IndiGo staring at ₹1,180 cr-plus impact after DGCA’s final order on December disruptions

India’s aviation regulator, the Directorate General of Civil Aviation (DGCA), on Friday, January 16, issued its final enforcement order against IndiGo over the large-scale flight disruptions in December 2025, putting the airline’s total financial exposure at over ₹1,180 crore when penalties, passenger compensation, refunds and compliance-linked safeguards are taken together.

As part of the order, DGCA imposed ₹22.20 crore in monetary penalties on IndiGo for systemic lapses and continued non-compliance

with Flight Duty Time Limitation (FDTL) norms. The penalty includes ₹1.80 crore in one-time systemic fines and ₹20.40 crore for continued non-compliance over 68 days.

Beyond the fines, the regulator has directed IndiGo to furnish a ₹50 crore bank guarantee under the IndiGo Systemic Reform Assurance Scheme (ISRAS). The guarantee will remain blocked and will be released in phases only after DGCA verifies the airline’s compliance with mandated reforms across leadership oversight, manpower planning, rostering systems and digital operational resilience.

The largest component of the exposure stems from passenger-facing costs. IndiGo has said it will pay over ₹500 crore in compensation to severely affected passengers whose flights were cancelled within 24 hours of departure and who were left stranded at airports during the disruption period.

In a statement, IndiGo said it will provide over ₹500 crore in compensation to severely affected passengers. The airline also said it has extended an additional “Gesture of Care” voucher of ₹10,000 per passenger, valid for 12 months, to customers whose flights were cancelled or delayed by more than three hours between December 3 and 5, 2025.

In addition,IndiGo had processed ₹610 crore in ticket refunds up to December 7, returned to passengers through the original mode of payment. The airline has indicated that the refund figure is expected to rise further, as refunds processed beyond that date are not included in the disclosed number.

While refunds do not impact profitability, they represent a significant cash outflow. Taken together, IndiGo’s direct profit-and-loss impact stands at over ₹522 crore, including compensation and penalties, while the inclusion of refunds and the bank guarantee takes the overall financial exposure beyond ₹1,180 crore, with the final number likely higher as additional refunds are accounted for.

In its order, DGCA acknowledged that IndiGo’s operational recovery after the December disruptions was swift, with flight operations returning to normal levels in a short period. The regulator said no further punitive action is being initiated at this stage, with future oversight tied to compliance milestones under the reform framework rather than fresh penalties.

DGCA attributed the December disruptions to over-optimisation of operations, inadequate roster buffers and shortcomings in planning and management oversight, underscoring the need for sustained systemic reforms to prevent recurrence.