Passenger jets of Air India, the national carrier, sit idle at Indira Gandhi International Airport in New Delhi. The continuing strike by the pilots has led to the cancellation of dozens of flights. Image Credit: AP

Hyderabad: India is planning to invest over $120 billion (Dh440.4 billion) in the development of airport infrastructure and aviation navigation services over the next decade with the civil aviation sector poised for fast growth, said President Pranab Mukherjee on Wednesday.

Inaugurating India Aviation 2016 here, he said the sector is poised for a faster and sustainable growth with the development of 100 smart cities; new economic corridors; more than 50 new airports and expansion of existing airports.

“The deeper air penetration to smaller cities; better connectivity to northeastern part of India; higher disposable incomes of the middle class of India is expected to further propel the growth of Indian civil aviation industry,” he said.

Mukherjee noted that India registered a growth of 14 per cent in civil aviation sector during the last decade. With foreign direct investment (FDI) in air transport during the last 15 years touched the mark of $570 million, he said India continues to be a favourite destination for foreign investors in civil aviation sector.

The government has allowed FDI through the automatic route to the tune of 100 per cent in green field airports; helicopter services and seaplanes; maintenance and repair organisations and flying training institutes. He also pointed out that 49 per cent FDI is allowed through the automatic route for domestic scheduled passenger airlines and ground handling services.

“The open sky policy; greater focus on infrastructure development; liberal FDI norms; robust technical and engineering capabilities; assured supply of skilled workforce in information technology and communication network has opened the doors to global players. This will make India a manufacturing hub of the aerospace industry,” he said.

Policy initiatives

Mukherjee said as India is at the threshold of taking a major leap in the aviation sector, this event is well timed and resonates well with the latest policy initiatives of “Make in India”, “Stand up India” and “Start up India”. He called upon the global giants to seize this opportunity and take lead to forge long-term partnerships.

He also noted Indian civil aviation market is growing at a rapid pace and now ranks ninth in the world. It is estimated that by 2020, India would be the third largest civil aviation market. With a network of domestic and 85 international airlines connecting 40 countries, Indian airports handled passenger traffic of 190 million persons in 2015.

“Yet India is one of the least penetrated air markets in the world with 0.04 trips per capita per annum as compared to 0.3 per cent of China and more than 2 in the USA,” he said.

The president also noted that despite rapid growth of civil aviation industry in India, several Tier II and Tier III cities as well as the northeastern states still remain unconnected or inadequately connected with the national grid.

Stating that by 2020, the total passenger traffic in India is likely to touch 421 million, he urged the government and all stakeholders to leverage this tremendous business opportunity.

“It is estimated that India shall require at least 800 aircraft by 2020 to cater to the phenomenal increase of air passenger and freight traffic. The supporting aviation infrastructure has to be suitably upgraded by building new greenfield airports; expanding the existing airports and upgrading facilities for maintenance, repair and operations.”

Partner countries

The five-day biennial event, the biggest conference and exhibition on civil aviation in the country, is being attended by delegates from 25 countries. More than 200 companies are participating in the event being held at Begumpet Airport.

As many as 29 aircraft are on static display. Canada and US are the partner countries for the event which has the theme “Indian civil aviation sector: Potential as global manufacturing and MRO hub”.

Civil Aviation Minister Ashok Gajapathi Raju said the aviation said for last one-and-half year the sector has registered good growth, attracting attention of all.

Civil Aviation Secretary R. N. Choubey said the civil sector was growing at 20 per cent per annum. “The growth in domestic flying is 25 per cent per annum which is unparalleled and which is not happening anywhere in the world, a he said.

Telangana and Andhra Pradesh Governor E.S.L. Narasimhan and Telangana Chief Minister K. Chandrasekhar Rao were also present.


Factbox: Airbus upgrades aircraft sale forecast for India

Hyderabad: With Indian aviation market registering healthy growth in 2015 and expected to become world’s leading emerging market over next 20 years, Airbus has upgraded aircraft sale forecast for India by 300 aircraft.

According to Airbus’ latest global market forecast for 2015-2034, India will require over 1,600 new passenger and freighter aircraft to help meet growth in demand. Valued at $224 billion (Dh822 billion), these will include 1,230 new single aisle aircraft and 390 wide body passenger and freighter aircraft.

Joost Van der Heijden, vice president, marketing, Asia, Airbus told reporters on Thursday at India Aviation 2016 here that on an average one Airbus aircraft will be delivered per week in India over the next 10 years.

He said 56 per cent of India’s in service fleet are Airbus aircraft operated by most leading Indian carriers.

According to the leading aircraft maker, traffic serving the Indian market is set to grow at 8.4 per cent per year over the next 20 years, well above the world average of 4.6 per cent. Domestic Indian traffic will grow more quickly at 9.3 per cent — making India the world’s leading emerging aviation market.

Bullish over the growth in the Indian market, Airbus received 250 new orders during 2015.

The company officials, however, clarified that this does not include orders from now defunct Kingfisher Airlines.

The orders received last year include orders for 250 A320neo by IndiGo, which it termed as the world’s largest civil aviation order. The other orders include 72 A320neo by Go Air.