Air Kerala, Alhind Air Plans Hit Turbulence Amid Global Tensions, Leasing Hurdles

Thiruvananthapuram: The launch of Kerala's much-anticipated private carriers - Air Kerala and Alhind Air - has run into turbulence, with geopolitical instability and financial constraints delaying their take-off plans.

Both airlines, originally expected to begin operations in 2025, are now facing uncertainty due to a mix of global and domestic challenges.

Kochi-based Air Kerala, envisioned as the Kerala's first private airline focused on affordable travel for expatriates, is grappling with investor and aircraft leasing issues. Despite securing a No Objection Certificate (NOC) from the Directorate General of Civil Aviation (DGCA) in 2024 and receiving the ‘KD’ airline code from the International Air Transport Association (IATA) in May 2025, the airline has struggled to finalise aircraft acquisition. The 'KD' airline code represents 'Kerala Dream', to the upcoming ultra-low-cost carriers targeting flights for non-resident Keralites (NRKs).

''We are currently seeking new investors,'' one of the representatives of the Air Kerala company, speaking on condition of anonymity, told ETV Bharat on Monday.

Industry sources indicate that global leasing firms have tightened norms following the collapse of Indian carriers such as Go First, now demanding up to 12 months' advance lease payments or proof of ₹200 crore liquidity.

Air Kerala's initial plan to deploy five ATR 72 aircraft for regional routes has been delayed after a deal with an Irish leasing firm fell through. The airline, however, maintains that operations are not shelved and long-term plans include scaling up to 20 aircraft, including Airbus A320s for international routes.

Meanwhile, Kozhikode-based Alhind Air, backed by the Alhind Group, is facing setbacks linked to global geopolitical tensions, particularly the Israel-US war on Iran. The conflict has disrupted airspace availability and delayed crucial aircraft leasing agreements just as the company was preparing to launch services. Alhind too had planned to begin with ATR 72 aircraft for domestic connectivity, eventually expanding to Gulf routes to tap into strong India–West Asia travel demand.

The group, which has a significant presence in travel services, has also reported a sharp dip in business, with nearly 10,000 bookings cancelled due to the ongoing tensions. Although it received DGCA clearance in August 2024 and aimed to connect around 40 Indian airports in its initial phase, the airline has now put expansion plans on hold.

''The war situation emerged just as the company was in the final stages of a deal to lease three aircraft. The unpredictability of the regional security climate and the resulting closure of airspaces have forced a strategic pause,'' Alhind Group of companies director corporate, Nooruddin A Ahmed told ETV Bharat on Monday.

Both airlines are strategically positioned to operate out of Kochi and were expected to boost regional connectivity while catering to Kerala's large expatriate population. However, the current delays underscore the vulnerability of aviation ventures to global uncertainties and financing challenges.

Industry observers say the revival of these projects will depend on stabilising global conditions and securing strong financial backing, even as Kerala continues to await its long-anticipated entry into the private airline sector.

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