Airlines trim capacity on key Southeast Asian routes

According to data from aviation analytics firm OAG, combined seat capacity on routes connecting India with the three countries fell to 674,245 seats in June 2026 from 768,678 seats in the same month last year.

Thailand, India’s second-largest international country market after the UAE, witnessed a 10.3% decline in capacity, with seats dropping to 266,490 from 297,058 a year ago. Capacity between India and Singapore, the third-largest overseas market for Indian travellers, fell 12.3% to 249,286 seats from 284,194 seats.

Malaysia recorded the steepest decline among the three, with seat availability falling 15.4% to 158,469 seats from 187,426 seats.

The decline is notable given Southeast Asia’s significance in India’s outbound travel landscape. Thailand, Singapore and Malaysia have consistently ranked among the most sought-after destinations for Indian leisure and business travellers, supported by short flight durations, strong airline connectivity and favourable travel policies.

The reduction in capacity also comes at a time when India’s overall international aviation market continues to expand. OAG data shows international seat capacity from India rose 9.6% year-on-year in June to 7.9 million seats, indicating that growth in overseas connectivity is increasingly being driven by markets outside these traditional Southeast Asian hubs.

The latest data indicates that while demand for overseas travel remains robust, Southeast Asia is accounting for a smaller share of India’s international capacity growth than it did in previous years.

The decline in Southeast Asian capacity comes as some long-haul markets such as the UK continue to expand. Capacity between India and the UK rose nearly 19% year-on-year in June, suggesting airlines may be increasingly deploying aircraft on routes that typically generate higher yields than short-haul leisure destinations.

Industry observers said airlines continue to face fleet-related challenges, including delayed aircraft deliveries and engine-related groundings, forcing carriers to optimise network deployment and prioritise routes where capacity utilisation and returns are stronger. Such constraints have affected network planning across the industry over the past year.

The latest figures suggest airlines have become more cautious in adding capacity on Southeast Asian routes after a period of rapid post-pandemic expansion. Following the reopening of international travel, destinations such as Thailand and Singapore witnessed a strong rebound in Indian tourist traffic, prompting carriers to significantly increase frequencies and deploy additional aircraft.

However, the pace of capacity growth on these routes appears to have moderated. The simultaneous decline across all three major Southeast Asian markets points to a broader recalibration rather than a destination-specific issue.

Despite the reductions, Thailand and Singapore remain among India’s largest international aviation markets, underscoring the region’s continued importance for airlines and travellers alike.