India’s Airports Outpace Global Recovery, Set for Historic Passenger Surge

Insured Credit Rating Agency (ICRA) a leading ratings agency, has projected significant growth in India’s air passenger traffic for the current financial year (FY25), with estimates ranging from 8-11% year-on-year.

Anticipating a record high of 40.7-41.8 crore passengers, this surge is expected to drive up revenues for Indian airports, particularly those operated by the Airports Authority of India (AAI) and key private entities like Delhi, Hyderabad, and Kochi airports. Remarkably, India’s airports have already demonstrated robust recovery, with passenger traffic in 2023 surpassing pre-pandemic levels by 106%, outperforming the global average of 96%. This recovery trend has outpaced major aviation markets such as the United States, Europe, China, and the Middle East. ICRA attributes this success to a resurgence in both leisure and business travel, improved domestic connectivity, and a gradual uptick in international travel. Delhi’s Indira Gandhi International Airport (IGIA) stands out as the sole Indian airport among the top 10 global airports, achieving a passenger traffic recovery rate of 105%. This underscores the resilience and agility of India’s aviation sector amidst challenging times.

Analysts at ICRA highlight the dominance of domestic traffic in driving the recovery, a trend mirrored globally. They anticipate domestic air passenger traffic to soar to 33-34 crore in FY25, surpassing pre-pandemic levels by 120-124%. Similarly, international passenger traffic is forecasted to reach 7.7-8 crore, representing 116-120% of pre-pandemic levels. The trajectory of India’s air passenger traffic reflects a remarkable rebound from the multi-year low of 11.5 crore passengers witnessed in FY20. With FY24 recording a record high of 37.6 crore passengers, the industry has demonstrated remarkable resilience and adaptability in overcoming the challenges posed by the pandemic.

As India’s aviation sector continues its upward trajectory, bolstered by government initiatives and economic recovery, airports are gearing up to accommodate the surge in demand, ensuring seamless travel experiences for passengers and driving economic growth across the nation. “The recovery in the Indian airport passenger traffic is one of the best compared to other major global counterparts. India accounted for 4.2% of the global passenger traffic in CY2023 (calendar year 2023), and its share in passenger traffic has improved from 3.8% in CY2019. While the global passenger traffic recovered to just 96% of global passenger traffic in CY2023, the Indian airport passenger traffic revived to 106% of the pre-Covid level owing to strong economic growth as well as the addition of new airport routes. The Indian air passenger traffic is expected to outperform the global trend,” said Vinay Kumar G, Vice President and Sector Head, Corporate Ratings, ICRA .