Friday, 12 Sep, 2025
By: Anshul Vipat
The entry of Akasa Air and Jet Airways in the already saturated market will help the industry gain momentum in terms of growth and scalability
An intense battle for market share in the world’s third-largest domestic aviation market is hitting up as the country's aviation market gets ready to welcome two more players— low-cost carrier (LCC) Akasa Air, which recently commenced its operations; and the re-launch of Jet Airways later this year. The entry of the two players in the already saturated market will help the industry gain momentum in terms of growth and scalability. This along with Air India buyout to a growing optimism in India's airline sector.
Another move that is heating up the aviation sector is government’s recent move to remove the fare caps it had imposed on domestic airlines in 2020 during the pandemic at the end of this month, the country’s civil aviation ministry said, lifting restrictions that will allow carriers to raise fares as well as offer deep discounts. The government had imposed minimum and maximum fares prevent ticket prices from spiking when air travel was reopened following the lockdowns in 2020.
Entry of Akasa Air
Backed by the recently deceased Rakesh Jhunjhunwala, Akasa Air looks to make a name as ultra-low-cost carrier (ULCC), a model not tested before in India. According to experts, Akasa's strategy includes targeting less-travelled destinations at less expensive fares by keeping the seat fares separate from all other related services like food. The airline plans to scale up to a fleet of 20 aircraft (which includes Boeing 737 MAX airplanes) within 18-20 months of launching commercial operations. A younger fleet ensures fuel efficacy and less maintenance costs.
The return of Jet
Another player that is set to disrupt the sector is Jet Airways. The airlines which once ruled the skies a decade ago was grounded in April 2019 due to steep financial losses. Last month, the airlines received its revalidated AOC from the DGCA, ending months of speculation over its fate. It plans to start operations by the end of this year. Entry of the three-decade old company will infuse a fresh lease of life in commercial aviation sector.
The last two years were quite painful for the aviation sector, with the Covid-19 pandemic, high fuel prices, and human resource shortages leaving air players with huge losses and debt burdens. Slowly and gradually, the airline industry is inching towards normalcy. In May 2022, domestic and international air passenger traffic reached 93% and 72%, respectively, a level last seen during May 2019.
Although there was a dip of 12.6 percent in passenger traffic in June primarily due to the seasonality impact. On a monthly basis, the passenger air traffic growth rate domestically soared to 238 percent in June this year over the same month a year ago, data showed. Domestic traffic is likely to fully reach pre-Covid levels by FY23 end or the beginning of FY24.
