Akasa Air Challenges Duopoly Amid Iran War Disruptions

India's youngest airline, Akasa Air, is emerging as a significant competitor, expanding capacity by 13.2% while major carriers like IndiGo and Air India reduced flights. This growth occurs amid disruptions from the Iran war, which has increased fuel costs and impacted international routes for established airlines.

Akasa Air, India’s youngest airline, was the only carrier that added meaningful capacity in the local market in recent months, emerging as a growing threat to the IndiGo-Air India duopoly amid disruptions caused by the Iran war.

The total number of flights operated by the country’s four major airline companies dropped nearly 6% across March and April from the same period a year earlier, according to data from Cirium, an aviation analytics firm. IndiGo, the country’s largest airline, had 4.5% fewer flights, while Air India Ltd.’s full-service airline reduced services by 7.5% and its low-cost unit Air India Express did so by 17.1%.

In contrast, Akasa expanded capacity by 13.2% over the same period, albeit from a much smaller base than its larger rivals. The low-cost carrier, which was founded during the coronavirus pandemic and made its first commercial flight in 2022, operated 10,109 flights in March and April 2026. That was about 4.7% of the total number of domestic and international flights by Indian airlines during the period, the Cirium data showed. It didn’t provide a breakdown between the two.

India’s commercial passenger aviation market has been dominated by two companies in the past few years, with IndiGo and Air India Group controlling nearly 90% of domestic capacity. Akasa, which has much fewer planes than the incumbents, intends to dramatically increase its fleet size in the coming years to rival the biggest carriers.

The latest Middle East conflict, which escalated after the US and Israel launched air strikes on Iran on Feb. 28, has hit India’s airlines with higher fuel costs and disruptions to some international routes. Carriers have had to cancel flights and divert some international routes around Iranian airspace, adding to challenges they already faced because they couldn’t use Pakistani airspace. Domestic demand has also softened as carriers have passed on higher fuel and operating costs through increased fares.

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SpiceJet Ltd., once a major competitor in the budget segment, increased flights by just 1% in March and April this year from a year ago, the Cirium data showed. The carrier has been facing financial strains and is losing money. The airlines all didn’t respond to requests for comment on the data.

Akasa operates domestic routes and currently flies to seven international destinations. Within India, it carried 5.4% of passengers in March, according to government data that tracks domestic airline traffic, compared with IndiGo’s 63.3% and the Air India Group’s combined 26.2%. The official figures for April have yet to be released.

Akasa currently operates 38 Boeing Co. 737 MAX aircraft, versus more than 420 planes at IndiGo and roughly 300 across the Air India Group. It said in March that it has placed “a firm order” for 226 more planes, which would be delivered in the coming years. So far, the carrier’s smaller scale has allowed for faster redeployment of aircraft, while larger carriers operate tightly scheduled networks with limited room to add flights on short notice.

The Mumbai-based airline is owned by SNV Aviation Pvt., whose shareholders include Akasa’s founder and CEO Vinay Dube, the family of the late billionaire Rakesh Jhunjhunwala, a private equity fund overseen by 360 ONE Asset Management, and other investors.