In March 2026, Indian airlines reported a decline in domestic air traffic, carrying 1.43 crore passengers, which is 1.2% lower than March 2025. The reduction in traffic is attributed to the ongoing West Asia conflict, which has affected connecting flights and led to cancellations. Airlines deployed 3.25% fewer flights compared to the previous year, with Air India group experiencing a market share drop to 26.3%. IndiGo also lost market share, while Akasa Air grew to 5.4%. Economic pressures, including rising oil prices and the traditional exam season, contributed to the decline. However, as airlines adjust capacities from international to domestic flights, there is potential for a slight recovery in air traffic in the coming months. The Indian government has intervened by capping aviation turbine fuel (ATF) prices for domestic airlines, which may help mitigate some financial pressures on carriers. Despite current challenges, the aviation sector has shown resilience, with higher traffic in the January to March quarter compared to the same period last year.