Aviation sector: Turbulence in wake of Jet Airways closure

The suspension of operations by Jet Airways, the country’s second-largest domestic airline, cast a shadow on the aviation sector’s performance in the last fiscal, with passenger traffic growth falling to a five-year low of 11.6% y-o-y in FY19. Passenger traffic had grown by 12.5-16.5% y-o-y in the 2014-18 period. Full-service carrier Jet, which had 119 aircraft in its fleet in December, 2018, suspended all operations on April 17 owing to a financial crisis. This has had a ripple effect on passenger footfall and shipment of cargo at airports—domestic air traffic fell by 4.5% y-o-y in April, breaking a growth streak of over 55 months. The top two airports—in Delhi and Mumbai—are the hardest hit by Jet’s closure as the airline had sizeable capacity deployed on tier-I routes. The two airports handle more than one-third of the total footfall at airports—of the 344.6 m passengers that used India’s 102 airports in FY19, over 118 m flew through the Indira Gandhi International Airport in Delhi and the Chhatrapati Shivaji International Airport in Mumbai in FY19.