Indian Aviation Faces Bumpy Start to Fiscal 2026, But Outlook Stays Stable
Photo Credit: Air India's A350 aircraft with the new livery. Air India
Skift Take
India’s air travel grew year-on-year in April, but month-on-month traffic and capacity fell. ICRA sees stable growth ahead, though airline losses and geopolitical risks remain watchpoints.
The domestic air traffic in April was over 10% higher year-on-year. However, there was a decline compared to March 2025 - down from 14.88 million to 14.55 million, according to data from credit ratings agency ICRA.
ICRA also noted that the airlines’ capacity deployment in April declined by 4.2% compared to the month before.
During the 2024-25 financial year, the air passenger traffic increased 7.6% year-on-year. The traffic was also nearly 17% up from pre-Covid levels. ICRA said that the year-on-year growth was moderate “given the high base of the 2024 financial year and lower passenger traffic in the first half of the 2025 fiscal, impacted by severe heat waves and other weather-related disruptions.”
Forecast for 2025-26: Despite the decline in April, the credit ratings agency maintained a stable outlook for the industry, driven by moderate growth in traffic and a relatively stable cost environment.
ICRA projected that domestic
