India's domestic air passenger traffic grows 1.4 pc to 1,677.4 lakh in FY26: Report

India's domestic air passenger traffic grew 1.4 per cent year-on-year to 1,677.4 lakh in FY26, in line with the Icra's estimate of 0-3 per cent, the agency said on Tuesday. All Indian airlines together had flown a total of 1,653.8 lakh passengers in FY25. For March this year, the domestic air passenger traffic rose 1 per cent year-on-year to 146.8 lakh, Icra said. The airlines' capacity deployment in March 2026 was 3 per cent lower than a year earlier, the agency said, adding that it is estimated that the domestic aviation industry operated at a passenger load factor of 89.5 per cent in the reporting month compared to 86 per cent in March 2025. International passenger traffic for Indian carriers in February this year stood at 28.5 lakh, a decline of 0.3 per cent year-on-year and a sequential fall of 16 per cent. For the April-February period of the previous fiscal, it was seen at 331.5 lakh, a growth of 7.7 per cent, Icra said. Noting that the average aviation turbine fuel prices announced on April 1, 2026, increased by 9.2 per cent on a sequential basis and by 18.2 per cent on a year-on-year basis on account of the impact of the West Asian conflict, the ratings agency said that while crude oil prices rose sharply (by 45.5 per cent month-on-month in March this year) due to the geopolitical crisis, the pass-through to ATF prices was moderated. Although the civil aviation ministry capped domestic ATF price increases at 25 per cent sequentially, the oil marketing companies raised ATF prices by only 9.2 per cent sequentially in April 2026 for domestic operations, tempering the immediate cost impact on the aviation sector. Nonetheless, crude oil prices remain elevated, which can impact ATF prices in the future, it said, adding that the continuous weakening of the rupee against the US Dollar is another concern.

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