With its consistent double-digit growth, the Indian civil aviation industry has ushered in a new era of expansion for the allied services related to aviation besides airlines, airports, i.e., air cargo, MRO, catering, online travel agency, travel portals, etc. As per ICAO study Economic benefits of civil aviation: ripples of prosperity every Rs 100 spent on air transport contributes to Rs 325 worth benefits, and every 100 direct jobs in air transport result in 610 jobs in the economy. The MRO services is estimated to be $2 billion by 2020. Empirical data shows that for every $1 million in revenue in the MRO sector, it has the potential to create 50 direct jobs. The international and domestic freight traffic has shown growth of 7.7 per cent in total freight traffic during the period April-September 2016-17.
The session-propelling growth through aviation-led services-established an integrate eco-system, which will lead to significant growth of services in the civil sector, which in turn, would accelerate economic growth and employment.
In his opening remarks, K Nandakumar, Member CII Western Regional Council and Chairman & Managing Director, Chemtrols Industries, said, Today, the civil aviation industry has been driven by low cost carriers, modern airports, FDI, advanced IT and growing regional connectivity. He added: It is now the fastest growing industry and inching towards becoming the 3rd largest aviation market by 2027.
As he set the tone for the panel session, Jayant Sinha, Minister of State for Civil Aviation, deliberated on following farm-to-frontier model, than farm-to-manufacturing model if India needs to leapfrog from current level of 200 million trips per annum to 1 billion trips.
He cited examples of the USA and China where the former does 900 million trips per annum, whereas latter does 600 million despite having highest rail network in place. If China and USA can, why not India, then, he proclaimed.
The Ministry of Civil Aviation is expecting a 10-12 per cent growth per annum in trips that includes domestic and international put together. It is absolutely achievable target, he said adding huge opportunities exists in aerospace manufacturing. Sinha said aviation was going to be one of the largest industries in India and airlines had placed orders for over 900 planes.
He added, ‘Even as we focus on the champion sectors, aviation stands tall amongst them and is one of the most interesting sectors.’ Interestingly, as per Sinhas observation, the size of the aviation industry is as equivalent to what Indian telecom industry is which is around Rs 1 trillion.
Going forward he said, the government is expecting around Rs 10 trillion investment in the Indian aerospace industry.
Sinha outlined four challenges that needs immediate attention from the government. First, to build sufficient airport capacity that will help reaching one billion target. According to him, there is need to manage Indian air space and for that Indian aviation sector requires advanced system with national control centre to manage air traffic efficiently and avoid congestion in Indian air space. Also, Sinha avers that there is dire need to strengthen regulatory institutions that will help the sector to be more disciplined and regulated. Lastly, he expressed his concern over need of skilled manpower as these challenges can be mitigated once Indian aviation sector have skilled manpower.
Meanwhile, the minister announced that his Ministry is in final stages of formulating the drone policy and it is expected to be released shortly.
The Ministry came out with draft rules for unmanned aircraft systems last year, seeking comments from the public. The Minister of State for Civil aviation said that certain issues related to security and global standards were discussed in detail with the concerned stakeholders. We have finalised our work on the drone policy… Some tricky issues need to be resolved from security and global standards. We are now at the end of that consultation process. So our hope is that very shortly we will have the final drone policy coming out, he said.
Talking about the prospects of the aviation sector, Sinha said it holds huge potential to push the countrys economic growth. He said the government is working on several areas including building airport capacity, strengthen regulatory institutions and enhancing skills required in the sector.
During his address, Anup Wadhawan, Special Secretary, Department of Commerce, Ministry of Commerce & Industries, Government of India, avers, With the government carving a pragmatic vision, aviation industry needs balance with conducive environment.
Echoing the views of minister, S Machendranathan, Chairperson, AERA, an aviation regulated body said that India needs improve the capital addition of airports and possess huge opportunities with greenfield airports planned in cities like Delhi, Mumbai and brownfield opportunities in Bengaluru.
Further, Dr Guruprasad Mohapatra, Chairman, AAI, outlined the plans for capacity addition for the aviation sector. The government, with the help of public-private partnership (PPP) has envisaged Rs 1 trillion spending plan in the next five years on greenfield and brownfield airport of which, AAI has committed for Rs 220 billion. Mohapatra didnt forget to add how private sector can look for new avenue in maintenance and operations space which have huge opportunities now. We are planning to give some of the airports to private players for O&M purpose, which will take off burden from our shoulder and allow us to focus on airport development plans planned by the government.
Meanwhile, Bharat Malkani, Promoter, Max Aerospace, was vocal about how India lacks in building its MRO capabilities despite having pool of talent.
About 95 per cent of MRO is imported, and with this, we have handed over 50,000 direct jobs to foreign players, he said. He opined that Indian aviation players must give some benefits to local industry, which is exact opposite in MRO.
During the session, Tulsi Mirchandaney, Managing Director, Blue Dart Aviation, expressed her concerns on insufficient transit base, parking base, traffic congestion and arbitrary impediments. These challenges are having cascading effects on the air cargo sector, she said.
On his concluding note, Sanjiv Edward, COO, Delhi International Airport, reminded the audience that how aviation sector is uplifting the regional as well as countrys economy citing Delhi as an example. The total economic impact on Delhi was Rs 800 billion creating 2.5 billion jobs.
According to him, to stand tall in the global aero arena, the key elements is operational excellence and managing the timely performance.