The recently concluded Routes Asia in Mumbai successfully managed to bring policy and decision makers from aviation industry of Asia at one platform to discuss contemporary issues and chalk out the future course of action for the aviation industry in this part of the world. Inaugurated by Indian Aviation Minister Ajit Singh, the event saw the presence of GVK Reddy, Founder CMD, GVK; GV Sanjay Reddy, Vice Chairman, GVK; VP Agrawal, Chairman, Airports Authority of India (AAI); Rajeev Jain, CEO, MIAL; Anil Srivastava, Joint Secretary, Ministry of Civil Aviation (MoCA) and Jayant Kumar Banthia, Chief Secretary, Govt. of Maharashtra apart from CEOs and senior officials from various airlines, airports and tourism boards.
“The changes in the current policy framework and the liberalised ‘Open Skies’ policy by the government have propelled Indian aviation growth. To give impetus to international air travel, the government has taken substantial steps to liberalise and grant air traffic rights to Indian carriers to fly to several new destinations across the globe. To remove uncertainties about future rights and ensure better advance planning on part of the airlines, the Civil Aviation Ministry as a long-term plan has allocated air traffic rights to Indian carriers for winter 2012, summer 2013 and winter 2013. The new traffic rights have opened up several new international sectors and increased the traffic entitlements of airlines by approximately 60 per cent over the existing traffic rights,” said Singh.
The attendees were welcomed by Nigel Mayes, Vice President & Commercial, Routes. Hosts of the event, GVK, started the summit beautifully with G V Krishna Reddy revealing the history of the company and their plans this year, and G V Sanjay Reddy unravelling the group’s design for the new T2 at Chhatrapati Shivaji International Airport.
“The current traffic in Mumbai airport is 30 million passengers and we aim to take it up to 45 million. In Bengaluru it is 12 million and planning potential of 55 million. Mumbai is the financial capital and entertainment hub of India. Since 2006, from a domestic as well as international aviation perspective, it has been a thriving market for us,” revealed Sanjay Reddy. He further divulged their plans to design the new T2 at CSIA with inspiration from the national bird the peacock, and the intention of designing the Bengaluru Airport as a garden terminal to reflect its reputation as a garden city.
“We are very focused on safety and quality. Our standard has been that we have to be the best at everything we do. We also strive to be the most cost effective. I believe this is the beginning of us becoming a truly global aviation company,” he concluded.
Keynote addresses were delivered by Rajeev K Jain, CEO, Mumbai International Airport Ltd and Aditya Ghosh, President & Executive Director, IndiGo Airlines. Addressing the audience, Jain stated that civil aviation in India took off in the right sense in the last decade, owing to the burgeoning middle class, a very young population with a median age of 26, lower air travel costs. “In spite of a compound annual growth rate of about 18 per cent between 2003-04 and 2011-12, penetration of air travel in India is one of the lowest. On average, 0.1 trip per capita, i.e., one trip per person every ten years. If India reaches penetration level equivalent to the US, where average per capita trip is 1.8 to 2.0, with 1.2 billion people, it will create a market for 2.2 billion passengers. Even if we consider one-third of the same, there will be 700 million passengers, rivalling that of US. If artificial hurdles are removed, I am confident that demand for civil aviation will grow exponentially,” he stated.
He further added that the advent of LCCs fuelled aviation demand in India, with their market share reaching 70 per cent from three per cent in 2004. According to him, the likely addition of Air Asia to the Indian skies will result in increased competition, passengers will gain from it, and demand for air travel will rise further. “It is time to seriously consider reducing taxation on ATF in the public interest, as air travel can no longer be considered a luxury. Our airports require upgradation or development which needs huge amount of private investment. This will only come if return on investments is guaranteed. There will be a boost to the industry if major Indian airports are developed as hubs. This potential has so far not been reaped effectively. A dominant carrier is required for each potential hub. Airlines joining alliances will boost air connectivity,” suggested Jain.
Ghosh shared that his dream for the Indian aviation industry is to have 1000 flights from India, operated by several profitable airlines, carrying passengers through modern, efficient and cost effective airports at affordable costs. To realise this, he added, a resolution for change needs to be made. “There are three India’s in this country. The India in this room, the one in the villages, and the growing and impatient middle India. Inclusive growth is the need of the hour. We can certainly serve them in the next decade. The opportunity is staring at us. If we could convert another one per cent of Indian rail passengers to air, we would need double the aviation industry we have here today by tomorrow morning. That is, another 440 aircraft. We are at the intersection of need and opportunity, but not without challenges. We cannot keep expecting the government to do our job. Enterprises need to stand up for their own growth.”
He suggested that measures need to be taken for lower costs, equal job opportunities, safety, unbundling of fares and improved infrastructure. “Fuel import needs to be made easier. If India ratifies the Cape Town treaty, then aircraft lessors will be more inclined to lend us aircraft. In addition, we need to keep costs lower than revenues while also meeting customer’s demands with efficiency. We need to provide high quality low fare travel to maintain double digit growth,” he concluded.
Routes Asia 2014 will be held in Kuching in Saravak, Malaysia.
