IndiGo: Geopolitical Risks Cloud Indian Aviation Outlook

New Delhi, Jul 28 (PTI) Indian aviation's outlook for the current financial year remains highly sensitive to geopolitical uncertainties and the volatility in crude oil prices, while foreign exchange rates continue to pose significant risks to airline cost structures, according to IndiGo.

In its annual report for 2025-26, IndiGo said that ongoing conflicts in West Asia have resulted in intermittent airspace restrictions, leading to higher operating costs on certain international routes.

"These challenges may also cause schedule disruptions or temporary suspension of services," the airline said.

IndiGo is the country's largest airline and had a domestic market share of 66.3 per cent in June. The carrier is also expanding its international network.

"The outlook for Indian aviation in FY 2027 remains highly sensitive to geopolitical uncertainties," the report said.

IndiGo Managing Director Rahul Bhatia, in his message in the report, said fuel remains one of the largest cost components for any airline and volatility in global energy markets continues to create significant operating uncertainty.

Further, Indian aviation has been adversely impacted by airspace closures for over a year, he said, adding that in parallel, ongoing supply chain constraints affecting aircraft production, engine availability, maintenance cycles, and component sourcing have placed pressure on airlines' expansion plans globally.

"Foreign exchange volatility, particularly in emerging markets where capital costs are denominated in foreign currencies, remains an important consideration," he noted.


About the future path, Bhatia said the next decade will represent the most significant phase of international expansion in our history.

"We are investing in fleet, technology, infrastructure, digital capabilities, and talent to build a truly global aviation network originating from India," he said.

Among other efforts, IndiGo has realigned its fleet plan to progressively increase the share of owned or finance-leased aircraft from around 20 per cent of its current over 400 aircraft fleet to about 30-?40 per cent of a projected 600-plane fleet by 2030.

"Despite cyclical disruptions, long-term structural demand for connectivity continues to strengthen, particularly in high-growth economies such as India. We therefore remain focused on navigating near-term challenges with prudence and discipline while preparing the airline for long-term expansion," Bhatia said.

According to him, aviation has historically demonstrated remarkable resilience, and despite cyclical disruptions, long-term structural demand for connectivity continues to strengthen, particularly in high-growth economies such as India.

"We therefore remain focused on navigating near-term challenges with prudence and discipline while preparing the airline for long-term expansion," Bhatia, also the Co-Founder of IndiGo, said.

Meanwhile, in December last year, IndiGo witnessed massive flight disruptions due to issues related to the implementation of revised Flight Duty Time Limitation (FDTL) norms.

"The operational disruption experienced during the first week of December was an extremely challenging time for both our customers and IndiGo employees," Bhatia said.