India’s biggest airline IndiGo is operating more domestic flights on peak travel days like weekends or holidays than it did before Covid-19 on the back of increased connections to smaller cities, amid the industry witnessing a swift recovery in domestic air travel as the pandemic subsides.
“In pre-pandemic times, we had about 1,600 daily flights of which 400 to 450 were international. Currently, we have about 1,400 daily flights of which nearly 80 are international. (These numbers vary from lean to peak travel days.) The peaks are looking good. The government has allowed 100% domestic capacity and our bookings at this time are 90-95% of pre-Covid levels,” said IndiGo CEO Ronojoy Dutta.
However, flight tickets could soon be costlier due to the combined pressure of increasing jet fuel prices and a falling rupee, which has reached a point where airlines need to pass on this hike in operating cost to passengers in terms of higher fares to avoid going bust.
“Crude has gone from $43 a barrel last October to $84 now. We need some relief on taxes. Fares need to reflect higher fuel price, higher operating cost (added to by the falling rupee). Fuel is a problem and fares have to be brought higher,” Dutta said.
He explains that airlines around the world got help from their respective governments, while Indian aviation did not.
“Excise on fuel (11%) and other indirect taxes in India are very high. Airlines pay 21% indirect tax and this is effectively the highest for any industry in India because we don’t get input tax credit on fuel. This needs to be softened as we are a critical infra player,” Dutta added.
IndiGo has ordered new ‘improved, softer and more comfortable seats’ for its entire fleet, as per Dutta, in the lead up to the incoming competition from Tata-Air India.
