India air traffic gains momentum as travel season begins

MUMBAI (NewsRise) -- India's domestic airline traffic continued to grow in double-digits in November, buoyed by the onset of the main travel season, even as concerns linger over rising fuel prices and crippling airport infrastructure. The number of passengers flown last month jumped almost 17% on year to 10.5 million, according to government data.

Air travel in India traditionally records a spurt from October through March, rebounding from a lean period in the previous months. Air travel in Asia's third-largest economy has grown at an annual pace of more than 20% in the past few years as rising incomes and the advent of no-frills carriers prompted more people to shun trains for long-distance travel.

Last year, India became the largest aviation market behind the U.S. and China with domestic traffic touching 100 million passengers.

"We are optimistic that this double-digit growth will continue in the coming months, driven by economical ticket prices, increasing capacity, and a number of long weekends," said Sharat Dhall, chief operating officer at travel portal Yatra.com.

However, some analysts warn that the pace of annual growth may moderate to 13%-15%, amid rising congestion at Indian airports. Aircraft often spend up to an hour longer in skies due to the shortage of landing slots. 

Carriers such as InterGlobe Aviation's IndiGo, Jet Airways (India), and SpiceJet have ordered aircraft worth billions of dollars, threatening to worsen the airport congestion. Indian airlines, which operate about 500 aircraft, have ordered an additional 1,000 planes, according to an estimate by HSBC.

"The bigger problem, however, is the severe congestion at airports metastasizing into structural gridlocks," said Prasad Koparkar, senior director at Crisil Research. "Mumbai and New Delhi airports, from where 63% of domestic passenger traffic either originate or terminate, are edging towards capacity crunch during peak hours, which is amplifying the infrastructure constraints."

Between January and November, domestic airlines have carried about 106 million passengers, up more than 17% from a year earlier, the government data showed.

IndiGo filled nearly 91% of its seats in November, compared with 87% in October, while state-owned Air India saw its so-called load factor rise to 84% from the previous month's 77%. Jet Airways filled 87% of its seats, more than the 81% in October.

Third-ranked SpiceJet filled almost 96% of seats, while the load factor at India's newest carrier Vistara rose to 87%. Budget airline AirAsia India saw its load factor expand to 85%.

--Dhanya Ann Thoppil

Source: India air traffic gains momentum as travel season begins