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IndianAviationIndustry
Latestupdate:November,2015

AVIATION

HealthyGrowthofPassengerTraffic
Totalpassengertrafficstoodata106.45millioninFY2016*.
Passengertrafficincreasedby12.47percentinFY2015.

EXPLOREOTHERINDUSTRIES

Growthinpassengertraffichasbeenstrongsincethenew

AVIATION

millennium,especiallywithrisingincomesandlowcostaviation
passengertrafficexpandedataCAGRof3.8percentoverFY

Indiaisexpectedto
becomethethirdlargest
aviationmarketby2020
andisexpectedtobethe
largestby2030.

200616*.

Industry

SNAPSHOT

BROWSE:

SHOWCASE

PRESENTATION

LastUpdated:November,2015

AGRICULTURE
AUTOMOBILES

SECTORALREPORT|JANUARY,2016

AUTOCOMPONENTS
AVIATION

Introduction

BANKING

Indiascivilaviationindustryisonahighgrowthtrajectory.Indiaaimstobecomethethirdlargestaviationmarketby
2020andthelargestby2030.

BIOTECHNOLOGY
CEMENT
CONSUMERMARKETS

TheCivilAviationindustryhasusheredinaneweraofexpansion,drivenbyfactorssuchaslowcostcarriers
(LCCs),modernairports,ForeignDirectInvestment(FDI)indomesticairlines,advancedinformationtechnology(IT)
interventionsandgrowingemphasisonregionalconnectivity.Indiaistheninthlargestcivilaviationmarketinthe
world,withamarketsizeofaroundUS$16billion.

EDUCATIONANDTRAINING
ENGINEERING
FINANCIALSERVICES
FOODINDUSTRY

TheworldisfocusedonIndianaviationfrommanufacturers,tourismboards,airlinesandglobalbusinessesto
individualtravellers,shippersandbusinessmen.IfwecanfindcommonpurposeamongallstakeholdersinIndian
aviation,abrightfutureisathand,saidMr.TonyTyler,DirectorGeneralandCEO,InternationalAirTransport
Association(IATA).

GEMSANDJEWELLERY
HEALTHCARE
INFRASTRUCTURE
INSURANCE
IT&ITES

MarketSize

MANUFACTURING
MEDIAANDENTERTAINMENT
OILANDGAS
PHARMACEUTICALS
REALESTATE
RESEARCHANDDEVELOPMENT
RETAIL
SCIENCEANDTECHNOLOGY
SEMICONDUCTOR

IntheJulySeptemberquarterof2015,domesticairpassengertrafficsurged21.5percentto20.12millionfrom16.57
millioninthecorrespondingperiodayearago.TotalpassengerscarriedinSeptember2015increased13.24percent
YoYto8.73millionfrom7.71millioninSeptember2014.Internationalanddomesticpassengertrafficgrew6.6per
centand15.5percent,respectively,inSeptember2015.
InSeptember2015,totalaircraftmovementsatallIndianairportsstoodat145,628,whichwas10.2percenthigher
thanSeptember2014.Internationalanddomesticaircraftmovementsincreased7.5percentand11percent,
respectively,inSeptember2015.
Overthenextfiveyears,domesticandinternationalpassengertrafficareexpectedtoincreaseatanannualaverage
rateof12percentand8percent,respectively,whiledomesticandinternationalcargoareestimatedtoriseatan
averageannualrateof12percentand10percent,respectively.

RELATED NEWS

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TheairlinesoperatinginIndiaareprojectedtorecordacollectiveoperatingprofitofRs8,100crore(US$1.29billion)
infiscalyear2016,accordingtoCrisilLtd.

LastUpdated:February09,2016

Investment

India,USsignagreementtoimprovesystems
atDGCA

AccordingtodatareleasedbytheDepartmentofIndustrialPolicyandPromotion(DIPP),FDIinflowsinairtransport
(includingairfreight)betweenApril2000andJune2015stoodatUS$573.12million.

'BoeingwillinvestbillionsofdollarsinIndia'
AAIplanstodevelopinfrastructureatregional
airports
SigningofMoUbetweenIndiaandSingaporein
thefieldofCivilAviation

KeyinvestmentsanddevelopmentsinIndiasaviationindustryinclude:
TheMinistryofCivilAviationhassignedMemorandumofUnderstanding(MoU)withFinland,Kazakhstan,Kenya,
Sweden,Norway,Denmark,OmanandEthiopiaforincreasedcooperationbetweenthecountriesintermsof
additionalseats,sharingofairlinescodes,increasedfrequenciesandadditionalpointsofcall,duringthe
InternationalCivilAviationNegotiations(ICAN),2015heldinAntalya,Turkey.

India,SEAsiaairlinestoseeimproved
earnings:Fitch

GETNEWSALERTS

TataAdvancedSystems(TASL)hassignedajointventurewithAmericanaircraftmanufacturingmajor,Boeing,
toestablishacentreofexcellenceformanufacturingaerostructuresforApachehelicopterinitiallyandcollaborate
onintegratedsystemsdevelopmentopportunitiesinIndiainthelongterm.
USbasedaircraftmanufacturerBoeingplanstoassembleoneofitstwohelicoptersnamely,Chinook(heavylift)
orApache(attacktype)inIndia,thusbecomingyetanotherglobalcompanytoinvestinIndiaencouragedbythe
MakeinIndiacampaign.

IndiaisverymuchonAirbusmap
foralltheimportantworkthatwedo
globallyanditisnotjustfromthe
marketperspective
SrinivasanDwarkanath
ManagingDirector,AirbusIndia

AirbusSAS,oneofthetoptwoaircraftmanufacturersintheworld,planstoopenaircraftmaintenanceandrepair
overhaul(MRO)facilityinIndia.
Airbus,theworldsleadingaircraftmaker,expectsIndiasaviationindustrytogrowatover10percentannuallyin
thenextdecade,almostdoubletheaveragegrowthrateoftheglobalaviationindustry.
EyeinglargeordersfromIndianairlines,AirbushascommittedtosourceproductsworthUS$2billion
cumulativelyoverthenextfiveyearsfromIndiathecompanyplanstoprovidecustomisedmaintenanceand
otherservicesclosertothebaseforallitsairlinecustomersinIndia.
FrenchdronemakerLHAviationsignedaMemorandumofUnderstanding(MoU)withIndiasOISAdvanced
TechnologiesonJune19,2015tomanufacturetacticaldronesinIndiathroughanindustriallicense.
MahindraGroupexpandeditspartnershipwithGEAviationbysigninganagreementtomanufactureaero
structuresattheGroupsnewaerospacefacilityinBengaluru.
IndiGoplanstofiledocumentsforaninitialpublicofferingwithinthenexttwomonthstoraiseUS$400millionby
selling10percentstake.
SpiceJetplanstoenteradealwithBoeingCo.andAirbusGroupSEtobuy80120jetairplaneswhichwouldhelp
toexpandtheirfleetandrebuilditsbusiness.

GovernmentInitiatives
Governmentagenciesprojectthataround500brownfieldandgreenfieldairportswouldberequiredby2020.The
privatesectorisbeingencouragedtobecomeactivelyinvolvedintheconstructionofairportsthroughdifferentPublic
PrivatePartnershipmodels,withsubstantialstatesupportintermsoffinancing,concessionallandallotment,tax
holidaysandotherincentives.
Somemajorinitiativesundertakenbythegovernmentare:
TheAirportsAuthorityofIndia(AAI)planstoreviveandoperationalisearound50airportsinIndiaoverthenext10
yearstoimproveregionalandremoteairconnectivity.
TheGovernmentofIndia,initsdraftcivilaviationpolicyreleasedforinputsfromstakeholders,hasproposed
raisingForeignDirectInvestment(FDI)limitindomesticairlinesfromthecurrent49percenttoover50percent,
alongwithotherreformssuchastaxincentivesforairlines,incentivesfortravellerstoflytosmalltownsat
affordablerates,andeasingthenormsfordomesticcarrierstooperateabroad.
GujaratisexpectedtogetasecondinternationalairportatDholera.ThestategovernmenthasformedDholera
InternationalAirportCo.Ltd.andisobtainingapprovalsfromtheuniongovernment.
TheDirectorateGeneralofCivilAviation(DGCA)hasgivenitsapprovaltoAirIndiasmaintenance,repairand
overhaul(MRO)unit.
TheGovernmentofIndiahasdecidedtoawardairportsinKolkata,Chennai,JaipurandAhmedabadon
managementcontract.AAIhasissuedtheRequestforQualificationdocumentforthesefourairports.
TheGovernmentofIndiaplanstoformacommitteecomprisingbankers,aviationexpertsandtechnocratstohelp
turnaroundandprivatisethenationalairline,AirIndia.
TheGovernmentofIndiaapprovedaproposaltosetupasecondairportintheNationalCapitalRegion.
TheGovernmentofIndiaexpectstofinalisethenewaviationpolicyandrevisedinternationalflyingnormsfor
domesticcarrierssoonthegovernmentmayremovethe5/20normsfordomesticairlinesinthisnewpolicy.

RoadAhead
Indiasaviationindustryislargelyuntappedwithhugegrowthopportunities,consideringthatairtransportisstill
expensiveformajorityofthecountryspopulation,ofwhichnearly40percentistheupwardlymobilemiddleclass.
Theindustrystakeholdersshouldengageandcollaboratewithpolicymakerstoimplementefficientandrational
decisionsthatwouldboostIndiascivilaviationindustry.Withtherightpoliciesandrelentlessfocusonquality,cost
andpassengerinterest,Indiawouldbewellplacedtoachieveitsvisionofbecomingthethirdlargestaviationmarket
by2020andthelargestby2030.
ExchangeRateUsed:INR1=US$0.0151asonNovember15,2015
References:MediaReports,PressReleases,PressInformationBureau,DirectorateGeneralofCivilAviation
(DGCA),AirportsAuthorityofIndia(AAI)
Disclaimer:ThisinformationhasbeencollectedthroughsecondaryresearchandIBEFisnotresponsibleforanyerrorsinthesame.

AVIATION INDIA
MAJORAIRPORTS

POSTERS
INDUSTRYCONTACTS

AirportsAuthorityofIndia(AAI)
DirectorateGeneralofCivilAviation
(DGCA)

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