11 Airlines Exit India's Aviation Market Amid Financial Stress, Mergers Reshape Aviation

Mumbai: Eleven airlines have exited India’s aviation market over the past decade, the government informed Parliament on Monday, citing financial stress, aircraft shortages and internal operational issues as the primary reasons.

Minister of State for Civil Aviation Murlidhar Mohol, in a written reply in the Rajya Sabha, said the sector operates in a deregulated environment where airlines function on commercial considerations, with the government focusing on maintaining overall balance and stability. “Since 2016, a total of 11 airlines have exited the market due to reasons such as financial stress, non-availability of aircraft and other internal issues,” Mohol said.

The statement also highlighted ongoing consolidation within the sector. AirAsia India, now renamed AIX Connect, has been merged with Air India Express, while Tata SIA Airlines Ltd. (Vistara) has been absorbed into Air India. While the government did not provide a list of the airlines that ceased operations, the data underscores the structural challenges facing India’s aviation industry, including high operating costs, volatile fuel prices and intense competition.

On outstanding dues, Mohol said Kingfisher Airlines owed `380.51 crore to the Airports Authority of India (AAI), with the claim currently before the official liquidator in Bengaluru. Kingfisher had suspended operations in 2012. He added that TruJet has minimal dues of `0.03 crore to AAI, while no dues are pending from Jet Airways and Go First. The reply reflects both the churn and consolidation underway in India’s aviation sector, where financial viability continues to be a key challenge despite strong passenger demand.