India-Pakistan Ceasefire: Will Travel Platforms Get Relief From Cancellation Spree?

India’s travel tech and online ticketing agent startups and listed giants such as MakeMyTrip, ixigo, Easemytrip, Cleartrip and others expect a hit on their revenues and a slowdown in travel bookings amid heightened tensions on the India-Pakistan line of control and border in the past two weeks.

Even though a ceasefire is now in place between India and Pakistan, online travel majors such as ixigo, , Cleartrip, , Goibibo, Yatra have all seen challenges such as higher cancellations, demands for refunds and clarity on travel advisory from anxious consumers.

As tensions between India and Pakistan continue to escalate, the geopolitical fallout has brought in airspace restrictions and heightened security to the travel and tourism industry, especially given the fact that tourists were targetted in the Pahalgam terror attack.

A source within one of the OTAs told Inc42 on condition of anonymity that flight searches dropped by 23% week-on-week for travel between May 5 and 8, compared to the period from April 20 to May 2. “Just on May 8, around 360 flights were impacted, accounting for nearly 8% of total daily departures under normal conditions,” the person added.

The drop in search volume reflects growing traveller hesitation, and OTAs are already bracing for further declines if the situation persists.

India-Pakistan Clashes Disrupt Travel Revenue

Since the launch of Operation Sindoor by India to target terrorist infrastructure in Pakistan and Pakistan-occupied Kashmir, over 300 flights have been cancelled, and at least 25 airports in northern and western India were temporarily closed, completing disrupting movement and stranding travellers in many cases.

Among the impacted locations were cities such as Srinagar, Leh, Jammu, Amritsar, Pathankot, Chandigarh, Jodhpur, Jaisalmer, Shimla, Dharamshala, and Jamnagar. While as per the latest government directives, these airports are now resuming operations, OTAs expect more challenges.

Operating on a commission-based model, OTAs earn revenue for each completed flight, hotel, or holiday package booking, but have to give this up in case of cancellations due to events such as airport closures.

Additionally, they have to forego additional income through convenience fees, premium services, and platform fees. And with a surge in cancellations and fewer confirmed bookings, primary revenue streams have taken a direct hit, but convenience or platform fees for affected bookings also have to be paid back to consumers.

Support Systems Caught In Slow Lane

On the operational front, most OTAs are struggling to scale up their support systems quickly enough to handle the surge in cancellations and refund requests, resulting in delays and poor customer service experiences.

The pressure of having to deal with mounting cancellations, revenue losses, and operational chaos has clearly been visible on some of these platforms, as many of these platforms have not responded smoothly.

Several OTAs have been facing backlash for delays and inadequate support, with many customers airing their frustrations on social media. A source within Cleartrip told Inc42, “We did see a few panic calls when the situation first escalated. However, since then, we have been actively reaching out to customers and processing refunds proactively.”

Despite the circumstances and official government advisories, some users (particularly of MakeMyTrip and Cleartrip) have claimed that they were denied full refunds from these aggregators. While some users were asked to approach airlines directly, others were only issued partial refunds with platform and convenience fees still deducted, leaving them feeling cheated and ignored.

Our source at Cleartrip further added that after the confusion of the first few days, the platform is taking a more proactive approach, reaching out to customers and processing refunds directly, without waiting for them to call first.

“We are offering a combination of full refunds and alternate rescheduling options. For full refunds, we’re also refunding the convenience fee. In some cases, we may redirect customers to the airlines, but we are trying to make the process smoother. We’ve also made sure to provide updates on our customer support platforms and social media.”

Inc42 reached out to MMT, but the company declined to comment on these complaints. However, a source within the company told Inc42 that the entire refund process is handled by the airlines, and MMT is not directly involved in the process.

Cancellations Test OTA Resilience

Besides dealing with the spate of cancellations, travel platforms sent out travel advisories to customers throughout last week.

Following MMT’s on its social media pages, Cleartrip also shared a travel advisory on May 9, stating: “In case your flight gets cancelled due to changing airspace conditions, rest assured, we will initiate your full refund. It will reflect in your account within 3-5 business days. You don’t need to follow up or raise a request; we will take care of it. If you prefer to reschedule your flight, you can reach out to our support team.”

On the flip side, some OTAs have been criticised for taking advantage of this difficult situation.

Aloke Bajpai, Group CEO of listed giant ixigo, shared with Inc42 that the company had launched a travel advisory page to provide real-time airline updates in one place.

He added that ixigo was actively sharing verified information and updates on airport operations and important airline advisories through its social media platforms. “We are also working closely with airline partners to streamline refund and rescheduling workflows,” Bajpai said.

On top of this, the listed company also suspended flight and hotel bookings to Turkey, China, and Azerbaijan after these countries expressed solidarity with Pakistan in the past week.

EaseMyTrip cofounder and CEO Rikant Pittie also indicated that the platform is closely monitoring the evolving situation and prioritising safety by supporting government directives. He pointed out that several airlines have reduced or suspended operations, which has led to a sharp rise in cancellations and rescheduling across travel services.

According to EMT’s cofounder, the tourism sector, particularly in regions like Kashmir, has been significantly impacted. “Following the Pahalgam attack, there has been a sharp decline in flight bookings, with hotels and houseboats offering discounts of up to 70% to attract visitors. The once-booming industry, which drew over 3 Mn visitors to Indian Kashmir last year, now faces a prolonged downturn.”

While the current geopolitical tensions may eventually subside, their impact on the revenue and growth trajectories of OTAs is likely to become more evident in the coming quarters.

Nasdaq-listed online travel aggregator MakeMyTrip (MMT) reported for the quarter ended December 2024 (Q3 FY25), on a revenue base of $267.4 Mn.

Among other listed players, Easemytrip’s profits while ixigo’s consolidated net profit slumped.

Even though the most recent disruption was not prolonged, the question is whether the ceasefire is enough to calm the nerves of travellers and their cancellation spree?

[Edited by Nikhil Subramaniam]

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