The Adani Group has declared it will not venture into the airline business, even as the Indian government explores a policy change that could permit airport operators to own and run air carriers. Jeet Adani, Director at Adani Airport Holdings Ltd. (AAHL), affirmed the group's stance, emphasizing that the airline industry does not align with its capital discipline.
“We will not consider it as it stands today; the airline industry is not something that we see fitting the capital discipline,” Adani stated across various media platforms. He elaborated, “We are used to high-margin business and investing in assets and using our assets well. The airline business is the opposite. We have no plans to enter the airline business.”
Currently, the Adani Group operates eight airports in India, including major hubs like Navi Mumbai and Mumbai. The GMR Group, another significant player, manages five airports, including Delhi and Hyderabad. The proposed government policy aims to increase competition in India’s aviation market, which is currently dominated by IndiGo and Air India, collectively accounting for nearly 90% of domestic capacity.
Government Eyes Aviation Market Shake-Up
Sources familiar with the matter indicate that the Ministry of Civil Aviation is discussing a proposal to allow airport operators to launch their own airlines. This move would require legal approval from the law ministry and clearance from the Union Cabinet. Presently, operators of Delhi and Mumbai airports are restricted from holding more than a 10% stake in any airline.
However, concerns have been raised that such a policy could lead to airport operators favoring their own airlines, potentially through preferential airport slot allocation or other advantages.
Challenges in India's Airline Sector
The Indian aviation market has historically been challenging, marked by intense competition and thin profit margins. Over recent years, several major airlines, including Jet Airways, Kingfisher Airlines, and Go First, have ceased operations. Even dominant carriers like IndiGo and Air India reported losses in FY26, attributed to factors such as high aviation turbine fuel prices, a stronger US dollar against the rupee, and broader geopolitical instability.