The trend of offering discounts was started by SpiceJet and AirAsia, but later IndiGo, Jet Airways and Air India also joined.
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“We also calculate the cross-elasticity of civil aviation traffic to changes in railways prices to be 5.7 per cent, which indicates that upper class passengers do not easily switch to airlines as a response to hikes in railway prices,” the Survey says.
It adds, “Freight traffic is more price-sensitive than passenger traffic. Within passenger traffic categories, upper class passengers are less price sensitive and may be better placed to internalise prices hikes vis-à-vis other passenger classes.”
The Survey further highlights a “healthy increase” in international passengers and cargo handling at Indian airports. “During April - December 2014-15, 101.34 million domestic passengers and 36.74 million international passengers were handled at Indian airports. Domestic passenger traffic throughput increased by 7.1 per cent and international passengers increased by 10.3 per cent during April-December 2014-15,” it said.
Meanwhile, international cargo throughput at Indian airports was up 8.3 per cent to 1.17 million tonnes, while domestic cargo throughput increased 19.3 per cent to 0.74 million tonnes.