I strongly suspect this move is partly as a result of the relentless capacity expansion by Emirates Airlines across India.
With its non-stop connectivity to both the coasts of the United States, and Europe from Dubai, Emirates has been steadily poaching passengers from all other airlines across India. At Chennai, Emirates, will be increasing to 19 flights a week in February, and to thrice daily by end of the year.
In the recent past British Airways has withdrawn from Kolkata, KLM from Hyderabad, and Austrian Airlines from Mumbai. Alitalia completely withdrew, but then, those are due to its bankruptcy.