India's domestic aviation sector worst performer globally

India's civil aviation sector was the worst performer globally in July as the domestic passenger traffic contracted 1.1 percent year-on-year, the International Air Transport Association (IATA) said Thursday.

"After expanding at 20 percent plus rates through 2010 and early 2011, the Indian market stopped growing at the end of 2011," IATA said, adding that the contraction was due to a combination of many factors, including a slowdown in the economy.

"The uncertain economic outlook is having a negative impact on demand for air transport," Tony Tyler, director general and chief executive of IATA, said in a statement.

The demand-supply gap too widened in the month under review as 2.1 percent more capacity was added which reduced the average load factors of the domestic carriers to 69.6 percent from 71.8 percent in the corresponding period of last year.

According to the country's aviation regulator, the domestic air passenger traffic fell 9.93 percent for the third straight month in July, which stood at 45.37 lakh from 50.37 lakh travellers in the corresponding month of last year.

The passenger traffic on the month-on-month basis fell 11.17 percent in July at 45.37 lakh from 51.08 lakh travellers in June 2012.

However, international passenger demand in July increased by 3.5 percent compared to the year-ago period. International load factors remained healthy at 83.3 percent.