India's Aviation Sector Faces Flight Cancellations and Financial Strains Amid Middle East Tensions

India's aviation sector faced significant challenges in 2025 and early 2026, including a fatal air crash killing 260 people and widespread flight cancellations due to regulatory compliance and Middle East tensions. The Israel-US-Iran conflict led to airspace restrictions and disrupted the India-Gulf corridor, a key route for business and migrant travelers. IndiGo, India's largest airline, canceled over 500 flights amid evolving airspace limits, with rising fuel costs and geopolitical risks expected to impact airline profitability and fare competitiveness.