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Thursday, October 21, 2021

Domestic flights: As demand soars, govt lifts capacity curbs

Currently, airlines are operating at a capacity of 85 per cent. It was gradually relaxed to this level following the 33 per cent cap in May 2020 and a slight dip in allowed capacity during the second wave of Covid-19 in the country.

Written by Pranav Mukul | New Delhi |
Updated: October 13, 2021 6:13:11 am
On October 9, the Indian carriers operated 2,340 domestic flights, which is 71.5 per cent of their total pre-COVID capacity. (File)

The Ministry of Civil Aviation on Tuesday allowed airlines to operate 100 per cent of their scheduled capacity October 18 onwards, removing a key restriction imposed when domestic flight operations resumed in May 2020 after a two-month lockdown. However, restrictions on fare bands continues to be in place.

“After a review of the current status of scheduled domestic operations vis-a-vis passenger demand for air travel … it has been decided to restore the scheduled domestic air operations with effect from 18.10.21 without any capacity restriction. The airlines/airport operators shall, however, ensure that the guidelines to contain the spread of COVID are strictly adhered to and COVID appropriate behaviour is strictly enforced by them during the travel,” the ministry noted in an order.

Currently, airlines are operating at a capacity of 85 per cent. It was gradually relaxed to this level following the 33 per cent cap in May 2020 and a slight dip in allowed capacity during the second wave of Covid-19 in the country.

On October 10, domestic passenger numbers clocked at 3.04 lakh, crossing the 3 lakh per day mark for the first time since February 28 this year, when 3.14 lakh passengers had traveled on domestic flights. Industry executives have pointed out that the capacity restrictions were well past serving their purpose, and this comes as a positive for the industry ahead of the festival season.

“We are already witnessing significant demand for forward bookings for the upcoming season, and the industry is operating at a 70 per cent plus capacity for the last few days, so it was expected that the government would relax the restrictions. But it’s also about time the fare bands are done away with. These restrictions were brought in to prevent airlines from overheating and selling far below costs after the lockdown was lifted but there’s real demand now and a fare floor and a ceiling make no sense,” a top executive at a low-cost airline said.

The two biggest airports in the country, Delhi and Mumbai, have also geared up for the rebound in air traffic by announcing reopening of terminals that were closed on account of low footfall earlier.

Delhi Airport announced that operations at Terminal 1 would resume from October 31, almost 18 months after closure, with IndiGo and SpiceJet. Mumbai Airport, which witnessed chaos and flight delays last week on account of sudden increase in traffic, preponed the resumption of its Terminal 1 to Wednesday from the earlier date of October 20.

IndiGo, in a statement, said, “We are pleased with government’s decision to allow airlines to operate with full capacity without any restrictions from October 18. It is a welcome move as we believe that with recent pent-up demand combined with the upcoming festive season, it will be great to operate flights on pre-pandemic levels. We are quite bullish about the overall growth and demand for domestic travel.”

Suprio Banerjee, vice president and sector head, ICRA, said this is a step in right direction, “given on a sequential basis from June 2021 there has been a steady rise in domestic passenger traffic on month-on-month basis, reflecting pick up in leisure and corporate travel to an extent compared to necessary travel when the second wave of Covid-19 hit. Moreover, with onset of the festive and tourist season generally seen towards the calendar year end, 100 per cent permissible capacity will allow the airlines to serve a wider market and in turn will encourage air travel.”

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