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International passenger traffic at Indian airports to hit 80-85% of pre-Covid level: Icra

AME QUESTION PAPERby AME QUESTION PAPER
June 7, 2022
in NEWS
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Credit ratings agency Icra on Monday revised upward its projection of international air passenger traffic at Indian airports at 80-85 per cent of the pre-pandemic volumes during this fiscal. The volume of such travelers has already touched 72 per cent of the pre-Covid level in May.

The steep recovery in international passengers’ demand came on the back of resumption of scheduled flight operations in late March in the wake of easing of travel restrictions norms and resilient passenger demand, Icra said in a release.

Major destinations driving the international traffic demand are Southeast Asia, the Middle East and Europe, it said.

Commercial operations of international flights resumed on March 27 after a hiatus of two years amid COVID-19 pandemic. During that period international operations were limited to countries through special flights under the ‘Vande Bharat Mission’ and bilateral ‘air transport bubble’ agreements with several countries.

The ramp-up is healthy with international passenger traffic reaching 63 per cent and 72 per cent of pre-Covid levels (similar period in 2019) in April and May, respectively, this year compared to the recovery of less than 50 per cent to that of pre-pandemic levels during FY22, the ratings agency said.

Icra said it also expects the ramp-up in the overall passenger traffic to 96-97 per cent of the pre-Covid levels in FY23 on the back of a strong and sharp recovery in domestic passenger traffic and the resumption of international commercial operations.

The recovery in domestic passenger traffic was strong post-Omicron and has reached 98 per cent of pre-Covid levels in April and May, it said, adding, overall, passenger traffic has reached 93 per cent of pre-Covid levels in May.

“Resumption of international commercial operations has accelerated the traffic recovery. Considering the healthy ramp-up in international traffic in the last two months, Icra expects international traffic to reach 80-85 per cent of the pre-Covid level in FY23 as against earlier estimates of 70-75 per cent,” said Abhishek Lahoti, senior analyst, for corporate ratings at Icra.

Further, as expected, the recovery of domestic passenger traffic was sharp and much faster post-Omicron, he said.

The recovery trend in traffic was supported by the easing of travel restrictions norms and resilient demand, according to Lahoti who expects domestic air travel to recover back to pre-Covid levels in FY23 and the international traffic in FY24.

 

 

 

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