Eva's exit comes at a time when Indian carriers like state-owned Air India and leading private airline Jet Airways are aggressively expanding their international operations especially to Southeast Asian and US destinations and Kingfisher Airlines is also planning to fly to the Bay area by August.

According to the apex air transport monitoring body International Air Transport Association (IATA), in 2006-07 airlines operating out of India carried 22.4 million international passengers, with an increase of over 15 percent over the previous year.

The Centre for Asia Pacific Aviation, an aviation consultancy, predicted that international traffic to and from India would grow at this rate till 2010.

Aniket Mhatre, an analyst with brokerage firm Prabhudas Liladhar, said Eva Air's withdrawal from India is due to the problems the airline faced.

"The profitability of an international carrier is solely dependent on the routes undertaken by them. The increase in the price of aviation turbine fuel (ATF) is leading to the rise in fares. As a result, there is a dip in the load factor," he said.