India's air passenger traffic in February fell by 37pc from a year earlier and was near flat against January, as higher fuel prices and the end of the festival period weighed on activity.
Passenger traffic totalled 7.8mn in February, marginally higher from 7.73mn in January, according to industry data and the Directorate General of Civil Aviation. Traffic in January had dropped by around 39pc from a year earlier. Capacity deployment at 71pc in February was near flat from January but higher from 59pc in November.
The government now allows airlines to operate domestic routes at 80pc of their capacity but has barred international flights until the end of March because of a resurgence of Covid-19 cases.
India increased prices of jet fuel for the first half of March by 7pc from the second half of February to 59,401 rupees/kilolitre ($810/kl), according to state-controlled refiner IOC. Fuel constitutes around 40pc of costs for Indian carriers prompting them to consider increasing fares after every fuel price hike.
State-run airline Air India owes around Rs30bn to state-run refiners IOC, Bharat Petroleum and Hindustan Petroleum. The refiners have suspended sales of jet fuel in the past because of outstanding payments but then resumed supplies following government pressure and partial payments. Air India's privatisation has been delayed with only domestic conglomerate Tata Group and budget airline Spice Jet showing interest in the national carrier.
09/03/21 Argus
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