Exclusive: Despite Challenges, Indian Aviation Journey Soaring To New Horizons

The recent Paris Air Show was filled with excitement as Airbus struck an unprecedented deal, announcing an order for 500 narrow body jets from India’s own budget carrier IndiGo. The aviation industry was flourishing as Air India Limited also embarked on a mission to acquire 540 aircraft from Boeing and Airbus. These extraordinary agreements come as no surprise, given that India ranks third in the world in terms of domestic air traffic, reflecting the country’s emergence as a global aviation superpower. The growth in air travel is driven by the aspirational middle class, increasing the demand for flights across the country.

With over 140 million passengers in FY2024 and an estimated 1.3 billion passengers annually within the next two decades, India’s domestic market is growing at an unprecedented pace. In fact, in the same month, domestic carriers carried over 13 million passengers, cementing India’s position as the third largest domestic market globally.

As the industry continues to flourish, expansion of Maintenance, Repair and Overhaul (MRO) facilities has become a priority. Positive signs emerged when the Goods and Services Tax (GST) rate for MRO services was reduced from 18% to 5% in 2022, reducing the financial burden. Besides, the extension of the Emergency Credit Line Guarantee Scheme (ECLGS) of the finance ministry eased the liquidity stress caused by the pandemic, indicating the government’s support for the aviation sector.

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Despite the overall optimism, Indian aviation has faced its fair share of challenges. The recent crisis faced by GoFirst highlights the formidable constraints facing airlines, including operating expenses, fuel costs and intense competition. However, amid these challenges, new players such as Akasa Air have taken off. Backed by the late Rakesh Jhunjhunwala, the low-cost airline expanded its fleet by ordering additional Boeing 737-8 aircraft, a sign of confidence in India’s aviation market.

Initiatives like the Regional Connectivity Scheme (RCS) play a vital role for the industry to flourish. By capping airfares and allotting seats for RCS flights, the scheme increases access for passengers, thereby contributing to sustainable low-cost aviation. The coordination between the Indian Air Force and route rationalization promises better airspace management and efficiency.

In addition, digitization initiatives like ‘e-Sahaj’ portal and ‘digi-Yatra’ as well as smart technologies like AI streamline operations and enhance the overall passenger experience. While India’s aviation industry continues to grow, the need for world-class infrastructure remains a priority.

The World Economic Forum’s ranking of India’s airport infrastructure quality highlights the demand for around 200 new airports to accommodate the growing customer base. Developing new airports, investing in modern air traffic control systems, promoting public-private partnerships and simplifying the regulatory framework are essential steps towards realizing India’s goal of becoming a global aviation force.

Furthermore, the shortage of skilled pilots is a significant challenge for the industry. With only 9,000 pilots currently flying the 700 aircraft, the demand for an additional 1,800 to 2,000 pilots within the next year emphasizes the urgency of more flight training organizations. Boeing’s projections of a need for 31,000 pilots and 26,000 mechanics over the next two decades underscore the need for world-class training infrastructure to meet these demands and prepare the next generation of aviators.

India’s aviation capability is no longer idle; It is flying with ambition and determination. By nurturing raw talent, leveraging the country’s tourism potential, and improving domestic and international connectivity, India is set to conquer new horizons in the global aviation landscape.

This article has been written by Jaideep Mirchandani, Founder and Chairman, SkyOne FZE. All views are personal.