Focus on non-metro cities: Scindia

With passenger capacity projected to be doubled from existing 200 million to 400 million in next seven to 10 years in India, there is huge growth opportunity for airlines, says Jyotiraditya M. Scindia, Union Minister of Civil Aviation and Steel. Government is also doing its bit by putting in place new policies and removing impediments, he adds.

Janice Alyosius

Jyotiraditya M. Scindia, Union Minister for Civil Aviation & Steel, addressing ‘ASSOCHAM CEOs Roundtable: The Roadmap for Robust Growth Over Next Decade’, recently said, “Interactive forums like these help the central government in effectively playing its role as a facilitator. Growth opportunities for airlines are tremendous as traveller volumes will double from an estimated 200 million currently to 400 million in the next seven to 10 years.”

Stating that future growth will come from non-metro cities, Scindia said that the government is continuously working to put in place new policies and removing impediments to enable its faster growth. “It is an area where we are trying to focus on with the small aircraft programme, which I started almost four or five months ago,” he said.  The non-metro growth rate, which was 10.8 per cent from 2010 to 2015, grew rapidly to 31 per cent, he said, adding that the growth rate in metro cities was 7.8 per cent from 2010 to 2015 and grew to roughly 8-9 per cent in the past six to seven years.

Elaborating, Scindia said, “From an estimated 400 aircraft in 2013-2014, the fleet of aircraft has grown to about 700 now and we are adding a delta of almost 15 per cent per annum, which means the fleet size will grow up to 1,200 in the next five years. While we had 74 airports in 2013-2014, we added 67 airports in the past eight years.”

He explained, “From a strategic perspective, every industry follows an evolutionary curve, which is an “S-shaped” growth curve. The infancy stage is the lower half of the curve, which the civil aviation sector has surpassed. We are now in the growth phase—the middle part of the curve—where growth begins to flatten out again. So, it is time for us to aim for our potential.” He said, “Civil aviation is competing with the Indian Railways, especially in the air conditioned segment. While the airlines carried 144 million domestic travellers before COVID struck the globe, the Railways carried 125 million passengers in 1st and 2nd AC compartments.” He added, “In the next five to 10 years, civil aviation will carry the bulwark of civil transportation in this limited section. While the civil aviation is growing at 10.3 per cent Compound Annual Growth Rate (CAGR), the railways is growing at 5.6 per cent (CAGR).”