Key shifts that are defining the Indian aviation industry

The international segment has crossed a key historical level that augurs well for future growth. With fuel prices also tumbling, airlines are in decent shape going into the lean season. Here are five takeaways from the latest data coming out of the aviation sector.

Airports: Mumbai relief

On 28 May, IndiGo said it would kick off flights at the second airport in Mumbai, the upcoming one at Navi Mumbai, with 18 daily domestic departures, or 36 aircraft movements. Further, it estimated increasing this to 79 daily departures (158 aircraft movements) by November. While neither the airline nor the airport announced the exact date of the first flight, this is reported to be in June or July.

For Mumbai, the new airport is a capacity relief that is overdue. The existing airport has been operating at capacity for some years now. Even if airlines wanted to add more flights, the airport didn’t have slots to offer them. Meanwhile, Bengaluru has crept up on Mumbai in the second slot in domestic flights, even overtaking it this March and April. How much of this is due to Bengaluru’s own brisk growth and how much due to Mumbai’s capacity constraints will become clear once the Navi Mumbai airport stabilises.

Airlines: Catch the leader

For IndiGo, the leader in domestic aviation in India, the commissioning of the Navi Mumbai airport will give it more scope for expansion. Ever since its inception in 2006, it has been chipping away, adding planes, destinations and connections. In the process, it has been weaning away market share from other airlines, several of which pursued more aggressive and front-loaded expansions. Following a purge and consolidation, Indian aviation is now principally a two-horse race between IndiGo and the Air India Group.

The consolidation was led by the Tatas-owned Air India Group, with two sets of mergers in late 2024. The latest data shows that the Air India Group has lost domestic share—albeit in a growing market—to IndiGo in 2025. One reason could be Air India opting to refurbish some of its fleet. A lot of this refurbishment is expected to be completed in stages in 2025—while IndiGo expands.

International: Tier-2 pick-up

For the period from January to March 2025, IndiGo posted its best-ever fourth quarter, returning a net profit of ₹3,067 crore. In addition to the domestic segment, IndiGo has also been expanding steadily in the international segment. It increased its international passenger share from 18.2% in the December 2023 quarter to 19.4% in the December 2024 quarter, the latest for which such data is available.

At the airport level, movements of international flights increased 9.4% in 2024-25. Delhi and Mumbai grew 7-8%. Of the 46 airports that saw international traffic in 2024-25, 16 grew above 20% in flight movements. These 16 airports account for only 14% of all international movements, they embody the widening of the international pie—from the main metros to tier-II metros. Nine of them recorded at least 1,000 international aircraft movements in 2024-25, and Bengaluru is the only main metro airport among them.

Pairings: Pandemic recovery

Such pockets of strong growth underpin the recovery of the international segment. According to data from the Indian regulator, there were 346 destination pairings (for example, Delhi-Dubai is one pairing) in the international segment in the October to December 2024 quarter, the latest available for this data. In the last quarter of the calendar year, this is the first time since the pandemic that the number of destination pairings has crossed the pre-pandemic high registered in the December 2018 quarter.

Take Bengaluru, the largest of the set of 16 airports in 2024-25, with more than 1,000 international flight movements and above 20% year-on-year growth. It went from 21 active international pairings in the December 2023 quarter to 25 in the December 2024 quarter, with the additions being Denpasar, Langkawi, Phuket and Port Louis. Similarly, Lucknow went from 8 to 11, and Jaipur from 4 to 5.

Fuel: Bottomline benefit

Similar growth is also seen in the domestic segment—9.1% in passenger growth in 2024-25. All three leading Indian airlines—IndiGo, Air India Group and Akasa—are acquiring new aircraft and have a healthy order pipeline. Besides a steady operating environment, the current outlook on oil prices is also favourable. In the past year, the price of Brent crude has dropped by about 23 % per barrel. In the same period, the price of domestic aviation turbine fuel (ATF) at Delhi’s Terminal 3 has dropped about 16%.

Also Read: IndiGo’s Q1 turbulence to be temporary as crude oil prices soften, capacity grows 

Fuel is the biggest cost head for airlines, and a drop in prices boosts their bottom lines. In the March 2025 quarter, IndiGo’s fuel cost as a share of revenues was 30.5%. By comparison, in the September 2024 quarter, which is a lean season and when ATF prices were higher, it was 39%. As the lean season approaches, they will hope for fuel prices to stay low.

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