Indian Civil Aviation on the upswing

By Editor 13-Mar-2020

News

India’s civil aviation industry has witnessed plenty of action during recent years. Rise in passengers, new airports and novel government programmes have made India the third biggest civil aviation player in the world.

India is the third biggest and one among the fastest growing civil aviation markets in the world. To meet the demand of the rising air traffic, the Government of India is increasing the number of airports in the country. As per official data, India has 103 operational airports as of March 2019 and it is planned to raise this figure to 190- 200 by financial year 2040. The increase in passengers has also witnessed additions to the aircraft fleet. As of July 2018, around 620 aircraft were being operated by scheduled airline operators in India and number was expected to grow to 1,100 planes by 2027.

According to the Department of Industrial Policy and Promotion (DIPP), FDI inflows in India’s air transport sector reached US Dollars 1,904.37 million between April 2000 and June 2019. India’s aviation industry is expected to witness an investment of Rs 35,000 crore (US dollars 4.99 billion) in the next four years. The Indian government also has plans to invest US Dollars 1.83 billion for development of airport infrastructure along with aviation navigation services by 2026. India’s aviation industry has witnessed a lot of action during the recent years. For instance, in December 2019, France-based Safran Group said it was considering an investment of US Dollar 150 million in a new aircraft engine maintenance, repair and overhaul (MRO) unit in India to cater to its airline customers. In November 2019, the Competition Commission of India (CCI) approved the acquisition of shareholdings in Mumbai International Airport Limited (MIAL) by Adani Properties Private Limited(APPL).

Meanwhile, the UK group said it will invest Rs 950 crore (US Dollars 135.9 million) in Turbo Aviation’s new airline TruStar. The Airports Authority of India (AAI) also said it would be investing Rs 15,000 crore (US Dollars 2.32 billion) for expanding existing terminals and constructing 15 new ones. Indian aircraft Manufacture, Repair and Overhaul (MRO) service providers were exempted completely from customs and countervailing duties. The Government of India also introduced various measures to boost civil aviation in the country. According to the Union Budget 2019-20, the government will promote aircraft financing and leasing activities to make India’s aviation market self-reliant. In February 2019, the Government of India sanctioned the development of a new Greenfield airport in Hirasar, Gujarat, with an estimated investment of Rs 1,405 crore (US Dollars 194.73 million). In January 2019, the government organised the Global Aviation Summit in Mumbai which witnessed participation of over 1,200 delegates from 83 countries. The same month, the Government of India’s released the National Air Cargo Policy Outline 2019 which envisages making Indian air cargo and logistics the most efficient, seamless and cost and time effective globally by the end of the next decade.

Yet another significant step has been the launch of the Regional Connectivity Scheme (RCS). Under RCSUdan scheme, approximately 34,74,000 passengers were flown, and 335 routes awarded during the year 2019 covering 33 airports (20 unserved, 3 underserved and 10 water aerodromes). Marking a milestone, the number of Operational Airports crossed 100 in the financial year 2019. In September 2018 Pakyong Airport in Sikkim was inaugurated. It is Sikkim’s first ever airport and AAI’s first Greenfield airport construction. In December 2018, Kannur International Airport was inaugurated making Kerala the only state in India to have four international airports. Due to rise in demand in air travel, India will need 2,380 new commercial airplanes by 2038. Air India is India’s national flag carrier. It merged with Indian in 2011 and plays a major role in connecting India with the rest of the world. IndiGo, Air India, Spicejet, GoAir, Vistara and AirAsia India are the major carriers. These airlines connect more than 80 cities across India and also operate overseas routes after the liberalisation of Indian aviation. Several other foreign airlines connect Indian cities with other major cities across the globe. Meanwhile, the Mumbai– Delhi air corridor is ranked the world’s third-busiest route.