International growth now outstripping domestic growth at India’s airports

Image: Dragonair Terminal and Official Group Photo
Dragonair launched Bengaluru-Hong Kong services on 2 July. Growth in international traffic at India’s airports has averaged around 11% so far in 2008, which is higher than domestic traffic growth.

Latest figures from the Airports Authority of India reveal that the dramatic growth rates seen in recent times in the domestic market may have come to an end. For the latest two months for which data has been published (April and May) domestic passenger numbers have grown by less than 10%. As a result domestic growth for the first five months is now in single digits compared with almost 30% growth in 2007.

Chart: Indian domestic air traffic growth
Source: Airports Authority of India

According to reports in India the DGCA has revealed that domestic traffic actually fell by 4% in June and by a massive 12% in July, as a result of hikes in air fares introduced by many of the loss-making airlines.

This relative ‘slump’ in growth coincides ironically with the opening of two new (replacement) airports in India. Hyderabad’s new airport began operations on 23 March while Bangalore’s new airport finally started receiving commercial flights on 24 May.

Chart: Top 13 Indian Airports Domestic Traffic
Source: Airports Authority of India

Among India’s busiest airports only Jaipur (+25.5%) and Cochin (+22.4%) achieved domestic growth of over 20% in May. At four of India’s top 13 domestic airports (Bangalore, Chennai, Goa and Guwahati) domestic traffic fell by up to 5%. In January only two airports had seen domestic traffic numbers fall.

International markets now growing faster than domestic

International traffic growth which had been running at between 15% and 20% for most of 2007 is also showing signs of maturity with growth in 2008 averaging around 11%. However, this is now higher than domestic traffic growth. In May 2008, Delhi and Mumbai (which cater for around half of all international passengers) saw traffic increase by 7.0% and 9.5% respectively. At Chennai and Cochin international traffic was up 18.4% and 28.3% respectively.


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