After the IndiGo crisis, India grants NOCs to two airlines to boost competition

India’s civil aviation sector is entering a decisive phase of growth, driven by rising passenger demand, new airline entrants, and a government push to expand infrastructure and competition.

The recent granting of No Objection Certificates (NOCs) to Al Hind Air and FlyExpress , after the earlier clearance to Shankh Air , signals the Centre’s intent to encourage new airlines . An NOC is a preliminary approval from the Ministry of Civil Aviation that allows airlines to begin setting up operations, though commercial flying can start only after securing an Air Operator Certificate (AOC) from the DGCA .

Al Hind Air is promoted by the Kerala-based Alhind Group and is expected to focus on regional routes using smaller aircraft. FlyExpress, backed by a Hyderabad-based courier and cargo services company, remains at an early planning stage. Shankh Air, based in Uttar Pradesh, plans to connect regional cities such as Lucknow, Varanasi, Agra and Gorakhpur with metro hubs.

The push for new entrants comes amid concerns over market concentration . IndiGo controls over 60% market share , while the Air India Group holds around 25% , together accounting for nearly 90% of passenger traffic . Recent flight disruptions at IndiGo highlighted how stress at a single airline can affect the wider aviation network.

India’s air travel demand has expanded sharply over the past five years. Passenger traffic stood at around 204 million in 2019 and recovered strongly after the pandemic to reach about 240–241 million in 2024. Domestic flying has led this recovery, with aircraft load factors exceeding 86% , indicating tight capacity.

Government projections suggest passenger journeys could rise by nearly 80% to around 400 million by 2028–29. Meeting this demand will require significant additions to fleet capacity, airlines, and airport infrastructure.

To support this growth, the government has introduced several policy reforms, including the Bharatiya Vayuyan Adhiniyam, 2024 , which replaced the Aircraft Act of 1934. Another key initiative is the UDAN scheme , which provides financial support to airlines operating on underserved and unserved routes.

Airport infrastructure has expanded in parallel. The number of operational airports has increased from 74 in 2014 to over 160 today. The government plans to develop 50 new airports over the next five years and expand the network to 350 airports by 2047 .

Major projects underway include Noida International Airport (Jewar) , Navi Mumbai International Airport , Bhogapuram near Visakhapatnam, and Dholera in Gujarat. In the Northeast, a new integrated terminal at Guwahati Airport has significantly boosted capacity, positioning the city as a regional aviation hub.

Together, new airlines, policy reforms, and infrastructure expansion indicate that India’s aviation sector is at a critical juncture as it works to keep pace with rapidly rising demand.