India slips to 2nd spot in domestic aviation market for note ban: IATA
New Delhi: India lost its fastest growing domestic aviation market tag to China in March as it registered the lowest growth in 18 months, primarily due to the noteban, global airlines' grouping IATA has indicated.
The domestic passenger traffic in India in March grew at 14.6 per cent while in China it was at 15.1 per cent. "This is the first possible sign of reduced cash supply and wider economic uncertainty weighing on demand," said International Air Transport Association (IATA).
Prime Minister Narendra Modi had on November 8 last year announced scrapping of 500 and 1,000 rupee notes. India was at the top of the global charts for the domestic air passenger growth for 23 straight months until
February.
"China overtook India as the fastest growing domestic market at 15.1 per cent, posting the fastest year-on-year domestic growth rate for the first time in two years," according to IATA.
The Association attributed the passenger growth in China to its robust services sector growth as well as supply developments. As for India, it said that after posting over 20 per cent growth in domestic passenger market for 13 consecutive months until January this year, the demand for domestic air travel dropped to 17 per cent in February and 14.6 per cent in March.
However, India's domestic travel demand growth was still twice that of the global average which stood at 7.6 per cent in March. India is the third largest aviation market in terms of domestic passenger traffic, according to an industry report.
India's domestic air passenger traffic stood at 100 million in 2016, and was behind only the US (719 million) and China (436 million), Sydney-based aviation think-tank Capa Centre of Aviation said in a report.
