Adani denies Airline ambitions, but the question won’t go away 

For a company that keeps saying no, the Adani Group has spent an unusual amount of energy this week explaining why it isn’t launching an airline. 

It began on Thursday, when Reuters, citing the Economic Times, reported that the conglomerate had quietly approached the government seeking a change to a rule that has stood since 2006. Under that clause, drawn up when Delhi and Mumbai airports were first privatised, no operator of those two airports can hold more than a 10 per cent stake in a scheduled airline. That clause was inserted with good reasons, to avoid a conflict of interest. 

Adani runs eight airports across India, including both terminals in Mumbai, so the clause has effectively kept it out of the cockpit even as it built one of the country’s largest aviation infrastructure businesses. According to the report, the civil aviation ministry has asked Solicitor General Tushar Mehta whether the rule can be amended retrospectively, and any final change would still need cabinet sign-off. 

By Friday morning, Adani Enterprises wanted the story dead. In an exchange filing, a company spokesperson called the reports “entirely baseless and factually incorrect” and said the group was “not evaluating any proposal to enter the airline business.”  

It’s a familiar script. Jeet Adani, who runs Adani Airports, said much the same in December, arguing that thin margins and a business the group didn’t fully understand made airlines a poor fit for a company built on hard, long-gestation assets. 

Yet the timing is doing a lot of the talking. The government has reportedly been nudging large business houses toward aviation ever since Air India’s fatal Ahmedabad crash last year and IndiGo’s pilot-shortage disruptions in December exposed how thin India’s competitive bench really is. IndiGo and Air India together carry close to 90 per cent of the country’s domestic passengers. A third serious player, backed by deep pockets and existing airport infrastructure, is exactly the kind of thing policymakers have been quietly hoping someone would build. 

That’s precisely what worries IndiGo. On the airline’s earnings call this week, co-founder Rahul Bhatia didn’t wait to be asked twice. Allowing airport operators to also own airlines, he said, has no global precedent anywhere in the world, and would create a “massive conflict of interest.” His concern is structural: airport operators decide who gets which landing slots, which parking bays, and when. Handing that same operator an airline of its own, Bhatia argued, would eventually work against the people the rule is meant to protect: the passengers. Over time, he said, it would run against the interest of consumers. 

So where does that leave things? Officially, nowhere. No cabinet decision, no rule change, and now a formal denial from the party at the centre of it all. But the pieces on the table haven’t moved. The clause is still there. So is the government’s apparent appetite for a third big airline. So is Adani’s airport footprint, its Embraer manufacturing tie-up, and its history of saying no to something right up until it says yes. GMR, which runs Delhi airport, sits under the same rule and would benefit from any change too. 

Denials are easy to issue. Rules are harder to unwrite, and even harder to un-notice once everyone’s watching for them. Only time will tell if Adani’s ambitions will take to the skies, or if this flight of fancy has been cancelled before it even hit the runway.