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Top export sector for India: Aircraft and parts

 

Market data Points to note Fleet of state-run airlines Air traffic statistics

Aircraft and parts: Market data
(in US$ million)

1997

1998

1999*

Total market size

700

800

1190

Locally manufactured

70

75

80

Total exports

25

30

35

Total imports

655

755

1145

Exchange rate: US$ 1= Rs.

37.5

39.00

41.00

Source: Unofficial estimates of US Trade Dept.
* 1999 figures are estimates

 

Promising sub-sectors

1999

Large aircraft

540

Medium aircraft

600

Small aircraft

150

Points to note:

  • India will need 380 passenger aircraft over next two decades, according an estimate of Boeing Co. At 2000-01 cost index the acquisition would cost around US$ 25 billion.
  • The demand for aircraft is mainly for short-haul and single-aisle aircraft. Of this, short-haul will account for 65 percent of the additional demand for passenger aircraft. Boeing and Airbus are two dominating aircraft to the Indian fleet of civil aircraft. The list of aircraft suppliers to India also include British Aerospace, ATR-42, Dauphin, Dronier, Fokkar, Partenavia, deHavilland, Beechcraft, Bell and Cessna.
  • India’s new draft civil aviation policy puts greater emphasis on private sector participation to ensure promote investment in this sector. It also aims to woo foreign investors. The proposed new civil aviation policy will open up vast Indian market for aircraft, avionics equipment and other related businesses for foreign investors.

  • According to a forecast by National Council of Applied Economic Research, about 200 million households will be able to afford air travel by 2010. By 2005 Indian airports are estimated to handle 60 million international passengers; 1.2 million tonnes of international cargo; and 300,000 tonnes of domestic cargo.

  • Over next 7-10 years growth in domestic passenger traffic is estimated to grow by 12.5 percent per annum. Growth in international passenger traffic during this period is expected to be around 7 percent per annum. Domestic cargo traffic is estimated to grow at 4.5 percent per annum. Growth in international cargo traffic is estimated at 12 percent.

  • Air cargo traffic is rapidly increasing in India. A number of major international air carriers including Lufthansa, KLM, British Airways have increased their cargo capacities from India.

  • Logistics services are also on the growth path in line with global developments. Courier companies like DHL, Blue Dart, Elbee, Skypak are expanding their infrastructure along with expansion of their markets both within and outside India.

  • For very light aircraft (2-19 seats) India is in the process of establishing a domestic industry with both indigenous production and manufacture through collaborations with mainly European manufacturers.

  • For aircraft engines, players include GE Aircraft Engines, Pratt and Whitney of USA and Rolls Royce from the UK.

  • Boeing maintains a spare distribution centre in Singapore to service its clients in South East Asia. It has 31,000 different types of spare parts. Airbus also has a spare parts centre in Singapore to cater its clients in Asia and Australia-Pacific. The centre maintains 25,000 proprietary parts in the fast and medium moving categories.

  • As on Janaury 1, 2001, Air India has plan to add 16 aircraft to its existing fleet including four Medium Capacity Long range (MCLR) in next few years and Indian Airlines also plans to add 50 aircraft to its existing fleet including 50-seaters, 100-seaters, 150-seaters and 300-seaters.

  • In ten years (1990-1999) the number of passenger availing of private sector air services has increased from 15,000 to 56,92,000. International air services are handled by state-run Air India, Indian Airlines and other international airlines operating to India.

  • Segments earmarked for private investments include construction/operation of new as well existing airports/helipads/heliports related infrastructure besides cargo complexes, express terminals, cargo satellite cities. To encourage entry and operation of private airlines/airports, competitive regulatory framework with minimum controls is being structured. Price of ATF/AV Gas and various other charges are being rationalised to encourage private air services in the feeder and regional routes.

  • Foreign equity holding up to 74 percent will be permitted through automatic approval route and 100 percent with special permission of the government.

  • Private sector investment would be encouraged to provide domestic passengers and cargo air transport services. Foreign equity up to 25 percent and Non-Resident Indian investment up to 100 percent will be permitted for domestic passenger transport services but foreign airlines’ participation is totally barred.

  • Long term lease would be granted to private investors to restructure major airports under the Airports Authority of India (AAI). Private investments would be encouraged to promote airports in far-flung regions and airport charges would varry from airport to airport depending upon the facilities available at the concerned airport.

  • The requirement of helicopters is expected to increase with the use of helicopters in heli-tourism, adventure sports, mountaineering/trekking, point-to-point heli-services to bypass traffic congestion on the road , connecting remote areas and islands in North east, Andaman and Nicobar and Lakshadweep, religious places etc.

  • As on March 1, 2001, there are two scheduled private airlines, namely, Jet Airlines and Sahara Airline . There are 47 non-scheduled operators provide air-taxi/non-scheduled air transport services on March 1, 2001.

  • Considering the country’s geographical composition, Indian market offers vast scope for Helicopter. There two scheduled private airlines, namely, Jet Airlines and Sahara Airlines. There are 47 non-scheduled operators provide air-taxi/non-scheduled air transport services on March 1, 2001.

  • Currently, the state-run Pawan Hans Helicopters Ltd runs helicopters services within the country. Pawan Hans has a fleet of 30 Helicopters (20 Dauphin - SA 365 N; three Bell 206 L4; two Bell 407; two Robinson-R44; and three MF – 172) as on March 1, 2001.

  • Pawan Hans caters helicopter services to the ministry of Home affairs of the Federal government ,Oil and Natural Gas Corporation (ONGC)., state governments. of Punjab, and Arunachal Pradesh, Oil India Ltd. (OIL), Indian Oil (IOL), Gas Authority of India Ltd (GAIL), Hardy Exploration, Lakshadweep Administration and pilgrims visiting the Vaishno Devi Shrine etc.

  • There are several private helicopter operators including Mesco Airlines, Span air, Million Air Executive Jet Service and Deccan Aviation.

  • Bell Helicopters of US is a known face in the Indian market.

  • The state-run Hindustan Aeronautic Ltd (www.hal-india.com) is an established military aircraft manufacturer. Foreign companies such as Aeronautics, Ingersoll, GE, Allied Signal, Halter Marine are in regular touch with HAL to supply various parts and equipments. HAL has so long supplied about 2800 aircraft to the Indian Airforce of different types including 20 indigenous designs.

  • ALH is a multi-role, state-of-the-art, cost effective helicopter. ALH is designed to play civil roles like VIP travel, Commuter, Search and rescue, Emergency medical service, Underslung load, Disaster relief, Offshore operation etc. Under French licence, HAL’s Helicopter division has manufactured 600 helicopter till March 1, 2001.

  • With HAL’s commercial manufacturing of Advanced Light Helicopter (ALH), foreign spare parts manufacturers scope to sell their products in India gets widened further.

  • The prospects for both exports and investment in the aircraft and parts sector is enormous.

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Fleet of state-run airlines of India (As on January 1, 2001)

AIR INDIA 
(international carrier)

INDIAN AIRLINES 
(primarily domestic carrier)

Aircraft type Number of such aircraft in fleet Aircraft type Number of such aircraft in fleet

Boeing747-400 

6

Airbus A300 

11

Boeing747-200 

4

Airbus A320 

30

Boeing747-300 COMBI

 2

Boeing B737 

11

Airbus 310-300 

10

Dornier DO 228 

3

Airbus 300-84 

3    
Fleet size 25 Fleet size 55

Source: Air India, Indian Airlines

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India’s air traffic statistics

Year

Domestic Passengers 
(in million)

Increase
(in per cent)

International Passengers
(in million)

Increase
(in per cent)

1996-97(Actual)

12.00

10.5

10.8

7.0

1997-98

13.26

10.25

11.6

7.0

1998-99

14.65

10.5

12.4

7.0

1999-2000

16.20

10.5

13.3

7.0

2000-01

17.57

10.5

14.1

7.0

2001-02

19.06

8.5

14.9

6.0

2002-03

20.68

8.5

15.8

6.0

2003-04

22.44

8.5

16.8

6.0

2004-05

24.35

8.5

17.8

6.0

2005-06

25.05

7.0

18.8

5.5

2006-07

27.87

7.0

19.8

5.5

2007-08

29.82

7.0

20.9

5.5

2008-09

31.91

7.0

22.1

5.5

2009-10

34.15

7.0

23.3

5.5

2010-11

36.54

7.0

24.6

5.5

2011-12

39.09

7.0

25.9

5.5

2012-13

41.44

6.0

27.2

4.9

2013-14

43.93

6.0

28.5

4.9

2014-15

46.56

6.0

29.9

4.9

2015-16

49.35

6.0

31.4

4.9

2016-17

52.32

6.0

32.9

4.9

Sources: Airports Authority of India, Foundation for Aviation and Sustainable Tourism

 

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