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Despite a boom in air travel, India’s aviation sector continues to reel under rising jet fuel prices, pilot and crew shortage, and grounded aircraft.

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India’s domestic air passenger traffic was strong in May – 15 percent higher than a year earlier and 8 percent higher than pre-Covid levels, according to ICRA’s monthly report on the country’s aviation industry. The traffic was estimated at 13.18 million for May, 2.3 percent up from April. The growth in traffic comes even as cash-strapped airline Go First suspended its flights on May 3 and is yet to restart operations.

Airlines’ capacity was higher by about 1.4 percent. The international passenger traffic for Indian carriers for the financial year 2023 stood at approximately 23.94 million, improving from the pre-Covid levels of about 22.72 million. 

Earlier this year, ICRA revised its outlook for the Indian aviation industry to stable from negative, on the back of fast-paced recovery in domestic passenger traffic. Despite a healthy rebound, the domestic aviation industry continues to face challenges due to elevated jet fuel prices. Last week, International Air Transport Association’s Director General Willie Walsh highlighted how India’s high tax structure is a drag on its aviation industry. 

Trend in capacity deployment by domestic airlines

Onora Hospitality to Open Wellbeing Resort in Manali

India-based hospitality company Onora Hospitality has announced its first wellbeing resort under its newly launched brand Bookmark Resorts. Featuring 39 rooms and suites, the resort is scheduled to open in Manali in the north Indian state of Himachal Pradesh. Aiming to open 10 Bookmark Resorts across India over the next three years, the company currently operates 20 boutique hotels and resorts with over 500 rooms in eight states under its brands jüSTa Hotels and Resorts and NUO

“Currently, wellbeing resorts in India are either at premium level and price points or at a very basic level of service. Given how people are focusing on wellbeing, we wished to bring a luxury, target-oriented, holistic wellness offering to a larger audience,” said Ashish Vohra, founder and CEO of Onora Hospitality. The company plans to achieve a revenue of $12.2 million by the end of this fiscal.

Aviation Regulator Eases Rules for Airlines to Fly International

Indian aviation watchdog Directorate General of Civil Aviation has eased norms for Indian airlines to operate flights to a new international destination. The earlier 33-point checklist has been rationalized and reduced to a 10-point checklist, the regulator said in a notification. This systemic reform comes at a time when the Indian carriers are poised to expand their international footprint, it added. Air India, IndiGo, Vistara and Akasa Air are all looking to expand their international operations. While budget carrier IndiGo is looking to start direct flights to six new destinations in Africa and Central Asia in August, Tata Group-owned Air India is looking to increase flights to Europe, West Asia and the U.S. Similarly, India’s newest airline Akasa Air is also looking to start international operations in December this year.

Oyo Launches Stay Now Pay Later Service

Travel technology company Oyo has announced a Stay Now Pay Later option to allow travelers to plan their summer trips without the immediate financial burden. Oyo has partnered with credit-based payments service Simpl for this feature, providing customers with a credit limit of up to $61, which can be settled after 15 days of the stay. The feature is currently available for Android users and will soon be rolled out for iOS users as well, it said in a statement. During a pilot conducted with 10 percent of its user base, Oyo saw payment completion rates increase by 8 percent. Over 40 percent of the users utilized the feature for transactions exceeding $25, indicating its appeal to cash-flow conscious travelers seeking a flexible payment solution

Chennai Airport Kicks Off International Operations from New Terminal

Low-cost carrier IndiGo has started international flight operations from the new integrated terminal at Chennai airport in the south Indian state of Tamil Nadu. The airline will fly to Singapore, Dubai, Saudi Arabia, Doha, Kuwait, Abu Dhabi, Kuala Lumpur and Muscat. The shifting of narrow-body aircraft operations to the new terminal started yesterday with IndiGo and the other airlines will follow later this week, according to officials of the Airports Authority of India. The widebody aircraft operations are expected to start from the new terminal by July. The new building can handle up to 30 million passengers per year from its earlier capacity of 23 million passengers.

IHCL Signs a Vivanta Hotel in Guwahati

Tata Group-owned Indian Hotels Company (IHCL) has announced the signing of a 150-key Vivanta-branded hotel in Guwahati in the northeastern state of Assam. The greenfield project is slated to open by 2026. “Vivanta Guwahati will be IHCL’s fourth hotel in Guwahati. We are delighted to partner with Asian Medical and Research for this hotel,” said Suma Venkatesh, executive vice president of real estate and development at IHCL. With the addition of this hotel, IHCL will have four hotels in the state including two under development. Last week, the company signed a 176-key SeleQtions hotel in Kumbhalgarh in the north Indian state of Rajasthan. IHCL reported its highest-ever full year consolidated revenue and a profit after tax of $122 million — a historic first for the company.

SOTC Travel Launches Website in Regional Languages

Thomas Cook India’s group company SOTC Travel has launched its website in three regional languages — Hindi, Gujarati and Tamil, in addition to English — to offer customers their language of choice as a content interface for its range of products and services. “Regional India is a critical market for us and making our website available to customers in a language of their choice, builds reassurance and deepens our customer connect. We aim to deliver exceptional customer experience and this starts right from research and booking on our regional language website,” said Daniel D’souza president and country head of holidays at SOTC Travel. 

The company’s recent India Holiday Report – May 2023 revealed that 60 percent of its customers from India’s tier 2-3 markets are displaying significant travel desire. Holidays emerging from regional India contributes to 35 percent of SOTC’s holiday business, thus making these markets key growth drivers for the company. 


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Tags: air india, air traffic, chennai, dgca, india, Indian Hotels Company, indigo, skift india report, Tata Group

Photo credit: Airlines' capacity deployment in May 2023 was higher by about 1.4 percent than that of May 2022. Mark Harris / Flickr

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