India’s Growing Civil Aviation Sector

by Apr 29, 2023Business & Infrastructure0 comments

India’s aviation industry has experienced significant growth in the past 9 years. The number of operational airports in the country has doubled from 74 in 2014 to 148 in 2023.

This growth can be attributed to the government’s consistent efforts to improve airports and aviation infrastructure. One such initiative is the Regional Connectivity Scheme – “Ude Desh ka Aam Nagrik” (RCS-UDAN) launched in 2016, under which 469 routes connecting 74 airports have been made operational, providing affordable air travel options for millions of Indians.

Additionally, the increase in airports has been accompanied by continuous efforts towards sustainability. The Level 4+ Carbon Accreditation received by Delhi and Mumbai airports is indicative of the aviation industry’s efforts towards sustainability.

The Airport Authority of India (AAI) has developed a roadmap to achieve 100% renewable energy for all its remaining operational airports by 2024, demonstrating a commitment to sustainable practices. The industry is expected to continue to grow and adopt sustainable practices, promoting a cleaner, more efficient, and prosperous aviation industry in India.

A recent report by the India Brand Equity Foundation ( IBEF) says that India has become the third-largest domestic aviation market in the world and is expected to overtake the UK to become the third-largest air passenger market by 2024.

Indian aviation also contributed 5% of the GDP, creating a total of 4 million jobs. In addition to it, there is a US$ 72 billion gross value-added contribution to GDP by this industry.

According to the IBEF, the advantages and significance of the aviation sector can be highlighted by the following ideas:

– The aviation sector offers global connection, which is crucial for advancing international trade and business. Further, it greatly influences how a nation’s economy is shaped by linking it to other nations and continents.

– It also plays a crucial role in promoting tourism by offering a robust transportation network. The promotion of the tourism industry also helps the economy and employment sector both domestically and globally.

– The aviation sector has played an important role in natural catastrophes or even in conflicts. During times of famine, supplies, human transport, and food are all handled by the aviation sector. In addition, a specially outfitted plane responds to forest fires and even protects crops by spraying pesticides and fertilizer on them.

– The aviation industry not only transports passengers from place to place but also greatly contributes to the transportation of all types of cargo around the world.

India has a vast history in the field of aviation. During the initial years of the Indian aviation industry, the operations of air transport were entrusted to three public undertakings, namely:

– Air India for international services

– Indian Airlines for domestic services and services to neighbouring countries

– Vayudoot

The IBEF says that The improved connectivity across the globe has contributed to the growth of the aviation sector at a faster rate. There have been a lot of changes since the inception of the sector, but despite all these, it has always proved its value and considerable power. These values continue to increase because of the vast geographical coverage of the country and the continuous industrial growth. Economic growth, along with the rising working class of the Indian middle class, also contributes to the industry and as a result, the Indian government is planning to set up new airports 220 by 2025.

The government is focussing on building infrastructure with the support of the private sector to make it more feasible with collaboration. Nearly US$ 11.8 billion (INR 98,000 crores) over a four-year period would be spent by the Ministry of Civil Aviation on the construction of new greenfield airports and the development of existing brownfield airports. Out of this, the private sector will contribute US$ 7.5 billion (INR 62,000 crores), while the Indian government will invest US$ 4.3 billion (INR 36,000 crores) through AAI.

Some of the key findings by the IBEF are :

– India’s airport capacity is expected to handle 1 billion trips annually by 2023

– India’s domestic traffic makes up 69% of the total airline traffic in South Asia.

– There has been a growth of over 33% in the number of passengers carried by Indian domestic carriers in 2021 as compared to 2020. (838.14 lakh passengers in 2021 while 630.11 lakh passengers in 2020).

– By 2024-2025, the number of airports is expected to reach 220.

– In 2013-14, there were 400 aircraft in the nation and currently, there are 710 aircraft with more than 100 planes expected to join each year.

– The Ministry of Civil Aviation (MoCA) stated that it is likely to employ 1 lakh more people by 2024, which shows an increase in direct employment from 2.5 lakhs to 3.5 lakhs.

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