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Resumption of flight services: Kerala’s travel, hospitality sector in wait and watch mode

Rising oil prices, falling rupee, Ukraine war likely to cause turbulence

March 09, 2022 07:13 pm | Updated 07:20 pm IST - THIRUVANANTHAPURAM

The Centre’s decision to resume all international flights from March 27 after a hiatus of around two years has brought a sense of hope to the crisis-hit aviation and hospitality sector in Kerala.

Though the industry is upbeat about the decision to re-start full-fledged services from the summer vacation, the euphoria over the anticipated steep slashes in air fares and immediate rebound in tourism may be misplaced as the decision comes against the backdrop of rising oil prices, falling rupee and the ongoing Russia-Ukraine war.

Speaking to The Hindu, a senior airline officer said the summer schedule will see all the airliners taking to the skies just as in the pre-pandemic era. This is expected to make air travel more competitive with the increase in flight frequencies. Normally, air passengers used to benefit from competition. However, this time, the airlines will not show any hesitancy to pass on the surge in aviation turbine fuel (ATF) prices, in tune with international oil prices surging to over a seven-year high, directly to passengers.

Further, Air India Express, which holds a monopoly of sorts in the West-Asian routes from Kerala, has been operating full-fledged services – from relief flights to operations under Vande Bharat Mission and services under the air bubble agreement – since the end of the first wave of the pandemic.

As per International Air Transport Association-Direct Data Service (IATA-DDS) stats, Air India Express’ market share has increased by about 5 per cent, and cargo operations went up from 7.1 per cent in the 2019-20 period to 15.30 per cent up to January in 2021-22.

So the competition in the West-Asian routes – to and from the State – would be relatively less. “In case of travels to Europe and the U.S., the passengers will have to shell out more as flight durations in some of these routes have become high due to the air space restrictions following the war,‘‘ said Biji Eapen, National President, IATA Agents Association of India.

Though the hospitality sector expects a rebound in foreign tourist arrivals in general, a shortfall in tourist arrivals from Europe is anticipated in the backdrop of the war. Hence the growth in air travel and foreign tourist arrivals would be slow and steady as per the current global scenario, said E. M. Najeeb, senior vice president, Indian Association of Tour Operators.

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