Why are India Flights so Expensive?

Why are India flights so expensive? I get asked this question a lot as an Indian living in Canada. We all remember the days where we could fly round trip, from Canada to India, for less than $1,000. Today, if we see a deal for $2,000, we consider it a fantastic offer. Pre-pandemic, a $2,000 round trip economy class fare would be considered obscenely expensive.

What happened?

Chinese airlines have not returned to North America

This is a simple economic theory being applied in real life. Extra supply brings down prices. Low supply increases prices. Prior to the pandemic, China and USA allowed over 300 weekly flights between the two countries across all airlines. Today, it is limited to 100. That is 33% of the pre-pandemic capacity.

Last year, flight capacity between Canada and China was 10% of pre-pandemic capacity. That is a huge drop in supply. Canada China capacity was even more important since it allowed Indians to by-pass USA entirely, avoiding the hassle of obtaining of obtaining an USA visa and going through USA customs.

Ultimately, with a drastic reduction in capacity, air fares would have only had an upward positive effect.

Russia Ukraine War

The war has probably impacted flight scheduling more than we realize. West-coast flights to India, non-stop, can only be operated by Air India. All Canadian and US carriers cannot overfly Russia, limiting their ability to do non-stop flights. United has cancelled their San Francisco to Delhi and Newark to Mumbai flights due to the economics of not flying over Russia making the flight unsustainable. Air Canada did something similar, cancelling their Vancouver to Delhi flight, due to the Russia Ukraine war.

Increased Demand

Let’s not deny, demand for India Canada flights is also over the roof because of increased immigration. Between 2013 and 2023, there was a 326% increase in immigrants from India to Canada. I know it’s a contentious topic within the community, so I won’t dabble in that debate. Ultimately, I have been a beneficiary of the open immigration system as well, and I cannot forget that.

Capacity is increasing to India

Air Canada is increasing capacity drastically, adding a daily Montreal to Delhi flight, up from 3 or 4 times per week. In addition to that, adding a Toronto Mumbai flight and changing the London flight to Delhi. That will allow those on the West Coast to have another one-stop option from Canada to India.

Air India is also increasing capacity across North America, with flights to Seattle and Los Angeles in consideration. They also announced increased capacity to Toronto as well.

Lufthansa is flying 380 from Munich (connectivity from Germany to India). That also provides increased connectivity with United, Air Canada and Lufthansa from North America to India.

Virgin Atlantic is also returning to Toronto. While the flight timing is not ideal for India connections, on both sides of the journey, I am sure, Indians will appreciate one more travel option between Canada to India.

Conclusion

Ultimately, why are India flights so expensive? It’s a simple theory of supply and demand. The supply of seats between Canada and India has decreased dramatically, with the suspension of flights over Russia and the drastic reduction in capacity to China. Demand has exploded, with a surge of immigrants. Even though some airlines are trying to increase capacity in narrow pockets, that pales in comparison to what it was pre-pandemic.

Until capacity rises drastically, expect prices to be inflated, and much more than what we have come to expect pre-pandemic.