Air travel booms in India, strains creaky infrastructure

Air India


Lightson Ngashangva still remembers the long train journeys followed by interminable bus rides each summer when he went home from New Delhi to his village in India’s remote northeast.

Now, when the 26-year-old biotechnology student visits his home in Manipur state, his nearly three-day long journey by train and bus has been reduced to a four-hour flight.

A fast-growing economy and an expanding middle class have made India the world’s fastest growing air travel market.

The number of passengers grew 20 percent last year and airlines are announcing flights to new destinations almost every week.

And yet, Indian airlines are in distress.

Experts say the explosion in air travel of the past decade has happened despite major hurdles in the form of high jet fuel prices, lack of aircraft maintenance infrastructure, choked airports working beyond their capacities and fierce fare wars that have many carriers in the red.

Although the problems appear huge, the size and potential of the Indian market continues to draw new players and several foreign airlines have also entered the market.

Out of a 1.2 billion population, only about 70 million Indians fly on domestic routes in a year, just a quarter of the size of air travel in China which has a similar population.

Air travel in India is “showing double digit growth and will continue to grow at double digits for the next 10 to 15 years,” said Kapil Kaul, regional head of the Center for Asia Pacific Aviation.

Indigo, India’s biggest and most profitable airline, ordered 250 new A320neo aircraft from Airbus in August in a whopping $26.6 billion deal.

At the Dubai Airshow in November, US plane maker Boeing announced that Jet Airways had agreed to an $8 billion deal to buy 75 Boeing 737 aircraft.

Jet Airways, part owned by Etihad Airways, will start taking delivery of the planes from mid-2018.

The purchases are in line with Boeing’s forecast released in August that it expects demand for 1,740 planes in India over the next 20 years, at an estimated price of $240 billion.

Most of these planes will be for fleet expansion and the rest to replace older aircraft.

The industry’s rapid growth is helping the millions of Indians who need to travel long distances to their country’s far northeast or deep south.

Budget airline Indigo was the first private carrier to fly to the northeast, starting flights in 2006 to an area that was otherwise an epic train and bus journey.

“More and more airlines have started flights to my home town. Also, the competition between airlines means tickets are getting cheaper,” said Ngashangva.

Aviation experts say that in the past, socialist-leaning politicians viewed traveling by plane as a luxury and not as an enabler of business and economic growth.

The luxury tag ensured punitive taxes on jet fuel, making it nearly 60 percent more expensive than in Singapore or Dubai, both home to busy international airports.

Despite such hurdles, India is forecast to become the third largest aviation market by 2020. Domestic air passengers are expected to jump from the current 70 million to 300 million by 2022, and to 500 million by 2027.

In an attempt to minimize the industry’s growing pains, the government in October announced a draft aviation policy.


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