Home' Asian Aviation : AAV September 2017 Contents VIEWPOINT
4 AsianAviation | September 2017
India, the ‘other’ Asian giant
CHINA HAS, FOR THE PAST SEVERAL YEARS, gotten the lion’s
share of press when it comes to development of its aviation sector.
That’s good for China, but it ignores the ‘other ’ Asian giant of India,
which itself is undergoing dramatic change when it comes to com-
mercial aviation. Boeing, as we report in this issue, just issued an
updated and upbeat forecast for aircraft sales on the subcontinent
as it races ahead to become the third-largest aviation market by
2020, according to various organisations like IATA, CAPA and others.
Indian airlines, both legacy full-service and low-cost carriers,
are moving full speed to open new routes both domestically and
internationally and even the once vaunted Air India is sensing the
changes on the horizon with the government making plans to sell
off the carrier and its subsidiaries as it realises that Air India must
adapt or die, as we also report in this issue.
India has lagged China for many reasons when it comes to avi-
ation development. As a journalist resident in
Asia for nearly 20 years, I’ve often been inter-
viewed on television about China and India
and my only slightly tongue-in-cheek reply
when asked about the differences is that I tell
people India “suffers” from being a democratic
nation. In a small way, that is actually true. Chi-
na has a command economy — when Beijing
orders a new airport built or a poorly perform-
ing airline shut down, that order is carried out.
India however, and the powers that be, have to
satisfy multiple constituents such as local and state governments,
the private sector and farmers (an important group because India
has strict laws on land acquisition for things like airports and farmers
are a protected group to a large extent).
Despite the democratic ‘handicap’ that India suffers from, the
country, for the first time in a decade, saw its domestic airlines post
a combined profit of US$122 million in 2016. As mentioned above,
Boeing is upbeat on the country ’s future when it comes to aviation as
are a number of other companies. Rolls-Royce, the UK-based aircraft
engine manufacturer, has opened a new defence service delivery cen-
tre (SDC) in Bengaluru to handle more than 750 engines for the Indian
military, Qatar Airways is planning to start India’s first fully owned
foreign airline in partnership with the Qatar Government’s investment
arm, Qatar Investment Authority, and GVK Power & Infrastructure will
spend US$2.48 billion to build a new airport in Mumbai. India is also
moving rapidly ahead in signing Open Sky agreements with other
countries and the government has moved quickly to implement its
Regional Connectivity Scheme that it hopes to use to spread regional
aviation to the smaller cities throughout the huge country.
One problem facing India — and pretty much the rest of Asia
for that matter — is the lack of infrastructure. Here too, though, the
government has recognised that and is working to make the invest-
ments needed to allow the aviation sector to reach its potential as
estimated by CAPA and other organisations.
The Indian government has approved the construction of 18 green-
field airports in the country at a cost of about US$4.66 billion. A gov-
ernment panel has also approved a proposal to revive 50 un-served
and under-served airstrips in three financial years starting from
2017-18 at an estimated cost of US$698.7 million and aviation officials
have said the government plans to double the number of airports in
India over the next two to three years to cater
to the increased passenger traffic due to the
developing regional air travel market.
Various government agencies are also
working to promote the upgrading of skills
for everyone from MRO technicians to senior
people in leadership positions to fill the gap in
demand in the industry.
If India is able to overcome its democratic
handicap, the clear winners will be the up and
coming middle class that is growing exponen-
tially and has an appetite for travel, the smaller cities that will find
themselves connected to the larger cities and low-cost carriers
(LCCs) who will dominate the market. Those LCCs already operate
from a position of strength with 65 percent of the market, which is
expected to grow to 80 percent by 2018.
Perhaps the largest challenge is India’s New Civil Aviation Policy,
which was announced last year. The CAPA centre said it believes
while the new policy is a “welcome development ”, the policy is
flawed in many respects and could “inadvertently act as an obstacle
to achieving desired objectives”. Let ’s hope India works on those
flaws to deliver the growth the country deserves.
Matt Driskill EDITOR
New developments in Down
Under and throughout the region
One problem facing
India — and pretty much
the rest of Asia for
that matter — is the
lack of infrastructure.
SOUTH KOREAN LCCs
Can they compete with
their rivals in SE Asia?
Is there enough training infrastructure
to fill anticipated shortages?
10/08/2017 4:50:02 PM
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