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The 2026 Indian Union Budget is expected to reiterate the importance of improving regional connectivity through the Regional Connectivity Scheme (UDAN). The aviation sector is less focused on new declarations and more on delivery. According to an ICRA report, domestic air passenger traffic for the seven months of FY26 was 944.5 lakh, while infrastructure constraints at major airports turned out to be more visible.
As 2025 has flown by, it is important to look back at what has happened in the world of aviation in India. This industry has been ruling the roost even when the world was still reeling under COVID-19. The IATA predicted that the world would recover to pre-COVID-19 levels by 2024. Indian domestic aviation rather exceeded pre-pandemic levels in 2023, indicating that the industry has only gone from strength to strength. Though India has one of the fastest-growing aviation industries, it faced turbulence in 2025 due to massive flight disruptions, monetary fluctuations, safety crises and structural holdups. IndiGo’s ascendency in the Indian aviation industry eroded under regulatory pressures, while Air India’s merger struggles and a fatal crash worsened its vulnerability. As a result, passengers were stranded, passenger trust declined greatly and government interventions were necessary to control the soaring operational costs.
