International flights from India may see a drop in prices in the coming days

Advertisement
International flights from India may see a drop in prices in the coming days
International flights from India may see a drop in prices in the coming daysCanva
  • Sixty foreign airlines from 40 countries can now fly to India after two years of restrictions.
  • The government of India has decided to increase the number of flights to 3,200 a week.
  • Experts believe that airfare corrections are expected as airlines are now slowly beginning to increase their capacity.
Advertisement
The government of India had resumed all international flights from Sunday onwards and it may lead to a slight dip in the airfares in days to come.

Sixty foreign airlines from 40 countries — including Mauritius, Malaysia, Thailand, Turkey, US and Iraq, among others — can now fly to India after two years of restrictions. The government of India had decided to restrict the number of flights to 2,000 a week due to COVID-19, which led to an increase in the ticket price.

Now, over 3,200 departures per week will be operated from India per week.

According to top executives from online travel agencies (OTA) ixigo and EaseMyTrip, fair corrections are expected as airlines are now slowly beginning to increase their capacity. “An increase in connectivity will regularise the demand-supply balance resulting in lower international airfares,” Aloke Bajpai, Group chief executive officer and cofounder of ixigo, told Business Insider.

Himank Tripathi, president of external affairs and investor relations at EaseMyTrip, further explained that there has been quite positive sentiment around international travel this year and the government’s decision of reinstating all flights would help manage the supply as well. “We have seen a ‘V’ shape recovery so far but the international market is yet to tame that,” he added.

Advertisement

He also noted that major airlines carriers are planning to add more airlines and number of seats to keep up with the demand.

According to media reports, European airlines like Air France, KLM, Finnair, Lufthansa, LOT Polish and Virgin Atlantic, along with Dubai-based Emirates and Malaysia-based Malaysia Airlines, are planning to add new routes, new flights and reinstate their previous operations in India. Singapore flights executives have also shared their plans to increase their flights by 17%, and IndiGo is hoping to resume its services with 1000 global flights in the months to come.

“Considering these two things going up [number of flights and the supply of airlines], usually what we have seen is that the airfare comes down. Another part here is that the carriers and the hotel industry have actually gone ahead and introduced interest perks for the customers, including all sorts of discounts, sort of offers…” Tripathi added.

He also noted that the Russia-Ukraine conflict is creating some “negativity” in the market and the number of people traveling to Europe is on a decline. Airlines are also forced to adopt different routes to reach their destination and the rise in fuel price is not helping others. So the experts believe that even if the price of the airfares decrease in the near future, there would be a little slow down due to the conflict.

“Hopefully, once the Russia-Ukraine tension eases and oil prices come down, we can expect a further correction in international airfares,” ixigo’s Bajpai added. Fuel prices have spiked five times in the last week alone, and it is currently at an all-time high.

Advertisement
Meanwhile, Neha Khanna, director at management consultancy firm ValPro, believes that the airfare prices will continue to increase since there is a high demand for international travel. “The airfares in India will continue to soar given the pent up demand after reopening of all flights as well as the high crude oil prices. The dynamic pricing system of airlines allows them to charge higher prices when demand builds up. Assuming travel remains open, this summer will witness heightened demand,” she told Business Insider.

SEE ALSO

PVR, INOX Leisure, GAIL, Emami among hot stocks to watch out for on March 28
You might soon be able to send up to 2GB of files on WhatsApp
Cypher Capital launches $100 million blockchain fund, with an aim to invest 40% of it in crypto startups in India
{{}}