By Sushma Ramachandran
New Delhi. The civil aviation industry has made a robust rebound from the depressed Covid pandemic era. Passenger traffic by the end of 2022 crossed pre-pandemic levels and is estimated at over 400,000 daily. In fact, the headline news during last December and January has been about airport congestion and the inability to manage large crowds waiting for their flights. This is a far cry from 2020 and 2021 when the aviation industry went through a prolonged slump owing to widespread fears of the general public about getting the virus while travelling by air.
The surge in air travel is being described as a V shaped recovery. Consequently, forecasts are being made that the country’s total annual passenger traffic will touch 480 million by 2036, crossing the combined traffic of Japan and Germany.
The industry is not quite out of the woods, however, as it has come into the news recently owing to badly behaved passengers and the inability of cabin crew to handle difficult situations. Safety issues have also come to fore with some instances of emergency doors being opened mistakenly – or idiotically – by passengers. Clearly, the airlines need to focus now on management of passengers and safety guidelines within the aircraft apart from simply trying to be competitive over on-time performance. This is all the more important as passenger traffic is expanding to smaller towns and cities bringing air travel to those who used to move only rail or road earlier.
Airlines therefore need to do undertake some amount of passenger education probably in collaboration with associations set up to protect the interests of air travellers.
Budget Highlights Aviation
The budget proposals for 2023-24 have also highlighted the growing need for infrastructure to handle the expansion of air traffic capacity although the allocation for the Civil Aviation Ministry has substantially been reduced to Rs. 3113 crore from Rs. 10,667 crore in the previous year. But the cut is largely due to the absence of any funding for the erstwhile government-owned Air India.
Finance Minister Nirmala Sitharaman has, however, announced the revival of 50 additional airports, heliports, water aerodromes and advance landing grounds to improve regional air connectivity.
Airports
Currently there are 120 airports in the country and the Civil Aviation Ministry plans to raise the numbers to 220 by 2025. It is also proposed to set up 33 new domestic cargo terminals and 15 new flight training schools. As far as revival of old airports is concerned, the project began about five years ago with the aim of improving regional connectivity.
Many airports and airstrips were of World War 2 vintage but could become functional with some investment. It was these that were identified for this programme. About two years ago , the Civil Aviation Ministry declared a target of operationalising 100 unserved and under -served airports. At the time, only 75 of 450 runways were reportedly functional. Now, as many as 38 more airports have been added to the country’s aviation map.
The revival of airports programme is closely linked to the Udan scheme for bringing air travel to smaller towns and cities so that the masses rather than just the elite in big metros can have the advantage of travelling by air. According to data available with the Civil Aviation Ministry, about 10.6 million passengers have travelled by air under the Udey Desh ka Aam Naagarik (UDAN) scheme, which completed six years of operation in October 2022.
The scheme has proved to be controversial and has been deemed equally a success and a failure. The fact is it has brought air travel to many tier 2 and tier 3 cities and made it accessible to a category of citizens who did not have access to this transport facility till now. At the same time , it has not achieved all the original objectives in terms of ensuring that the flights are profitable while the number of destinations is much less than was envisaged initially. Some airlines which were expected to be the mainstay of the programme like Deccan Charters actually closed down and their routes had to be reallocated.
The pricing was also not lucrative enough for the airlines which had to sell some seats at lower prices sometimes though a subsidy scheme has been evolved for this purpose.
Despite these infirmities, there is no doubt that a dent has been made in terms of reaching out both to small metros as well as to remote and hilly areas which have faced serious problems regarding transport connectivity. Some routes have turned out to be popular and lucrative while others have had very few passengers, making them unprofitable for the airlines.
Udan has the Potential
Clearly, the government has recognised the value of the Udan scheme even if its potential has not been fully realised, since it has brought the revival of airports into the budgetary plans for enhancing investment in infrastructure in 2023-24.
The aviation industry is also heading for self reliance in manufacture of aero-engines, in initiatives taken as part of the Make in India programme. US aircraft engine producer, GE Aerospace has extended its manufacturing agreement with Tata Advanced Systems limited (TASL) for aircraft engine components under a multi-year contract valued at one billion dollars. Reports say that parts for LEAP engines which power the Airbus A320neo and soon even the Boeing 737 Max will now be made at a larger scale at the Tata Centre of Excellence for Aero Engines in Hyderabad and shipped to GEs global engine manufacturing factories.
Outlook for Domestic Carriers
As for the outlook for domestic carriers, it seems there is some churning going on as the entire scenario has changed after Air India has been sold to Tata Sons. The Tata group airlines are being restructured as Air Asia will be merged with Air India Express while Vistara which has a 49 per cent shareholding of Singapore Airlines, will be merged with Air India. The combined budget carrier of Air India Express and Air Asia could end up becoming a serious challenger to the biggest player in this sector, Indigo, which has the largest fleet in India with 300 Airbus aircraft.
Jet Airways was also expected to enter the skies but has run into unexpected problems and its entry into the market has now become uncertain.
Nonetheless, the civil aviation sector is set for major expansion as airlines will be gearing up to meet the demands of growing passenger traffic, both on domestic and international routes. Indians have returned to the skies with a vengeance after Covid and are travelling both for business and pleasure in a big way.
The travel for recreation is being called revenge tourism but more realistically, it is a return to normalcy. Given the forecasts for the near and medium term, it looks as if the aviation industry will be going through a phase of resurgence and revival in the coming year.
