India’s domestic air passenger traffic in March 2026 increased by 1% year-on-year to 146.8 lakh, with a monthly surge of 4.4%, according to a report. The report by ICRA revealed that domestic air passenger traffic for the fiscal year 2026 stood at 1,677.4 lakh, showing a 1.4% annual growth.
In February 2026, international passenger traffic for Indian carriers was recorded at 28.5 lakh, marking a 0.3% year-on-year decline and a sequential fall of 16%. The report forecasts a growth rate of 6-8% in domestic air passenger traffic for FY2027, subject to downside risks from potential spikes in airfares.
International passenger traffic for Indian carriers during the April-February 2026 period stood at 331.5 lakh, reflecting a year-on-year growth of 7.7%. The airlines’ capacity deployment in March 2026 was 3% lower than the previous year but 10.6% higher month-on-month due to fewer days in February.
The report estimated that the domestic aviation industry operated at a Passenger Load Factor (PLF) of 89.5% in March 2026, compared to 86% in March 2025 and 89.3% in February 2026. Passenger Load Factor represents the percentage of available seating capacity filled by paying passengers.
Due to the impact of the West Asian conflict, average ATF prices rose by 9.2% sequentially and 18.2% year-on-year as of April 10. While crude oil prices surged sharply in March 2026 due to the conflict, the pass-through to ATF prices remained moderate.
The Ministry of Civil Aviation capped domestic ATF price increases at 25% month-on-month, with oil marketing companies raising prices by only 9.2% sequentially in April 2026, thereby mitigating the immediate cost impact on the aviation sector. The report also highlighted the continuous decline of the INR against the USD as a concern for the aviation industry.
To provide relief to domestic carriers, the ministry announced a 25% reduction in landing and parking charges for domestic airlines for three months starting April 2026, as per the report.
