Aircraft, Funding Hurdles Alleged Reasons For Al Hind Air’s Take-Off Delay

Al Hind Air’s long-awaited entry into India’s aviation market is facing fresh turbulence. The airline, which received its no-objection certificate (NOC) from the Ministry of Civil Aviation in December 2025, is struggling to move to the next regulatory stage due to delays in aircraft acquisition and financing, according to a report by The Financial Express.

Sources cited in the report said Al Hind Air has been scouting for aircraft for several months, with an initial plan to start operations with three ATR 72 turboprop aircraft and eventually scale up its fleet to seven.

The airline has been exploring the purchase of pre-owned ATRs that are four to five years old, a strategy aimed at lowering acquisition costs compared to new aircraft deliveries.

While some within the airline have pointed to aircraft availability as a bottleneck, industry executives told The Financial Express that supply is not the binding issue.

Pre-owned ATR aircraft are currently available in the global market, and other Indian regional carriers are in the process of inducting similar planes. Instead, the more pressing challenge appears to be funding, they said.

Leasing aircraft is typically the preferred route for new airlines, as it requires lower upfront capital. However, Al Hind Air is understood to favour outright purchases to reduce long-term operating costs.

Ownership requires significant upfront funding and lender confidence — both of which remain limited at this stage. While aircraft purchases were expected to be largely funded by the company itself, efforts to bring in external investors have yet to result in firm commitments, the report said.

As per the report, sources added that Al Hind had engaged Martin Consulting to advise on the acquisition of two ATR aircraft.

Financing discussions reportedly hit a roadblock after the parent group was unwilling to provide hard collateral, typically required for aircraft purchase financing. Martin Consulting declined to comment, citing ongoing arbitration, added the report.

Delays between Al Hind’s original launch plans and the eventual issuance of the NOC have also increased holding costs. To conserve cash, the airline has placed a majority of its employees on leave without pay, according to people familiar with the matter, said the report.

Without firm aircraft contracts in place, Al Hind Air cannot apply for an air operator’s certificate (AOC) — the final regulatory approval required to commence commercial operations.

When flights do eventually begin, the airline plans to base its operations out of Kochi, connecting the city with destinations across southern India, including select routes under the government’s UDAN programme, it said.

Following operational disruptions and public backlash after the IndiGo incident in December 2025, civil aviation minister Ram Mohan Naidu had publicly called for more airline entrants to deepen competition and reduce over-dependence on a handful of carriers.

Al Hind Air's struggles underline a recurring challenge in Indian aviation: while regulatory approvals may be getting faster, access to capital and aircraft financing remains a steep hurdle — especially for new, regional-focused airlines.