Air traffic growth may shrink by 2.5% in 2012-13

Air traffic growth may decline by 2.5% in FY13 as travel is being impacted by higher fares, grounding of Kingfisher Airlines and overall subdued consumer sentiment, think-tank CMIE said.

"We expect total passenger traffic to decline by 3.2% year-on-year in the second half of FY13. In 2012-13 as a whole, the passenger traffic growth is expected to fall by 2.5%," city-based Centre for Monitoring Indian Economy (CMIE) said in its report. Even the DGCA data for the January-November period, released recently, shows a 3% negative growth during the period.

According to the DGCA data, the total number of passengers carried by the domestic airlines in the first 11 months of the fiscal stood at 534.14 lakh, marginally less than 550.33 lakh fliers during the corresponding period of the previous year. Domestic passenger traffic accounts for almost 72-74% of the total air passenger traffic.

Observing that the air traffic scenario is expected to remain dull in the coming months, which happens to be the lean period for the domestic carriers, the CMIE report said the factors such as higher air fares, capacity reduction due to the suspension of Kingfisher Airlines' licence are likely to have their impact on the growth in the second half of the fiscal.

Quoting the data put out by the Airports Authority of India, the report said air traffic growth in April-September period reflected a 1.8% fall at 77 million passengers compared with 78.4 million passengers handled by the country's airports in the same period a year ago. CMIE attributed this decline in growth to factors such as global economic slowdown, sharp increase in air fares and capacity reduction by operators particularly grounding of the Kingfisher Airlines since October, it said.

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