India’s largest airline, IndiGo, is expecting to run at full capacity on the domestic routes, a sign of recovery in aviation from the clutches of the pandemic as the number of cases come down in the country.

Speaking to Bloomberg Television, IndiGo CEO Ronojoy Dutta said that “things are improving slowly’’ and that it was not “hard to be bullish as traffic is going up’’.

He said the load factor at present for the airline is 70 per cent and that it is targeting just over two-thirds capacity in the international market.

His comments come after parent InterGlobe Aviation reported a net loss of Rs 3,174 crore for the three months ended June 30, 2021, with the second wave of Covid-19 adversely impacting its performance. Losses in the corresponding quarter a year ago were lower at Rs 2,844 crore. During the January-March quarter, the airline had operated at 75 per cent of pre-Covid capacity, which dipped to 44 per cent in April-June 2021.

In a conference call with analysts in July, Dutta had said the main aim was to add capacity to get back to pre-Covid levels as quickly as possible.

During the second quarter, the airline like the others was restricted to 65 per cent capacity deployment and it provided scheduled services to 66 domestic destinations. The capacity limit was raised to 75.2 per cent from August 12.

When the pandemic struck last year, the Centre had lowered capacity to just 33 per cent of the pre-Covid level on domestic routes, which was raised to 80 per cent in January 2021.

The second wave led to fresh restrictions: capacity was reduced to 50 per cent from June, which was raised to 65 per cent in July and then 75 per cent in August.

The ban on international flight remains and has been extended till the end of this month. Bilateral flights with select countries such as the US and UK under the air bubble arrangement are operational since July 2020.

Dutta’s comments also come at a time of a pick-up in domestic traffic. A recent report from credit rating agency Icra said passenger traffic rose 31 per cent to 66 lakh from 51 lakh in the previous month, helped by higher capacity deployment and a downward trend in the pandemic. On a year-on-year basis, the domestic passenger traffic shot up around 131 per cent to over 28.3 lakh in August.

The rating agency said capacity deployment in August was up 99 per cent to 57,500 departures against 28,834 departures a year ago while on a sequential basis, it was higher by around 22 per cent.

However, there is a continued stress on demand despite a recovery in August, driven by the second wave of the pandemic that has limited travel to only for necessary purposes. Observers said it remains to be seen if the Centre further relaxes the capacity deployment on domestic routes given the concerns of a third wave.