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Road to India@100: Vision for 2047 is that everyone must fly

Road to India@100: Vision for 2047 is that everyone must fly

While many sectors have grown by leaps and bounds, a measly 4 per cent of Indians travel by air. So, what ails the world's fastest-growing aviation market?

G.R. Gopinath, Founder of Air Deccan G.R. Gopinath, Founder of Air Deccan

The reforms that opened up the aviation sector in 1991 and ended the monopoly of Indian Airlines and Air India changed the sector when a slew of private sector airlines were given the licence to fly. Again, when the low-cost airlines took wings in 2003 they broke the cost barrier by penetrating deep into the rural hinterland.

Sadly, while all sectors have grown by leaps and bounds, Indian aviation has become ‘the sick man of India’. Thanks to choking regulations, tough entry barriers for new entrants, high fuel prices abetted by high taxes, inefficient public sector airports paving the way for monopoly airports that are extortionist in the absence of robust competition and the lack of a long-term strategic policy, growth of aviation has again slumped. Multiple airports serve cities like New York, London, Paris and Washington DC. We need privatisation but not cartelisation. Airports must compete like airlines to keep prices under check and improve the quality of service. The HAL airport in Bengaluru and the old government airport in Hyderabad should never have been closed when new airports were allowed, to ensure competition. This must be borne in mind for the future.

Our bilateral and open sky policies need to be rethought boldly so that major metro airports can become mega transportation hubs like Dubai, Singapore and London. Our existing airports shouldn’t be shy of competition.

The number of Indians who buy air tickets in a year is 140 million, which is a pre-Covid-19 figure. However, they are not 140 million different individuals. That number comprises repeat flyers of 35-40 million who form the bulk of the ticket buyers. Thus, the number translates to less than 4 per cent of the population who can afford air travel, placing India in terms of per capita consumption of air tickets alongside some poor African countries. Brazil, Malaysia, Indonesia and China are way ahead of India.

While on my way to the US for an aviation conference in 2002, at Luton airport—one of the five international airports serving the London Metropolitan area—I saw an advertisement that screamed the airport had flown 13 million passengers per annum. That hit me like lightning. All 40 airports in India flew as much then. On a flight of Southwest Airlines to Phoenix in the US, a heavily tattooed burly man in shorts and a vest sat next to me with his family at the back. I learnt he was a carpenter visiting Grand Canyon. That was my moment of epiphany. I did not have to be a rocket scientist or seek McKinsey’s validation. I decided India was ready and launched a low-cost airline on a wing and prayer. It was a crazy idea but the atmosphere was conducive under the National Democratic Alliance (NDA) government led by Atal Bihari Vajpayee. Entrepreneurs break the status quo, smash cartels and create new markets.

The ‘Startup India’ campaign is a laudable initiative by Prime Minister Narendra Modi but is largely restricted to technology companies. It must spread to other areas as well. Aviation is integral to equitable economic growth to be globally competitive and to harness large swathes of India struggling with poverty and unemployment. Passenger airlines and air cargo subsume geography and knit remote areas together, allowing access to markets and boosting tourism, which is the largest employment generator in the unorganised sector.

With mega airports controlling air and ground space it’s well-nigh impossible to connect rural small regional towns with large metros stunting regional connectivity despite the commendable UDAN-RCS initiative. And where slots are available, costs are prohibitive.

Our air cargo growth is languishing and is almost zero. Hong Kong airport alone handles more cargo than all our 100 airports put together. Air cargo integrated with road, rail and ports is the blood vessel of a growing economy. It is critical to understand that for passenger airlines to grow you need reforms in all areas of aviation such as air cargo, airports, aviation fuel and MRO (maintenance, repair and overhaul). Similarly, the air charter business has remained stagnant. It’s the breeding ground for pilots and engineers who feed the airlines. And the irony is that while we have around 4,000 pilots and thousands of technicians unemployed, we import foreign pilots and engineers to push up our operational costs.

Finally, our Aircraft Act and Rules go back to 1934 and 1937, respectively, when helicopters and jet engines were not invented. Although frequent modifications are issued, the overarching mother Act and Rules not keeping pace with modern technology in aerospace increase costs for the industry and, in effect, passengers. At the same time, our Directorate General of Civil Aviation (DGCA) cadre needs to be modernised, well-staffed, motivated and incentivised. Just as the Atomic Energy Commission and Indian Space Research Organisation (ISRO) are headed by scientists, DGCA must be helmed by an aviation professional from among their ranks instead of the ubiquitous IAS bureaucrat who may have been heading an animal husbandry department earlier. All these require comprehensive overhauling.

Our dreams are not big enough. And dreams, to be realised, must be accompanied by speedy execution along with deep reforms.

However, despite the setbacks and deterrents, there’s a silver lining. Whatever India may not possess, it has an inexhaustible market and largely untapped potential. That gives hope. Only one question has to be asked by policymakers. What should the government do to make the common man fly? How do we take the present 4 per cent who are flying to 50 per cent in the next two decades? And then set a target of another decade so that every Indian can fly at least once a year. That will lead to further questions—what incentives need to be given, what more reforms may be needed and what entry barriers could be removed to facilitate the entry of more operators?

That will show the road map to the future we all aspire to. 


The writer is Founder of Air Deccan

Published on: Feb 05, 2023, 10:29 AM IST
Posted by: Arnav Das Sharma, Feb 05, 2023, 10:27 AM IST