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2016 laid foundation for high growth in aviation sector

2016 laid foundation for high growth in aviation sector

NEW DELHI, Jan 1: The year 2016 will be remembered as a historic one which has provided a foundation for the high growth for domestic passengers and airlines through announcement of National Civil Aviation Policy (NCAP) and Regional Connectivity Scheme (RCS).

Through NCAP, government addressed the bigger issue of domestic fliers by paving way to connect smaller cities by making airports at tier two and three cities operational in near future.

The NCAP announce in the mid of the year 2016 with an emphasis on connecting regional destinations.

Industry, aviation experts believes that the policy could be a foundation for the further and fast growth in the year 2017.

In the year 2016, the growth rate in the Indian Aviation sector was highest in the world as it grew by more than 23 per cent in terms of passengers.

Based on the preparations and activities in the year 2016, it is said that 2017 will also be an action-packed for domestic flyers right from the start.

The Government’s scheme for the domestic sector UDAN (Udey Desh Ka Aam Nagrik ) has started showing its result as flights are going to start from smaller towns. It is believed that Government will help to make more than 100 airports operational which are not in operation as on date inspite of having airstrips and most of the facilities.

Under the ambitious UDAN scheme, Government has announced to provide all the support and facilities to the state governments and Airlines willing to start operation from under served airports to served airports if the concerned state and Airlines want to start flights from the said airport of the state with some conditions.

Government too announced financial supports in various terms to help those airports and airlines aiming to enhance regional air connectivity through fiscal support and infrastructure development.

The Centre and States have come forward to provide subsidies to those operators who are willing to offer an one-hour flight between Tier II and Tier III cities at Rs 2,500. Maharashtra, Gujarat, Puducherry, Andhra Pradesh, Madhya Pradesh and Uttrakhand are among the 11 States and Union Territories that have signed up for UDAN.

The NCAP envisages a roadmap to support 300 million air travellers in five years and steps to make flying affordable and convenient. The policy dwells on upgrade of airports, regional connectivity, easing of norms for flying abroad, liberalisation of the open skies regime, development of cargo hubs, chopper services, attracting investments in maintenance and ground-handling and security.

During the year the ambitious policy did away with one of the most contentious rules of the sector known as ‘5/20′, five-years operation and a 20-aircraft fleet, to qualify for flying abroad. The five-year wait was done away with, but airlines will need 20 aircraft or fly 20 per cent of their capacity on domestic routes.

In the year 2017 all this will pave the way of entry of new players in the aviation sector. New operators are expected to induct such aircraft in their fleet for starting operations. It is believed that upto 10 new regional airlines could take to the skies in 2017.

However, the focus is not going to be only on the smaller cities. Flyers in the bigger cities will not be left out of the action as several airlines are set to take delivery of brand new aircraft. Most of the airlines are adding capacities on the existing routes too.

Airlines like Air India and Jet Airways will look to operate dedicated wide-body aircraft on domestic routes. It will offer a different level of comfort for domestic travellers.

The growth can be judged from the data released by the Ministry also. According to the latest data from the Directorate General of Civil Aviation (DGCA), passenger traffic during January-November 2016 zoomed by 23.10 per cent to 90.36 million.

As per Minister of State for Civil Aviation Jayant Sinha, India has only 150 million passenger trips a year as compared to China’s 450 million and the US’ 800 million which provides a huge scope of growth in Indian domestic aviation sector.

Among other highlights of 2016, the government has initiated a trial run for “non-stamping” of passengers’ baggage tags at the time of boarding the aircraft at six airports to facilitate hassle-free movement of passengers with hand baggage.

In other major developments, the government appointed B S Bhullar as chief of the country’s civil aviation regulator, DGCA.

According to International Air Transport Association (IATA), India’s air traffic grew at a significantly higher rate even in October when air traffic growth moderated in other countries such as China (14.1 per cent), Brazil (-5.5 per cent), Russia (2.5 per cent) and Japan (0.8 per cent).

A dip in aviation turbine fuel prices by eight per cent also helped the aviation sector as the cost came down and tickets became cheaper by 14 per cent which allowed the airlines to start the fare war.



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