The growth in the aviation sector has been low key in 2018. Weakening of the Indian rupee put a strain on airlines as the cost of the main input, air turbine fuel (ATF), soared. IndiGo which is the market leader in domestic aviation reported losses. Jet Airways has not been able to pay salaries owing to its financial condition.
The UDAN scheme, which was meant to revive unserved and underserved routes, has been unable to lift the spirits of the aviation leaders. While SpiceJet, IndiGo and Air Alliance (subsidiary of Air India) have gradually scaled up operations, smaller airlines are struggling. Air Odisha and Air Deccan did not even have the aircraft at the time of bidding.
The government has cancelled a number of routes awarded to Air Odisha and Air Deccan in the first round of route bidding as they could not start operations despite show-cause notices. Air Odisha is facing problems in getting investors. Read More