Increasing in Omicron circumstances is not going to solely affect growth by up to 0.03 % due to restrictions set by numerous states however it is likely to impact the lodge and aviation business likely the most as several hoteliers are witnessing cancellations for January 2022, whereas daily passenger traffic on airways has additionally dipped within the final week.

Knowledge from earlier waves means that restrictions are set on mobility as COVID circumstances rise, which in flip impacts economic activity.
- “With states imposing COVID-related restrictions (night curfew on the activity of people, restaurants permitted at 50 percent capacity, offices to operate at 50 percent capacity in various states), financial activity is likely to get affected in Q4FY22,” mentioned economists at HDFC Bank.
The liability dangers on the present juncture emanate from different states imposing restrictions, the restrictions extending past January 2022, and additionally a slowdown in international restoration which can weigh on the exports, they said in a observe.
Third quarter of FY 21-22
According to score company ICRA until December 2021, there was the sturdy need for a journey and there was just some cutdown in discretionary enterprise travel. Leisure journey, till December, it mentioned, largely remained unchanged. The third quarter of FY 21-22 was considerably higher than the company’s earlier projections.

“With the emergence of the Omicron variant and sharp rise in infections, several states have set partial lockdowns. This will curtail travel over the next few weeks.
We are witnessing cancellations and hotel inquiries have dropped. A month of full lockdown will affect FY2022 Pan-India occupancy by ~4 percentage points” told Vinutaa S, Assistant Vice President, and Sector Head, ICRA.
Booking cancellations for Christmas and New Year celebrations, along with those of weddings and planned events, due to a surge in COVID-19 cases have so far resulted in a loss of around Rs 200 crore in the hospitality industry, according to the Federation of Hotel & Restaurant Associations of India (FHRAI).
Pre-Covid levels in the last few months
“From twenty-fifth (December) onwards, there was a drastic plummeting of the charges and occupancies in metropolis hotels that are again to the pandemic ranges of 10 percent to 15 percent occupancy and charges have also hit,” told FHRAI Joint Honorary Secretary Pradeep Shetty.
The third quarter of FY2022 was significantly more promising than ICRA’s earlier expectation. Leisure destinations like Goa and Jaipur witnessed healthy occupancy, with Goa’s occupancy being higher than pre-Covid levels in the last few months.
Mumbai and Delhi also witnessed over 60%
Mumbai and Delhi also witnessed over 60% occupancy since August 2021, while Pune and Bangalore remained laggard.

But with the Omicron variant, ICRA hopes for some slowdown in Q4 FY2022, compared to what was expected earlier.
But ICRA told it is not revising its earlier expectations for FY 21-22 since the strong third-quarter demand and the low bias for Q4 if there will be prolonged lockdowns, will suspend out.
“ICRA’s pattern reported a QoQ income enhancement of 117% in Q2 FY2022 and is expected to enhance by one other 15% sequentially in Q3 FY2022, given the wholesome festive season journey witnessed.
The operating margins are also anticipated to witness sequential enhancement in Q3 FY2022, with higher working leverage. However, the monetary efficiency in This fall FY2022 is linked to the depth of the present Covid wave and the lockdowns,” told Vinutaa S. The return to pre-Covid levels is still a few quarters away.
Also, read
- IndiGo limited operations; Hong Kong suspends flights from India: Know more
- Does the third wave affect Indian Aviation? How will it increase ATF costs?
- Does the third wave affect Indian Aviation? How will it increase ATF costs?
Airlines too are facing uncertainty with several countries and states resorting to flight and border restrictions to control the spread of the Omicron variant.
Domestic air passenger traffic
On Jan 4, daily domestic air passenger traffic fell below 3 lakh levels for the first time since November 21 and on Jan 5 it dropped further to 2.58 lakh The average number of daily passengers from Dec 1 to 20 was over 3.60 lakh.

- “The home business is at the moment operating at 93% of the pre-Covid capability of 3,000 departures/day. We notice the excessive threat of disruption in traffic due to an upcoming third wave of Covid,” told Ashish Shah, research analyst at Centrum Broking.
|ndiGo has suspended most of its flights between
Already, low-cost carrier IndiGo has suspended most of its flights between Delhi, Mumbai, and three major airports of West Bengal namely; Kolkata, Durgapur, and Bagdogra for three months.
The statement has come after the West Bengal government restricted flights to Kolkata from Delhi and Mumbai and told that the flights to Kolkata will be allowed to work only thrice a week– on Monday, Wednesday, and Friday with effect from January 5.
Hong Kong has banned flights from eight nations
Hong Kong has banned flights from eight nations, including India after the Omicron variant was detected within the city.
“With scheduled worldwide operations, but to start and home passenger restoration however a piece-in-progress the Indian aviation business is estimated to report a web loss of Rs 250-260 billion in FY2022, with restoration in home passenger traffic to pre-Covid ranges expected just by FY2024,” told Superior Banerjee, Vice President & Sector Head, ICRA.

India rating estimates that the Omicron variant of Coronavirus will hit the GDP for March quarter of 2021-22 by 0.40 percent and slice off 0.10 percent from the overall development of the current fiscal, due to curbs in various forms such as reducing the capacity of market and market complexes and night and weekend curfews to check human mobility/contact.
Complete 2021-22, the GDP is
The surge in cases seen over the last fortnight will hurt the fourth-quarter GDP and the increase will come at 5.7 percent during the quarter, which is 0.40 percent lower than the earlier estimate of 6.1 percent. For the complete 2021-22, the GDP is anticipated to clock a growth rate of 9.3 percent, 0.10 percent lower than what was estimated earlier, it said further.
However, trade association and advocacy group ASSOCHAM revealed that India Inc, across other sectors, is far better ready to remain functional.
“Less severity of Omicron, seen as of today, has helped the governments and the industry to remain confident about India’s ability to come out of the current phase of the pandemic with a minimum of effect on the economy,” ASSOCHAM secretary common Deepak Sood said in a press release.

On Thursday, India added greater than 116,000 new circumstances of Covid-19, the best single-day enhance since June 5, 2021.
Daily circumstances have now grown greater than 10-fold in simply 10 days, a pace unseen within the two years of the pandemic within the nation.
Maharashtra, West Bengal, and Delhi are reporting the highest quantity of circumstances within the nation.
Thank you
Stay updated with Aviationa2z.com