Is India's Domestic Airline Passenger Traffic on the Rise?
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Synopsis
India's aviation sector shows resilience with a year-on-year rise in domestic passenger traffic by 0.3% in August. Analysts predict a stable future with modest growth expected. Discover how the industry is navigating operational challenges and what the future holds in this insightful report.
Key Takeaways
- 0.3 percent increase in domestic passenger traffic in August 2025.
- ICRA projects 4 to 6 percent growth for FY2026.
- Domestic air traffic for FY2025 reached 1,653.8 lakh.
- International passenger traffic grew by 14.1 percent.
- Current challenges include engine failures and supply-chain disruptions.
New Delhi, Sep 26 (NationPress) The aviation sector in India has demonstrated remarkable resilience, even amidst various operational hurdles, as domestic passenger traffic saw a 0.3 percent increase in August compared to the previous year, according to a recent report.
Credit rating agency ICRA has projected a stable outlook for the industry, anticipating a modest growth of 4 to 6 percent in domestic air travel for FY2026.
Analysts have pointed out that the decline in aviation turbine fuel (ATF) prices and robust yields will aid airlines in navigating short-term challenges, despite ongoing issues related to supply-chain disruptions and engine failures.
In August 2025, domestic air passenger numbers reached 131.7 lakh, up from 131.3 lakh in August 2024, indicating a 0.3 percent year-on-year growth. Sequentially, passenger traffic increased by 4.5 percent.
For the first five months of FY2026, domestic air traffic totaled 677.5 lakh, reflecting a 2.2 percent year-on-year growth.
In FY2025, domestic air travel hit approximately 1,653.8 lakh, showing a significant 7.6 percent increase. Additionally, international passenger traffic for Indian airlines surged by 14.1 percent, reaching 338.6 lakh.
ICRA has adjusted its forecast for international passenger traffic growth for this fiscal to 13–15 percent, down from the previously estimated 15–20 percent, citing concerns surrounding cross-border tensions and travel hesitancy following a recent aviation tragedy. In September 2025, ATF prices experienced a 1.4 percent decline on a sequential basis.
The industry has been grappling with engine failures and supply-chain issues, which have led to grounding a significant portion of fleets, consequently increasing costs through wet leases and maintenance.
Moreover, in FY2025, challenges regarding pilot and cabin crew availability resulted in numerous flight cancellations and delays. However, strong yields, high passenger load factors (PLF), and partial compensation from engine manufacturers are somewhat mitigating these impacts.
Point of View
It's crucial to acknowledge the resilience of India's aviation industry, which, despite facing numerous operational challenges, continues to show signs of growth. The expectations for modest growth in the upcoming fiscal year reflect a positive trend, which is essential for maintaining national connectivity and economic stability.
NationPress
26/09/2025
Frequently Asked Questions
What is the percentage increase in domestic air traffic in August?
The domestic passenger traffic increased by 0.3 percent in August 2025 compared to the previous year.
What is the forecast for domestic air passenger traffic growth?
The forecast for domestic air passenger traffic growth is projected at 4 to 6 percent for FY2026.
How many domestic air passengers were recorded in August 2025?
In August 2025, the domestic air passenger traffic stood at 131.7 lakh.
What challenges is the aviation industry currently facing?
The industry is facing challenges such as engine failures, supply-chain disruptions, and pilot shortages.
What was the international passenger traffic growth for Indian carriers?
International passenger traffic for Indian carriers rose by 14.1 percent to reach 338.6 lakh.
