<p>Though India witnessed a remarkable expansion in air transport sector in the past years, its contribution to country’s economy remains less than one per cent, National Council for Applied Economic Research said underlining the need for productive investment in the sector.<br /><br /></p>.<p>It also said that the air transport sector in India will continue to grow over the decade but needs the regulatory environment and investment in supporting infrastructure for further boost. “Air transport sector remains at the frontier of technological adaptation, generating employment and income at local levels, its contribution still remains less than one per cent of India’s GDP,” NCAER said in its latest quarterly review ‘Macrotrack’.<br /><br />The total air passenger traffic in India has increased from 109 million in 2008-09 to 143 million in 2010-11, a 31 per cent increase in three years. International (20 per cent) and domestic (37 per cent), its share to India’s prosperity is negligible. Air transport is important because of the global orientation of the Indian economy. It is also important as growth in this sector benefits many other sectors of the economy.<br /><br />“The direct impact of the air transport on the economy is that it generates income and creates jobs,” the study said emphasising the need for the fastest mode of transportation between Indian growth centres and their trade partners abroad. Of India’s 37 airports, only three in Delhi, Mumbai and Chennai, account for around 50 per cent of passenger traffic, leaving others with a small proportion of air passengers. The northern and eastern regions of India need significant investment in airports. Regulatory reforms are also needed to reform the international segment, it said.<br /><br />Experts too feel that Indian airline market capitalisation is an all time low. Airline in India have run into thousands of crores of debt for working capital, and the interest on these loans has hit the airline hard. Indian carriers have not made profit for a long time due to various reasons, major being the low fare war beginning 2003.<br /><br />The Indian carriers contribute to about a third of the worldwide airline losses even though they carry 2 per cent of global airline traffic.</p>
<p>Though India witnessed a remarkable expansion in air transport sector in the past years, its contribution to country’s economy remains less than one per cent, National Council for Applied Economic Research said underlining the need for productive investment in the sector.<br /><br /></p>.<p>It also said that the air transport sector in India will continue to grow over the decade but needs the regulatory environment and investment in supporting infrastructure for further boost. “Air transport sector remains at the frontier of technological adaptation, generating employment and income at local levels, its contribution still remains less than one per cent of India’s GDP,” NCAER said in its latest quarterly review ‘Macrotrack’.<br /><br />The total air passenger traffic in India has increased from 109 million in 2008-09 to 143 million in 2010-11, a 31 per cent increase in three years. International (20 per cent) and domestic (37 per cent), its share to India’s prosperity is negligible. Air transport is important because of the global orientation of the Indian economy. It is also important as growth in this sector benefits many other sectors of the economy.<br /><br />“The direct impact of the air transport on the economy is that it generates income and creates jobs,” the study said emphasising the need for the fastest mode of transportation between Indian growth centres and their trade partners abroad. Of India’s 37 airports, only three in Delhi, Mumbai and Chennai, account for around 50 per cent of passenger traffic, leaving others with a small proportion of air passengers. The northern and eastern regions of India need significant investment in airports. Regulatory reforms are also needed to reform the international segment, it said.<br /><br />Experts too feel that Indian airline market capitalisation is an all time low. Airline in India have run into thousands of crores of debt for working capital, and the interest on these loans has hit the airline hard. Indian carriers have not made profit for a long time due to various reasons, major being the low fare war beginning 2003.<br /><br />The Indian carriers contribute to about a third of the worldwide airline losses even though they carry 2 per cent of global airline traffic.</p>
