India could be a market of over 4 billion passengers in near future : DG and CEO, IATA

NEW DELHI - There is tremendous potential for Indian aviation to grow, currently 42 million annual passengers fly domestically and 34 million internationally.

“If Indians flew as much as Americans, it would be a market of over 4 billion passengers. With the spending power of Indians set to triple over the next two years, the potential for growth is incredible,” said Giovanni Bisignani, Director General and CEO of the International Air Transport Association (IATA) at an Interactive meeting on “Challenges of Indian Aviation” organized by Confederation of Indian industry (CII) today.

India has to have a more coordinated cross-ministry government approach in shoring-up the gains in India’s aviation industry.

But there is still much more to be done. It’s time to take care of structural weaknesses and go for a comprehensive approach with a common vision by all involved,” said Giovanni

Key areas requiring special attention to improve the Aviation market are safety, infrastructure, liberalization, policy coordination, security and environment.

The success of India’s airlines should not be compromised by an archaic investment policy that isolates them from global trends,” said Bisignani noting recent trends of consolidation, multi-hub and multi-brand strategies. . India allows 100% FDI in transit systems, ports, harbors, hotels, ocean transport and road systems. But airline FDI is restricted to 49%. Moreover, no foreign airline can invest in an Indian airline.

To build competitiveness, it is critical that the costs of operating in India are reduced. “It is an embarrassing situation for such a relevant country as India-which is a member of the ICAO Council-to be ignoring rules that it has helped to develop,” said Bisignani.

The air transport industry has committed to improve fuel efficiency by 1.5 percent per year to 2020, cap net emissions from 2020 with carbon-neutral growth and cut net emissions in half by 2050 compared to 2005.

“IATA continues to expand our India operations….this could be the decade when Indian aviation will reach its potential. But there are no guarantees for success without continued hard work, change and a common vision for success shared across government and with the industry. India has come a long way in addressing the challenges of growth. The foundations for success are half-laid and IATA will continue its support to help finish the job,” added Bisignani.

Dr Vijay Mallya, Chairman, CII National Committee on Civil Aviation and Chairman and MD of Kingfisher airlines Ltd said that, the Indian aviation industry will see a new high and India has the potential to emerge as an aviation hub. But a supportive, conducive environment is required. The few challenges faced by the industry include high cost of aviation, restricted FDI policy among others.

Ankur Bhatia, Executive Director, Bird Group also reiterated that the regulations prevalent in this industry prevent airlines from maximizing operative and business efficiencies. (ANI)