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India’s international passenger traffic shows de-growth of 8.2% in August: ICRA
Oct-16-2019

Rating agency ICRA in its note has said that Indian airlines international air passenger traffic degrew 8.2% in August as against a 3.9% growth in the domestic volume in the same month, with market share declining to 34.2% in the month on account of under-performance. It also said the traffic growth on overseas routes in the first five months of current fiscal was negative at 12.2% as compared to 0.1% negative growth in the period year-ago.

The market share of the Indian carriers on international routes declined by 377 basis points year-on-year to 34.2% in August due to the under-performance, though it witnessed a sequential improvement of 214 basis points.  Given the favourable international scenario, domestic airlines likely to expand further capacities on international routes in the near future to tap the opportunity.

For the five months of the current fiscal, the domestic passenger volume witnessed a muted 2% growth year-on-year. The growth in the industry capacity (measured in available seat kilometres ASKMs) continued to be muted in August at 2.4%, primarily due to Jet Airways grounding in April. However, the domestic space will continue to remain critical for the carriers as it provides sizeable potential as well as feed-in traffic for the international routes. Also, as the airlines continue to expand their fleet, resulting in a gradual correction in the demand-supply imbalance and thus a further moderation in airfares, the domestic passenger traffic growth is expected to increase in the near-to-medium term.

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