Indian aviation to see clear skies in 2015

CAPA cites $600 m FDI, electronic visas as positives

The year 2015 holds promise for India’s aviation sector with falling oil prices and improved economic conditions providing a favourable backdrop, aviation think tank Centre for Asia Pacific Aviation (CAPA) has said.

CAPA said that the government would need to take decisions on pending issues this year. The Narendra Modi government came to office with an agenda of removing red tape and distortions, it added.

“After facing a constant stream of economic, regulatory and structural challenges that resulted in India’s airlines losing a combined $11 billion over the last eight years, Indian aviation could be on the verge of entering a new era of profitable and sustainable growth,” it said.

However, it warned that this is “by no means a certainty” and all of the key stakeholders will have to play their part for the sector to recover and thrive.

off for too long, industry players will need to learn to operate in an open and competitive environment and allow vested interests to take a back seat.

“If this can be achieved, Indian aviation has massive potential that can be unleashed, delivering huge benefits to tourism, trade and the economy,” the think tank said.

Talking about the widespread confidence in the Indian aviation market’s fundamentals, it said that confidence in the growth prospects of the market is illustrated by the fact that three leading global airlines, Etihad, Singapore Airlines and AirAsia, have invested more than $600 million in Indian carriers over the last two years.

The government’s decision to roll out electronic visas to 43 markets, including the US, in November 2014 is also expected to transform inbound tourism and provide a boost to international traffic, it said.

Due to the overwhelmingly positive response in just a first few weeks, CAPA said that the Tourism Ministry has requested the Home Ministry to extend the scheme to key European markets such as the UK, France and Germany, as well as China.