Indian aviation market facing fierce competition
India was one of the fastest growing aviation markets in the world, but the growth turned negative in April on account of the Jet Airways crisis. Indian airlines is facing fierce competition and the cost environment is also not in their favor. Currently, India has two operational carriers- Vistara and Air India.
At the annual general meeting, IATA’s director general and chief executive officer concluded that adverse conditions such as fluctuation in rupee against the US dollar were putting pressure on the profitability of airlines.
IATA tells that the Indian market is tough due to the macroeconomic conditions such as oil prices, rupee, etc. Jet Airways which has a significant number of domestic and international flights temporarily suspended its operations in April as it ran out of cash.
The global airline is expected to make a profit of $28 billion this year much lower than the earlier forecast of $35.5 billion due to change in the conditions. However, IATA has expectations from the new government that came into power recently to lower the prices and tax evasion practice.