The over-eagerness resulted in other airlines adding capacity lost due to Jet’s grounding, forcing carriers to offer incentives to lure customers. The country’s sluggish economic growth has added to demand pressures, forcing airlines to offer lower fares, said the second airline official mentioned above. Taxes on aviation fuel in India continue to be one of the highest in the world. “Most Indian airlines are comfortable when oil price stays at about $60-65 a barrel, and rupee at 60-65 per dollar. When the rupee or oil prices breach this mark, airlines find it difficult to control costs," said the third airline official.

Source: Mint December 29, 2019 18:11 UTC