India's aviation has strong growth potential, holds only 4% of global traffic with 18% of the world's population: Jefferies
- IBEF
- July 18, 2025
India’s aviation sector is poised for substantial expansion, driven by improving air connectivity, rising disposable incomes, and increasing investment in infrastructure. Despite being the third-largest aviation market globally in terms of passenger volume, India contributes only around 4% to global air traffic, underscoring the sector’s under penetration relative to its population share of nearly 18%. A recent report by Jefferies noted that domestic air travel per capita remains low, highlighting vast growth potential. Current efforts, such as the addition of new routes and expansion into international markets, aim to remedy this gap. Compared to China’s annual passenger volume of 0.7 billion and fleet size of 4,000 aircraft across 250 airports, India manages only 0.2 billion passengers. It operates approximately 850 aircraft through 150–160 airports. This contrast further illustrates India’s potential to scale. Unlike China, India lacks a robust high-speed rail system, relying instead on conventional rail, which reinforces the importance of strengthening the aviation sector.
Nonetheless, the path forward is not without challenges. The industry grapples with limited aircraft availability due to global supply chain constraints, which may delay new aircraft deliveries. High taxation on Aviation Turbine Fuel (ATF) inflates operational costs, while restricted airspace resulting from geopolitical factors.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.
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