Aviation sector’s financial woes to be more visible in Sept-Oct: CAPA India

Mukesh Ranjan

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Tribune News Service

New Delhi, August 5

Aviation monitoring body CAPA India has warned that unwillingness of promoters, bankers and the government to provide financial support to the country’s aviation sector would badly impact air connectivity and in turn the economic recovery path. It has also said that the industry’s financial challenges will become increasingly visible from September-October this year.

“The industry’s financial challenges will become increasingly apparent from September-October. Promoters, bankers, private equity, and government are all unwilling to provide support given demand risk & uncertainty,” CAPA India said in a statement.

The monitoring body also insisted that this could have “an unprecedented impact on air connectivity and on economic recovery”, as the two critical elements for the industry to survive and navigate this crisis are “demand (traffic risk) and capital”.

Airports in the country, including Delhi, Bangalore, Hyderabad, Chennai, Kolkata, Mumbai and others, have recorded poor passenger traffic and flight operations. Domestic flight operations plunged to historic lows of nearly 70-80 percent in June.

Giving a countrywide picture, the airports Authority of India (AAI) said that domestic aircraft movements at all the airports witnessed a decrease of 87.5 percent during (April-June) 2020-21 as compared to (April-June) 2019-20.

The airlines, which were flying with nearly 80-90 percent of capacity in pre-Covid time, are barely getting fliers to fill even 50-60 per cent seats.

Indigo, largest budget carrier in the country recorded nearly 60 percent passenger load factor (PLF) during June this year as against 90 percent last year. National carrier Air India recorded 56 percent PLF as against 81 percent in June last year.