Airlines expect 10% passenger growth

New Delhi: Rise in corporate travel and low fares the drivers; 26 per cent growth in August raises hopes.
After being in the doldrums for over a year, the $14-billion Indian aviation industry is showing signs of recovery. Carriers, as well as experts, expect 10 per cent growth in passenger traffic against their earlier prediction of not more than 5 per cent.
Last year, passenger numbers dropped 10.5 per cent. In August, domestic sector traffic rose 26 per cent year-on-year, which is the first time in almost a year that a double digit growth has been recorded.
“After registering a fall of 10.5 per cent in 2008-09, the industry was expected to grow marginally. But considering the growth registered in the last three months, it is poised to grow by 10 per cent this fiscal,” said Mahantesh Sabarad, a senior aviation analyst with Centrum a leading financial company.
However there are others who are more optimistic. “The growth in the aviation industry would be one and a half times the gross domestic product. With good times around, the sector is going to witness 14-15 per cent growth,” said Rajeev Batra, executive director, KPMG.
Airlines say various factors are behind the revival. Corporate travel, which is nearly 30 per cent of the business, is limping back to normalcy. Airlines have been able to keep rates low. The average airline ticket price has come down from Rs 3,956 in 2008 to Rs 3,400 in 2009.
“This rise in the numbers has come because of lower fares and it remains to be seen how much the airlines would be able to take forward the lower fares,” said Ajay Prakash, general secretary, Travel Agents Federation of India.
21/09/09 Mihir Mishra/Business Standard

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Categories: Indian Aviation- In General Sep 2009