The net loss for India's domestic airline industry is expected to be in the range of Rs 150-170 billion this financial year, according to a report by credit ratings agency ICRA. This projected loss is a result of the elevated price of aviation turbine fuel (ATF) and a weak rupee. In India, ATF accounts for around 45 per cent of the operational cost of an airline. Besides, 35-50 per cent of an airlines' operating expenses are US dollar-driven, therefore a weak rupee makes a significant impact. Last fiscal's losses for the industry had come in at around Rs 230 billion. Debts for the industry as on 31 March 2023 are being seen at around Rs 1 trillion. These include lease liabilities. In the June quarter, IndiGo and SpiceJet booked losses of Rs 10.64 billion and Rs 7.89 billion respectively, primarily because of a weak rupee and costlier ATF. ICRA said domestic passenger traffic saw a healthy 57.7 per cent year-on-year growth at 84.2 million in FY22. In Q1 FY23, domestic passenger traffic was higher by 2.04 times at 32.5 million YoY. It fell short of the pre-Covid level (Q1 FY20) by about 7 per cent. With the return to normalcy, domestic passenger traffic is expected to grow 52-54 per cent YoY in FY23. Domestic traffic is expected to touch pre-Covid levels by FY24. While the civil aviation ministry has discontinued fare restrictions with effect from August 31, a sharp hike in air fares will be deterred by the intense competition and airlines' endeavours to maintain and/or expand their market shares, the agency said. See also: Jyotiraditya Scindia aims to make India an international aviation hubGoa in line to get a new airport