NEW DELHI: Air travel in India registered a 59% growth annually in financial year 2022, but it is lower than 40% from pre-Covid levels, while elavated ATF prices aggravated by geo-political tension in Russia and Ukraine will remain a near-term challenge and a key determinant of profitability for the industry, said a report by rating agency Icra.
The ATF prices have surged by 93% on a year-on-year basis in April 2022, given the elevated crude oil prices, due to the geo-political issues arising from the Russian invasion of Ukraine. The rising ATF prices continue to play spoilsport for the industry and will pose a serious threat to the sector earnings in FY2023.
As a support measure for the Indian aviation industry, the government recently announced extension of the ECLGS by one year and increased the quantum of support, along with lower cost of funds for accessing non-fund-based limits.
