India’s civil-aviation and inbound-tourism recovery—hailed only months ago as a post-pandemic success story—has run into a fresh head-wind. A new study released in New Delhi in the early hours of 17 April by the PHD Chamber of Commerce & Industry (PHDCCI) warns that rerouting, flight cancellations and higher jet-fuel burn caused by the continuing West Asia conflict could wipe out close to ₹18,000 crore (≈ US $2.15 bn) in airline revenue this fiscal year. According to the report, international carriers serving India have had to tack on two to four hours of extra flying time on popular corridors to Europe and North America after large swathes of Iranian, Iraqi and Jordanian airspace were shut. The longer routings are pushing fuel costs—already 35-40 % of an Indian airline’s expense sheet—dramatically higher and forcing carriers to trim frequencies or up fares. Domestic operators that rely on the Gulf for sixth-freedom traffic, crew rotations and aircraft utilisation are especially exposed, the chamber notes. Tourism is feeling the pinch as well. Arrivals in the first two weeks of April were down 15-20 % on a year-on-year basis, reversing the ‘V-shaped’ rebound of 2025 that had taken daily domestic traffic beyond the half-million mark. Hotels are reporting softer occupancy, while the restaurant sector has seen roughly 10 % of outlets shutting doors, eroding monthly turnover by an estimated ₹79,000 crore. PHDCCI urges policymakers to consider a targeted aviation-fuel tax holiday, faster GST refunds for hotels and a marketing push in less-affected source markets such as Australia and Southeast Asia. Airlines, for their part, are pressing the Directorate-General of Civil Aviation (DGCA) for temporary waivers on night-curfew slots and extended crew-duty limits so that wide-body aircraft can remain productive despite circuitous routings. Corporate-travel managers should brace for both price and schedule volatility through at least the northern-summer season. Forward contracts for bulk tickets, flexible hotel rates and alternative hubs (for example via Central Asia or Africa) are rapidly becoming best practice for firms with essential employee movements.
Source: The Economic Times
