Crisil Ratings predicts a significant surge in the share of Bharatiya airlines in international passenger traffic by the fiscal year 2028. This surge, estimated at 50%, is expected to propel Bharatiya carriers to new heights, increasing their share from 43% in 2024.
The forecast hinges on numerous factors, which include,
- the deployment of additional aircraft,
- the expansion of routes
- the advantageous domestic connectivity that Bharatiya carriers offer compared to foreign counterparts.
Crisil Ratings underscores the profitability of the international segment, noting that it surpasses the domestic market in terms of profitability. With the expected strengthening of business profiles for Bharatiya carriers due to their increased share in international traffic, the aviation industry in Bharat is poised for robust progress.
The resurgence of Bharat’s international passenger traffic is highlighted, rising from a low of 10 million in the pandemic-hit fiscal year 2021 to around 70 million in fiscal year 2024, surpassing pre-pandemic levels.
This growth trajectory, coupled with changing spending patterns favoring international leisure travel among Bharatiyas, paints a promising picture for the aviation sector.
Manish Gupta, Senior Director and Deputy Chief Ratings Officer at CRISIL Ratings, points to several factors driving this trend, including increasing disposable incomes, relaxed visa requirements, growing airport infrastructure, and enhanced air travel connectivity.
In addition, the government’s focus on positioning Bharat as a tourism hub is expected to further boost inbound traffic, adding to the positive momentum.
Looking ahead, Crisil Ratings forecasts a compound annual growth rate (CAGR) of 10-11% in international passenger traffic over the next four financial years, a significant uptick compared to the pre-pandemic CAGR of 5%.
Bharatiya airlines are strategically positioned to capitalize on this growth, with plans to capture a larger portion of the market share.
Bharatiya carriers have been proactive in expanding their international footprint, adding 55 new routes in the past 15 months, bringing their total tally to over 300. These routes include direct flights from additional cities to popular long-haul destinations in the United States, Europe, and Australia, aimed at reducing flying time and eliminating layovers for passengers.
Ankit Kedia, Director at Crisil Ratings, highlights the strategic investments being made by Bharatiya airlines to seize the opportunities presented by the growth in international travel. This includes acquiring widebody and long-range narrowbody aircraft, expanding networks, introducing new routes, and launching long-haul non-stop flights to key destinations.
With Bharat’s favorable geographic location for air connections, the nation is well-positioned to emerge as a hub for international travel in the coming years.
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