India beats China in November air traffic growth

India’s domestic air traffic grew 22.3% during November, while China’s rose 14.9% and Russia’s 15.5% compared with the same time last year


Airline executives fear that demonetisation would impact discretionary travel in the results after November. Photo: Ramesh Pathania/Mint
Airline executives fear that demonetisation would impact discretionary travel in the results after November. Photo: Ramesh Pathania/Mint

New Delhi: India maintained its position as the world leader in domestic air traffic growth in November while China and Russia also recorded double digit growth, the International Air Transport Association (IATA) said in a report on Wednesday.

IATA, which represents the majority of international airlines, said India’s domestic air traffic grew 22.3% during November, while China’s rose 14.9% and Russia’s 15.5% compared with the same time last year.

“Domestic travel demand rose 7.1% in November 2016 compared to the same month in 2015, but results continued to vary widely, with China, India and Russia showing double-digit growth while demand declined in Brazil and Japan,” it said.

November was the month when India announced steps to demonetise most of its currency notes. Although the banned currency notes could be used to buy air tickets until early December, airline executives fear that demonetisation would impact discretionary travel in the results after November.

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US makes up for 15.3% of the total share of domestic passengers globally, followed by China at 8.3%, Russia and Brazil’s 1.4% each, Japan’s 1.2%, India’s 1.1% and Australia’s 1%.

November 2016 also showed the strongest demand growth in nine months globally.

“Stronger demand for air travel reflects—and is supporting--a pick-up in the global economic cycle. As the stimulus effect of lower oil prices recedes in the rear view mirror, the strength of the economic cycle will play a key role in the pace of demand growth in 2017,” Alexandre de Juniac, IATA’s director general and chief executive said in a statement.

Juniac said the airline industry continues to deliver strong results.

“In 2017, for a third consecutive year, the industry’s return on invested capital will exceed the cost of capital. Passengers benefit from the industry’s success. Travel has never been more accessible—with great fares, many options and more destinations. Nevertheless uncertainty lies ahead. The threat of terrorism, questions over the durability of the economic upswing, rising oil prices and increasing protectionist rhetoric are among the concerns. The industry has reshaped itself and strengthened its resilience to shocks. We should see another solid year of collective profitability for the airlines in 2017. But we must be vigilant,” he added.

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