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Airline Industry in India - Essay Example

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Summary
The history of the civil aviation industry in India can be traced back to the year 1912 when the first air flight between Karachi and Delhi was started by the Indian State Air Services in collaboration with the UK based Imperial Airways. The Government of India nationalized nine airline companies vide the Air Corporations Act, 1953.
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Airline Industry in India

Download file to see previous pages... This Act ensured that IAC and AI had a monopoly over the Indian skies.
This trend will be driven by the economic expansion India, according to IATA. The organization also said that cargo volume, which follows the trends in world trade, is also likely to see a 6% annual increase in 2004-2008.The forecasts were released as a part of IATA's year-end outlook, Reuters reported.
IATA also predicted that India will be the world's second fastest growing market for air travel after China. According to the organization India is likely to lead the global economic expansion for the foreseeable future and this will create long-haul business traffic to and from North America, while the growth in air travel between North America and India is expected to exceed 10%. Three former Soviet Bloc countries will also be among the five fastest growing passenger markets during the period, with Poland at 5% Hungary at 9.6% and the Czech Republic at 9.1%, which is just behind United Arab Emirates at 9.3%. The UAE is fourth on IATA's forecast list of the fastest growing passenger markets.
While the Indian airline industry is viewed as immature, it has incredible growth potential. In fact, observers say it will boast a growth rate among the highest in the world, and will eventually have the largest domestic market outside the U.S. and China.
All four of the major Indian airlines are believed to ...
In fact, observers say it will boast a growth rate among the highest in the world, and will eventually have the largest domestic market outside the U.S. and China.
All four of the major Indian airlines are believed to be discussing aircraft acquisitions with manufacturers. The planned partial privatization of government-owned airlines is expected to provide greater impetus to future growth, Ian Thomas of the Center for Asia Pacific Aviation (CAPA) told World Airline News, but will also delay immediate purchasing plans.
Airbus Industry recently gave a presentation in Delhi and Mumbai at which it presented its demand predictions for the Indian market. Airbus research indicates that the major Indian carriers will have to buy 222 airliners with 100 seats or more worth about US$7.5 billion in the next 20 years, and that fleet sizes will more than double from 112 aircraft at the end of 1999 to 236 by 2019.
Scope for Airline Industry Expansion in India
India's civil aviation industry will need to purchase 490 aircraft over the next 20 years, according Dinesh Keskar, vice-president for sales at Boeing.
According to estimates from the aircraft manufacturer, falling ticket prices and an increase in passenger traffic will cause an increase in the demand for aircraft. Keskar told Reuters that the passenger traffic in India is likely to increase by 20% over the next three to four years.
The Indian authorities have reportedly said that the domestic and international air traffic will increase by about 20% annually, due to investments from the government and private sector. The investments have been estimated at USD20bn over the next five years and the increase of aircraft numbers is expected to double the number of civilian ...Download file to see next pagesRead More
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