Aviation

Aviation Is The Proof That Gives The Will, We Have The Capacity To Achieve The Impossible

Over the past three years, the civil aviation sector in India has become one of the fastest-growing industries in the country. India is now the third-biggest domestic aviation market globally and is projected to surpass the UK to become the third-largest air passenger market by 2024.

In India, the civil aviation sector has shown significant growth over the past three years and is categorized into scheduled air transport (covering domestic and international airlines), non-scheduled air transport (including charter and air taxi operators), and air cargo service (involving transportation of cargo and mail). Approximately 69% of all airline traffic in South Asia comes from domestic flights, and India is projected to have the capacity to accommodate 1 billion trips per year at its airports by 2023. The Indian aviation sector has bounced back completely from the impact of the COVID-19 pandemic as shown by the air traffic volume reaching 327.28 million in FY23, up from 188.89 million in FY22.

Indigo holds the biggest market share among Indian airlines as the largest company in the industry. India has grown to become the world's third-largest market for domestic aviation and is projected to surpass the UK as the third-largest air passenger market by 2024.

• India's total number of passengers in FY20 was 341.05 million. It expanded with a CAGR of 11.13% from FY16 to FY20. During FY21, which ran from May 2020 to March 2021, Indian airports reported domestic passenger traffic of approximately 53.4 million, showing a year-on-year drop of around 62% compared to the fiscal year ending on March 31, 2020. In February 2021, the mean number of passengers per flight was 121, compared to an average of 136 passengers per flight in February 2020. During FY16-FY20, there was a 5.01% compound annual growth rate in international passenger traffic, reaching a total of 66.54 million.
• During the period FY16-FY20, there was a compound annual growth rate (CAGR) of 5.32% in freight traffic, increasing from 2.70 million tonnes (MT) to 3.33 MT. The transportation of goods is projected to increase by an average of 7.27% annually, reaching 4.14 million tons by the end of fiscal year 2023.
• Aircraft activity increased at an annual average rate of 9.56% from 1.60 million in FY16 to 2.59 million in FY20. Between FY16 and FY20, there was a compound annual growth rate of 9.83% in domestic aircraft movement and 3.57% in international aircraft movement. During FY20, India saw growth in both domestic and international aircraft movements, reaching 2,155 thousand and 433 thousand, respectively.
• In response to the increasing air traffic, the Indian government is focused on expanding the number of airports. In 2020, there were 153 functioning airports in India. India plans to have 190-200 operational airports by FY40.
• Additionally, the increasing need in the industry has resulted in an escalation in the quantity of airplanes functioning within the industry. It is anticipated that the quantity of airplanes will hit 1,100 aircraft by 2027.

Research and development in India's aviation industry have increased significantly due to current trends indicating further expansion. The number of airports in the country has increased from 74 in 2013-2014 to a projected 220 by 2024-2025.

The government is partnering with private companies to invest heavily in infrastructure to create jobs for several hundred thousand individuals in the next ten years. There has been a rise in the amount of passengers as well.

There is hope for the future, as there is predicted to be substantial growth in global travel and transportation of goods. Government initiatives, such as UDAN, have increased regional linkages, while advancements in technology, like AI and automation, offer improved effectiveness and reduced expenses.

• Several significant projects have been implemented by the Government.
• During the initiation of the 'Azadi Ka Amrit Mahotsav (India@75)' by the Indian Government in March 2021, the Ministry of Civil Aviation (MoCA) suggested 392 routes as part of the UDAN 4.1 bidding process.
• The Airport Authority of India is considering eliminating royalties and providing significant discounts on lease rent in order to attract MRO units to establish facilities at its airports.
• The government intends to establish 14 additional water aerodromes nationwide, following the triumphant initiation of a seaplane service by Prime Minister Narendra Modi, connecting the Statue of Unity near Kevadiya in Gujarat's Narmada district with Sabarmati Riverfront in Ahmedabad in October 2020.
• In November 2020, the Indian Government stated that it plans to raise the cap on domestic flights to 75% of pre-COVID-19 levels, anticipating more passengers during the festive and holiday period.
• In September 2020, the Indian Government approved the allocation of Rs. 108 crore (equivalent to US $14.73 million) has been allocated for the enhancement and growth of Jagdalpur, Ambikapur, and Bilaspur airports in Chhattisgarh through the UDAN scheme.
• In the Union Budget 2021-22, the government reduced the customs duty on components, including engines, used in aircraft manufacturing by public sector units of the Ministry of Defence from 2.5% to 0%.
• In the Union Budget 2021-22, the Indian government widened the coverage of 'Krishi Udaan' in coordination with Operation Green Scheme, offering a 50% air freight subsidy for agricultural perishables to North-East states and 4 Himalayan states/Union Territories. Increasing the range of products covered will enhance the effectiveness of the 'Krishi Udaan' program and enhance air cargo transportation from these states.
• In February 2019, the Indian Government approved the construction of a new airport in Hirasar, Gujarat, with an expected investment of Rs. 1,405 crore is equivalent to US$ 194.73 million.
• The Regional Connectivity Scheme (RCS) has been initiated.

India's aviation sector has great potential for growth as it remains widely unexplored due to the high cost of air travel for the majority of the population, including around 40% of the growing middle class.

Industry stakeholders need to work together with policymakers to put into action effective and logical decisions that will enhance India's civil aviation industry. By implementing appropriate strategies and maintaining a strong emphasis on excellence, affordability, and customer satisfaction, India could successfully reach its goal of becoming the third-largest aviation industry by 2020. Indian travelers' spending is projected to increase to Rs. 136 billion US dollars in 2021. Because of an increase in air travel demand, India will require 2,380 additional commercial aircraft by 2038.

The Indian aviation industry is currently in a transformative phase, ready to reach new heights. Due to increasing demand, strong government initiatives, strategic infrastructure development, and technological advancements, the sector has the potential to outperform its global counterparts. Despite facing obstacles like regulatory barriers, infrastructure limitations, and economic instability, industry stakeholders must adopt flexible and cooperative strategies.

Corpseed provides a range of services to support the aviation sector in navigating regulatory compliance, obtaining necessary licenses and permits, and ensuring operational efficiency