India’s aviation sector may face deeper financial challenges as rating agency ICRA has sharply increased its loss estimate for FY27.
ICRA now expects Indian airlines to report combined net losses of around ₹36,000–38,000 crore, a major jump from its earlier forecast of ₹11,000–12,000 crore.
The revision comes due to several factors, including a weaker rupee, higher aviation turbine fuel (ATF) prices, rising aircraft lease costs, and slower passenger demand amid geopolitical tensions in the West Asian region.
The agency said increasing operational expenses may not be fully recovered through higher ticket prices, putting additional pressure on airline profitability.
ICRA has also revised its FY26 loss estimate upward to ₹32,000–34,000 crore, citing foreign exchange losses, slower traffic growth, and rising fuel costs.
The aviation industry continues to face challenges as airlines expand fleets while managing higher expenses and uncertain market conditions.