Air India will move a larger share of its Europe- and US-bound flight capacity from Delhi to Mumbai as the continued closure of Pakistani airspace increasingly disrupts its western international network. The airline will retain services to these destinations from the national Capital but plans to make Mumbai a bigger base for its long-haul operations.
Chief executive officer Tewolde Gebremariam announced the proposed network changes at the Aviation India and South Asia 2026 conference in New Delhi on Tuesday, saying the restructuring was part of the airline's efforts to recover its share of international passenger traffic.
“Most of our network, unfortunately, in Europe and America, has been affected by the airspace closure,” he said.
Gebremariam described the restrictions on Pakistani airspace as a particular disadvantage for Air India, as its competitors from other countries do not face the same limitation. While high fuel prices and geopolitical tensions in West Asia affect the wider aviation industry, the airspace restrictions have created an additional challenge for Indian carriers operating westbound routes.
“We have unique problem of the airspace closure here in the Pakistan airspace closure. That is affecting us and our competitors, they are not affected by the same problem,” he said, describing the disruptions as short-term headwinds the airline must navigate.
Mumbai to take a bigger role in western network
Under the proposed restructuring, Europe- and America-bound operations will increasingly be centred on Mumbai, while Delhi will remain an important base for flights towards eastern and south-eastern destinations.
“The eastern side and the southeastern side of our network are not affected by the airspace closure. So those growths will be by and large in Delhi. And Europe and America will be in Mumbai,” Gebremariam said.
The airline is also considering Bengaluru as a third international hub alongside Delhi and Mumbai. Gebremariam said India had the geographical advantage, a large and young population, a growing economy and a sizeable diaspora to develop into a major global aviation centre.
“India can establish itself as a global hub. The only one hub, multiple hubs,” he said, adding that cities such as Bengaluru and Hyderabad could also emerge as international gateways.
Regaining international market share is immediate priority
Gebremariam said Air India's immediate objective was to recover international passenger traffic travelling to and from India, which he described as business that rightfully belonged to the airline.
“Our immediate focus is to regain market share from the competition on India to the rest of the world,” he said.
Alongside this, the carrier wants to expand the volume of passengers connecting through India to other international destinations. Connecting traffic currently accounts for around 10% of Air India's business, and the airline intends to increase that share over time.
The strategy is part of a broader effort to strengthen India's position as an international aviation hub, allowing domestic passengers to connect to overseas destinations through Indian airports rather than relying on foreign hubs.
Air India sets up team to reduce operating costs
While outlining the expansion plans, Gebremariam acknowledged that profitability remained a major concern. He said the airline needed to reduce its cost per available seat kilometre, which he described as too high, and improve its overall financial performance.
Air India has established a multi-functional team to identify cost-saving opportunities and improve operational efficiency. One of the areas being examined is closer coordination between its full-service and low-cost operations, Air India and Air India Express, including the sharing of common corporate functions.
The airline is also looking at ways to make its operations more efficient as it works towards returning to profitability. Gebremariam has said he wants the carrier to achieve that goal soon, while stressing the need to address its high operating costs.
Airline looks to expand wide-body aircraft order
As part of its longer-term international expansion strategy, Air India is considering increasing its order for wide-body aircraft to strengthen its long-haul fleet.
The airline has held discussions with both Boeing and Airbus as it evaluates its requirements. The expansion is intended to improve international connectivity and provide more efficient aircraft for long-distance routes. Older wide-body aircraft are expensive to operate and less fuel-efficient, making fleet renewal an important part of the airline's turnaround plans.
Air India has been pursuing a multi-billion-dollar transformation since returning to Tata Group ownership in 2022, involving fleet expansion, cabin upgrades and network restructuring. The airline is seeking to improve its competitiveness in international markets while addressing mounting operating costs and persistent financial losses.
The proposed shift of western-bound capacity towards Mumbai, the possible development of Bengaluru as another hub and plans to expand the wide-body fleet form part of its effort to regain overseas market share despite the continuing disruption caused by Pakistan's airspace restrictions.