Aviation in India - Soaring High
Market Updates
- 9th largest in the world
- To be among the top five global aviation nations by 2020
- Handles 2.5 billion passengers across the world in a year
- Moves 45 million tonnes of cargo through 920 airlines, using 4,200 airports and deploys 27,000 aircraft
- 87 foreign and five Indian carriers fly to and from 40 countries
- Attracted FDI worth US$ 423.31 million from (2007-2011)
- CAGR growth rate of 15 percent
The Indian aviation industry is the ninth largest in the world. Propelled by the government’s `open sky policy’, experts foresee the sector to be in the top five worldwide. Experts predict that nearly 50 million passengers will be served by the India aviation industry by 2015.
The Indian aviation industry has experienced a magical transformation with the entry of privately owned full service airlines and low cost carriers. These private carriers today account for more than 75 percent share of the domestic market.
To cater to this business opportunity, the emphasis has been on modernization of non-metro airports, fleet expansion by airlines, service expansion by state owned carriers, development of the maintenance, repair and overhaul (MRO) industry in India, opening up of new international routes by the Indian government, establishment of new airports and renovation and restructuring of the existing airports have added to the growth of the industry.
Future of Aviation industry in India
With a surging demand and with the entry of a large number of domestic and international companies into the sector, the Indian aviation industry is witnessing a growth showing in a CAGR rate of nearly 15 percent. It is also estimated that the Ministry of Civil Aviation in India will alone handle about 280 million passengers by the year 2020. Industry experts envisage about US$ 110 billion new investments in the Indian aviation sector with not less than US$ 80 billion exclusively targeted for the purchase of new aircraft and US$ 30 billion for developing the infrastructure at the airports.
The growth of the aviation sector has potential to absorb up to US$ 120 billion of investment. Fleet size of commercial airlines sector will be approximately 1,000 aircraft, domestic passenger numbers could reach 150-180 million, Helicopter fleet is expected to be 500, while the air cargo movement is expected to reach the level of 9 million MT. The sector is expected to have the potential to absorb 3 million jobs directly by 2020. The Vision 2020 announced by the Ministry of Civil Aviation also conceives of building infrastructure to support about 280 million customers.
Source: India Brand Equity Foundation, www.entrepreneur.com