“We are proud of our reputation for excellence within the industry and look forward to continuing to play an active and positive role in the development of India’s vibrant aviation sector”
New CAPA Report identifies General Aviation in India as the next growth wave
(New Delhi, 2 February 2011) In a revealing new Report released today by CAPA India, the country’s General Aviation (GA) sector is highlighted as a major growth opportunity. CAPA projects that the industry could see new aircraft sales – business jets, helicopters, turboprops and piston engines – of up to USD12 billion over the next decade, by which time the GA fleet is expected to reach 2,000 aircraft, up from 680 today. The Report estimates that the direct and indirect economic contribution of GA could be close to USD4 billion per annum by 2020.
The Report sheds light on a sector that has to date operated largely in the shadow of scheduled commercial aviation. Kapil Kaul, CAPA CEO South Asia, explained, “After almost eight years of continuous monitoring of the Indian aviation sector, it became apparent to us that despite the fact that the GA fleet is already significant in size, with 680 aircraft, little is known about it. Our initial enquiries found that fleet and traffic data was limited and unreliable, only a handful of operators reported financials and grey areas abounded. The fact that the sector is highly fragmented, unstructured and under-funded means that it has remained under the radar.”
CAPA concluded that there was a need for:
- a detailed and methodical review of the GA sector as it stands today; and
- a vision for where the sector could be in 2020.
Huge potential – but no framework
“What we found was a paradoxical situation of a sector which exhibits huge growth potential and yet has virtually no dedicated policy or regulatory framework nor infrastructure to support it. Aside from the operational challenges which this presents, there are significant implications for safety and security. However, with a clear vision of the potential for GA in India, and a commitment by industry and government, the sector could emerge as an exciting driver of economic development and one which establishes a leadership position in the Asia Pacific region,” stated Mr. Kaul.Need to prepare for growth
The Report highlights some of the hurdles that need to be cleared before take-off. Ensuring that dedicated infrastructure is available (fixed base operators at airports, helipads, aircraft management companies, maintenance facilities and training centres) – and in the right places – is a fundamental condition. Air navigation services and air traffic control are equally important and sometimes forgotten. And preparing to deliver the necessary levels of skilled resources is essential.India’s outlook is for strong and sustained economic growth of close to 9% per annum over the next decade. Buoyed by robust corporate profitability, increasing international trade links and emerging new industrial and mining belts in remote regions, the prospects for business jet activity are very positive. The Report also identifies significant opportunities for helicopters which can be deployed in a wide variety of activities and for which the costs of developing infrastructure (such as helipads) are relatively low.
A shake-up is necessary
The sector needs a shake-up for this to happen. This includes providing:- recognition of the role of GA at a policy level;
- application of high and consistent regulatory and training standards;
- relaxation of the currently negative fiscal environment in certain areas, and
- market entry by professional, experienced and well capitalised operators.
CAPA’s Report sets out the scale and scope of India’s GA industry today, and indicates just how large and important its potential is. CAPA found that GA could make a significant contribution to regional economic development by enhancing passenger and freight connectivity to remote areas, as well as supporting essential services and tourism.
The Report also provides a draft of actions for the industry and the Government to consider, if the sector’s potential is to be achieved. It outlines some of the significant opportunities for individual players to invest in the sector, in areas such as regular charter; fractional ownership; fixed based operations; aircraft management; maintenance and repair; interior completion and refurbishment centres; manufacturing and design; training; and new sports and recreational ventures.
CAPA’s India Business & General Aviation Report 2011 is now available for purchase in hard copy via the order form that can be downloaded here.
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