavy financial toll on national carrier Air India.
An Air India spokesperson: "Ever since Pakistani airspace was closed, we had to reroute our flights south of Pakistan. The flying time for long haul flights towards USA increased by 90 minutes and also addition fuel usage was needed."
The airline's US-bound flights had to be stopped at Vienna to get a new crew.
"As Pakistan airspace is now open aircraft utilisation will go up, while crew requirement will come down by 25 per cent," the spokesperson said in a statement.
"Flight operation cost for USA-bound flights may come down by Rs 20 lakh on one-way and for Europe-bound flights, it may come down by Rs five lakh."
Earlier, Civil Aviation Minister Hardeep Singh Puri acknowledged in Parliament the financial strain that the airspace restrictions caused to Air India.
From March till July 2, the national carrier had bore the brunt of an additional cost of Rs 490.6 crore due to the airspace restriction.
According to IndiGo: "We are pleased with the latest development relating to the opening of the Pakistan airspace as announced today."
"IndiGo flights flying via Pakistan will operate as normal after all regulatory clearances by the concerned authorities."
The airline has a codeshare agreement with Turkish Airlines and operates flight services to Istanbul.