In a further sign that the government is in favour of opening up the economy more, the Ministry of Civil Aviation (MoCA) intends to increase the scale of domestic flights to 50 per cent of capacity.

Domestic flights resumed on May 25 but airlines are allowed to operate 33 per cent. The Ministry has sought suggestions from airlines on whether this is feasible. However, industry sources said except market leader IndiGo and government-owned Air India, the rest gave weak demand as a deterrent. They cited passenger worries, complicated by restrictions on the part of states, among the factors making it difficult to scale up. 

“We feel around 20 days of operations have been handled smoothly and the diligent observance of protocols has proved air travel is safe. The scale of operations can be increased,” said a government official, adding that airlines and state governments had been asked to give suggestions. 

The official pointed out the data till now proved that air travel was the safest mode of transport due to its controlled access and traceability at departure, transit and arrival. Less than 1 per cent of the people who flew since May 25 were detected carrying the virus. Also, only when a substantial portion of the domestic routes are functional, overseas flights can resume as international routes depend on traffic feed from domestic ones. Market leader IndiGo has supported the move and said it is willing to increase flights up to 50 per cent. 

“IndiGo is a strong proponent of flying more. The airline has informed the government it wants to scale up to 50 per cent if permitted,” said an airline executive. But SpiceJet, GoAir, AirAsia India, and Vistara said demand was not strong enough to operate at 50 per cent on all routes. Demand, they said, was primarily unidirectional, meaning the aircraft were flying on one route with few passengers. 

The reason IndiGo is willing to scale up is the company’s healthy cash balance, unlike that of its peers. A cash balance of Rs 20,376 crore gives IndiGo the cushion to operate flights on one way with a lower load but make money on directions where it gets full capacity. “Flights need to be at least 80 per cent full for an airline to have a chance to break even. Currently we are nowhere near that as there is traffic primarily from metros to cities in east India, from where a lot of migrant workers come. By ramping up capacity on those routes, IndiGo may not be able to recover the full cost of the trip, but at least recoup the variable cost,” said the airline executive.