Summary:
India’s air passenger traffic is forecasted to grow by 7% in 2025, fueled by the rising middle class and the increasing accessibility of air travel. This positive projection was highlighted by Joshua Ng, Director at Alton Aviation Consultancy. With India accounting for 10% of Asia-Pacific’s total domestic and international air traffic, the country has successfully returned to its pre-pandemic travel levels. The government’s initiative to construct 150 new airports further demonstrates its commitment to advancing the aviation sector. He further pointed out that Indian airlines' substantial order book of nearly 1,900 aircraft will significantly enhance capacity and support future expansion. Additionally, the planned merger of Air India and Vistara is expected to strengthen market stability, positioning Air India as a prominent full-service carrier, while IndiGo continues to lead in the lowcost airline category.
Globally, air travel has also rebounded to pre-pandemic levels. The aviation industry is projected to maintain a steady annual growth rate of 4% from 2024 to 2034, driven by a 2.7% yearly rise in global Gross Domestic Product (GDP). The Asia-Pacific region, particularly China and India, is expected to experience accelerated growth at a rate of 5.1% per year. However, challenges remain within the industry. A significant backlog of aircraft deliveries, estimated at 9.7 years according to the Centre for Aviation (CAPA) and Alton’s analysis, poses supply chain constraints. While passenger volumes and revenues are anticipated to achieve record highs in 2025, airlines must contend with risks including normalising ticket prices, inflationary pressures and geopolitical uncertainties. The aftermath of COVID-19 has further exacerbated supply chain disruptions and labor shortages. To navigate these issues, airlines are adopting measures such as optimizing aircraft utilization, reducing turnaround times and leveraging wet-leasing agreements to maintain operational efficiency.
Source: IBEF
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