People 01.02.2017 Indian Aviation industry The civil as well as military aviation industry in India has emerged subsequently in last three years as a result of which India is currently third largest domestic civil aviation market in the world, it can overtake UK to become third largest air passenger market by 2024.Considering the market size, the passenger traffic grew at 16.52 per cent per year and reached 308.75 million in FY18. From FY06-FY18 it has grown at a CAGR of 12.72 per cent. During the period of 2018-19 domestic and international aircraft movements of India grew by 7.93% YOY and 6.36% YOY. In FY19, passenger traffic in India stood at 344.70 million of which domestic passenger traffic accounted 275.22 million while international traffic stood at 69.48 million. The aviation sector in India contributes $72 billion to GDP. This huge industry employs over 8 million people in India. Government of India has been working to increase number of airports in order to cater to rapidly rising air traffic. India has 103 operational airports including greenfield ones as of Feb 2019 under RCS-UDAN scheme. It is envisaged that the number of operational airports will increase to 190-200 by FY40. And as the number of aeroplanes is expected to grow by 2027 which are currently nearly 620 operational aircraft. In June 2018, India has signed an open sky agreement with Australia allowing airlines on either side to offer unlimited seats to six Indian metro cities and various Australian cities. Airport Authority of India (AAI) will spend $3 billion on non-metro projects over 2016-20 on order to focus on airport modernization. And there had been $3 billion investments in greenfield airports – Navi Mumbai and Goa by Private Public partnerships (PPP), these airports are situated in Ahmedabad, Jaipur, Lucknow, Guwahati, Thiruvananthapuram and Mangaluru. The Government of Andhra Pradesh is to develop Greenfield airports in six cities-Nizamabad, Nellore, Kurnool, Ramagundam, Tadepalligudem and Kothagudem under the PPP model. India’s aviation industry is expected to witness Rs. 35000 Crores (USD $4.99 billion) investment in upcoming four years. The Indian government is planning to invest in airport infrastructure along with aviation navigation services. The AAI plans to develop Guwahati as an inter-regional hub and Agartala, Imphal and Dibrugarh as intra-regional hubs. Government is taking various initiatives as, in January 2019, the Government of India was working on a blueprint to promote domestic manufacturing of aircraft and aircraft financing within the country. In January 2019, the government organised the Global Aviation Summit in Mumbai which witnessed participation of over 1,200 delegates from 83 countries. In January 2019, the Government of India’s released the National Air Cargo Policy Outline 2019 which envisages making Indian air cargo and logistics the most efficient, seamless and cost and time effective globally by the end of the next decade. In February 2018, the Prime Minister of India launched the construction of Navi Mumbai airport which is expected to be built at a cost of US$ 2.58 billion. The first phase of the airport will be completed by the end of 2019.Indian aviation industry’s achievements areas:In September 2018, Jharsuguda Airport in Odisha and Pakyong Airport in Sikkim were inaugurated. Pakyong airport is Sikkim’s first-ever airport and AAI’s first Greenfield airport construction.In December 2018, Kannur International Airport was inaugurated making Kerala the only state in India to have four international airports.CONTROVERSIES:GoAir has grounded at least 10 of its 48 planes for want of a network to fly them. More than 15 top executives have quit the airline in the last few months. Almost every top position in the airline, including that of the CEO, is empty. Recent suspension of operations by Jet Airways NSE -4.81 %, once India’s biggest airline by passengers and for many years the second largest. IndiGo, the country’s biggest airline, and its rival low-fare carrier SpiceJet NSE 5.67 % have both ordered aircraft that have been facing severe technical glitches. The Pratt & Whitney (P&W) geared turbofan engines that power IndiGo’s Airbus A320neo (new engine option) planes have developed constant issues since they were pressed into services, leading to several groundings last year and this year. Recent Policies:AAI STARTUP POLICY: To Create a culture of innovation at Airports Authority of India (AAI) by harnessing internal and external sources for ‘best in class’ passenger experience, operational efficiency, profitability and sustainability of AAI managed Airports. DIGI YATRA POLICY: Every passenger, (Indian citizens and foreigners) become a “Digi Yatri” and enjoys the privileges and benefits of the “Digi Yatra” Program of hassle-free, cashless experience etc.NATIONAL AVIATION SAFETY PLAN 2018-22: Policy of effective risk controls.Analysis:Aviation industry can grow immensely as India has very suitable weather conditions almost all the time. The Government is taking different measures for helping the growth of the industry, so that the industry may play its part in the complete development which India is planning for its people. India’s aviation industry is largely untapped with huge growth opportunities, considering that air transport is still expensive for the majority of the country’s population, of which nearly 40 per cent is the upwardly mobile middle class. With the right policies and relentless focus on quality, cost and passenger interest, India would be well placed to achieve its vision of becoming the third-largest aviation market by 2020 for which stakeholders have to collaborate with policymakers in order to boost the market efficiently. The rising number of aircraft and airports both points towards a risk also, of irresponsibility, mistaken or ill-attended UAS (Unnamed Aircraft Systems) in India. Santosh Hiredesai of SBI Capital Markets summed up the situation in a recent note, characterising FY19 as a “year of sharp U-turns” for India’s aviation industry — from record profit in FY18 to mega losses, resulting in dire need of recapitalisation. CAPA Centre for Aviation, a Sydney-based consultant, estimates the current number of pilots in India at 7,963. In 10 years, airlines will have to hire 17,164 more. The projected growth in capacity, because of plane orders, will lead to a 14% shortfall in commander pilots, a part of which will have to be fulfilled by more expensive expatriates, leading to a rise in the wage bill, the second biggest cost chunk after fuel.