Clouds get thicker over aviation sector; passenger traffic to fall more rapidly than earlier estimates

By: |
April 21, 2020 3:43 PM

Airlines passenger traffic may contract up to 30% in the current fiscal, which was 13.7% during FY19 and 3.7% during FY20 (till February).

airlines, aviation sector, airlines traffic, airports, coronavirus, airlines woesThe aviation sector is severely hit by the travel restrictions imposed to contain the coronavirus pandemic.

The dark days of India’s aviation sector, with all its planes grounded, are expected to prolong in the current fiscal. It is estimated that the airlines passenger traffic may contract up to 30 per cent in the current fiscal, said a report by Care Ratings. The contraction in airlines traffic was earlier estimated at 20-25 per cent, which has now worsened due to a rapid increase in Covid-19 cases and anticipation that the lockdown may continue for some time. Passenger growth has been 13.7 per cent during FY19 and 3.7 per cent during FY20 (till February). The aviation sector is severely hit by the travel restrictions imposed to contain the coronavirus pandemic. 

With the rapid spread of Covid-19 and with more undetected clusters getting converted into corona hotspots, the tenacity of the end of the pandemic is uncertain and is showing no signs of abating, added Care Ratings. The report also predicted that the lockdown which is supposed to end by 3 May 2020 is most likely to get extended as the number of cases is on the rise and certain states are unable to flatten the curve of transmission.

Also Read: No penal interest on farm loan dues in moratorium; RBI extends interest subvention benefit to farmers

Adding to the airlines’ woes, the metros that account for more than half of the passengers are the worst affected by the pandemic. In the 10 months last year, Delhi Mumbai, Bangalore, Chennai, Kolkata, and Hyderabad airports accounted for 63 per cent of the passengers handled, the report added. While the manufacturing sector and other services are waiting for the lockdown to be lifted t kickstart their operations, the aviation sector has low hopes even after that. The reason being inhibitions of travelling till the pandemic scare has been settled fully in the domestic regions and internationally especially on certain routes.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.

Next Stories
1Gold loans account for 35% of our loan book and can go up to 45%: CVR Rajendran, Managing Director & Chief Executive, CSB Bank
2Reliance Jio develops 5G solution with Qualcomm
3Delhi HC restrains Canara Bank from flouting SC’s NPA relief order