The operational crisis currently faced by IndiGo is causing significant economic repercussions in Delhi, extending beyond the confines of airport terminals. The Chamber of Trade and Industry (CTI) has assessed that the extensive flight cancellations by the airline have resulted in an estimated business loss of nearly Rs 1,000 crore for various sectors in Delhi, including trade, industry, tourism, and exhibitions.
Brijesh Goyal, the Chairman of CTI, highlighted that the frequent disruptions in daily flights have had a severe impact on the movement of traders, tourists, and business travelers, leading to a noticeable decline in market activities throughout the city. Foot traffic in Delhi’s markets has decreased by approximately 25% over the past 10 days, with out-of-town visitors avoiding travel uncertainties related to air transport.
On a daily basis, more than 1.5 lakh passengers typically depart from Delhi airport, with around 50,000 being traders and businesspersons. However, due to the repeated cancellations by IndiGo, this flow has significantly reduced, resulting in direct losses for wholesale markets, retail centers, and commercial areas.
Furthermore, hospitality establishments such as hotels, restaurants, banquets, and resorts have experienced numerous cancellations in the recent week alone. The impact has been notably harsh on the exhibition and events sector in Delhi, with large-scale events like automobile expos, textile exhibitions, and others witnessing reduced participation due to last-minute flight disruptions.
The ongoing crisis is now affecting the peak tourism season, with a notable impact on Christmas and New Year bookings. The situation has also affected destination weddings, leading to losses for various service providers in the hospitality and events industry.
Following the directive from the Directorate General of Civil Aviation (DGCA) to curtail 10% of its operations, IndiGo’s crisis deepened. The Ministry of Civil Aviation has initiated steps to redistribute this reduced capacity among other domestic airlines to restore passenger confidence and prevent further cancellations.
This redistribution plan aims to convey a message to the aviation industry that operational failures can directly influence market share. The redistribution process will involve reallocating the curtailed operational share of IndiGo among airlines like Air India, Akasa, and SpiceJet based on their fleet strength and operational capabilities.
The government plans to implement the reallocation gradually to ensure stability and prevent additional flight cancellations. While the government aims to complete the redistribution promptly, caution will be exercised to avoid capacity constraints leading to further disruptions.
Despite the redistribution, IndiGo will continue its operations across all sectors and destinations, but routes with high demand and frequency may experience the most substantial impact. Traders’ associations warn that if stability is not swiftly reinstated, the mounting losses for Delhi’s markets, hotels, event venues, and tourism operators could escalate further during this critical festive and tourism season.