Indian Aviation Faces Rs 18,000 Crore Loss in FY26, ICRA Warns

• Indian aviation sector projected to incur a net loss of Rs 17,000-18,000 crore in FY26, revised upwards from Rs 9,500-10,500 crore.
• ICRA attributes the increased loss forecast to softer passenger traffic and operational disruptions like the Air India Boeing 787-8 crash and IndiGo flight cancellations.
• Domestic air passenger traffic growth forecast for FY26 revised down to 0-3% from 4-6%; international growth to 7-9% from 13-15%.
• Factors include cross-border escalations, US tariffs affecting business travel, and rupee depreciation against the US dollar.
• Despite recent traffic increases (Nov 2025 domestic at 1.54 crore), overall travel sentiment remains dampened.

Why It Matters: Indian aviation faces a significantly higher FY26 loss due to traffic slowdowns and operational issues.