Civil Aviation Industry Analysis

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The civil aviation industry in India is on a steep growth trajectory, although with minor bottlenecks. Going by just the market size, the Indian civil aviation industry is among the top 10 largest aviation market in the world with a revenue size of around $16 billion. India has the potential of becoming the 3rd largest aviation market in the world by the year of 2020 and is expected to be the largest by 2030 even going past China and US.
Despite the fact that in the past few years, the aviation industry has seen lower growth rate akin to the slowing economy of India. The Civil Aviation Industry in India is going through a new era of expansion primarily driven by factors such as Low Cost Carriers (LCC), Foreign Direct Investments (FDI) in domestic
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It is nearly 60% more costlier than competing markets in the Middle East and ASEAN regions. This is due to the myopic vision in framing tax policies at the central and state level. Indian carriers half of the operating cost is through the procurement of this raw material - ATF. This explains the reason why the domestic flight ticket charges in India are often more expensive than a three day weekend tour package in Malaysia and Thailand. This is a serious impediment to the tourism potential of India. The biggest irony is that the common man, in whose interests these high taxes are imposed on ATF for the carriers, is himself prevented from flying because of these exorbitant travel costs. According to an estimate, nearly 99.5 percent of Indian population has not seen the insides of an aircraft. This is causing financial ruin to the airlines in India. Some of them are affected to such an extent that they are hoping for a white knight to bail them…show more content…
The 40% middle class population have the aspiration to fly but only 0.5% of Indians have used flight as a means of transport. This shows a huge market potential waiting to be tapped. It is critical for the stakeholders in the industry to collaborate and engage with policy makers to come up with decisions which are efficient and rational. This will shape the future of Indian civil aviation industry in a constructive manner. Right policies and a relentless focus on quality, passenger interest and cost, would be well placed to achieve India’s vision of becoming the 3rd largest aviation market by

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