India’s largest airline, Indigo Airways, posted net loss of Rs.2849 crore for the Jun-20 quarter, which was largely along expected lines. The pandemic lockdown had brought airline services to a virtual standstill across large swathes of India and despite resumption the demand has been weak and social distancing norms still stringent.

It may be recollected that Indigo had reported a profit of Rs.1200 crore in the Jun-19 quarter. For the Jun-20 quarter, the revenues from operations plunged by 92% to Rs.767 crore as only limited routes were available. Even the EBITDA was negative at Rs.1421 crore as the revenues were just not sufficient to cover even the committed costs.

Most airlines have a large chunk of fixed commitments like license fees, salaries and lease rentals, which are only partially negotiable. Globally, governments have sunk billions of dollars to save the airline industry, but in India there has been no plan of action on this front. Indigo has already laid off 10% of its staff and there could be more pain.