Domestic air fare will increase due to a 2% cut in April 2026, mainly due to capacity constraints of IndiGo after the December 2025 merger, said Cirium, an aviation analytics firm.

As part of its Aviation Market Outlook 2026, released on February 4, Cirium said India’s domestic capacity is down 2% in April 2026 from April 2025. The decline is attributed to the 10% IndiGo capacity cut imposed by the Directorate General of Civil Aviation (DGCA).

Richard Evans, senior consultant at Cirium Ascend Consultancy, said the company’s October 2025 forecast projected India’s aviation market to grow by 10% annually over the next decade.

“However, India is on the downside (growth) for April 2026 due to Indigo’s schedule drop. There is a capacity cut and we don’t know how long it will continue. The domestic schedule is not growing and airfares will go up in the market,” Evans said.

The Ministry of Civil Aviation has capped the airfare after the IndiGo episode, but it is likely to make a call with the summer schedule from April. Air fares in India are market driven and not regulated by the government.

IndiGo saw the cancellation of more than 5689 flights in early December after the new Flight Service Time Limitation (FDTL) norms kicked in from November 2025. With thousands of passengers stranded due to IndiGo’s cancellations, the DGCA gave the airline a one-time FDTL relaxation till February 10.

IndiGo is also under the Competition Commission of India’s (CCI) scanner for abuse of market dominance, with a 65% market share. The low-cost carrier’s net profit fell 77.6% to Rs 549.8 crore, compared to Rs 2,448.8 crore in the third quarter of the previous year, compared to the same period last year.

The airline’s finances were hit hard by exceptional items that added up to Rs 1,546.5 crore during the quarter. This included a significant provision of Rs 969.3 crore for the implementation of new labor laws.

In addition, the company absorbed costs of Rs 555 crore related to operational disruptions and a penalty of Rs 22.2 crore imposed by the DGCA. The airline faced major service disruptions in early December, leading to flight cancellations and delays.