Average airfares fall 18% as India emerges third-largest aviation market

India is now the third-largest aviation market in the world, with the civil aviation industry in India emerging as one of the fastest growing industries in the country during the last three years, even as average airfares have fallen by 18 per cent, making air travel more affordable.

India's domestic air passenger market recorded a 19 per cent growth from about 61 million in 2014 to 100 million in 2016-17, with a promise of further growth in the coming years, with the Regional Connectivity Scheme making a perceptive change in the aviation ecosystem.

Regional Connectivity Scheme, called UDAN, is expected to make growth in air travel more inclusive in nature as cheaper air fares make air travel possible for even the common man in remote areas.

Briefing the media on the New Civil Aviation policy and the roadmap, civil aviation minister Ashok Gajapathy Raju said his ministry has worked towards reshaping aviation ecosystem for affordable and convenient flying for everyone.

The minister said average or median airfares have fallen by 18 per cent during 2016-17, making flying more affordable for the common man. Scheduled domestic flight movements also rose from 7 lakh in 2014 to 8.2 lakh in 2016, an 8.2 per cent CAGR growth.

As against 395 aircrafts in the fleet of Indian carriers, there are 496 aircrafts in operation today, and another 654 are under procurement.

Route dispersal guidelines have been rationalised, multiple provisions have been made for MRO service providers and a slew of initiatives like the AirSewa portal, enhanced compensation for cancellation and boarding denial have been taken for improving passenger convenience

The Regional Connectivity Scheme UDAN has been by far the most path-breaking achievement of the ministry, he said, adding that 31 currently served, 12 under-served and 27 unserved airports are now connecting 128 RCS routes across the country. Fifty airports are being revived and 1.3 million new UDAN seats are being added annually under the first round of UDAN with a viability gap funding of Rs205 crore, he said.

Raju also said his ministry is also promoting Ease of Doing Business by allowing 100 per cent FDI in domestic scheduled air transport, open skies service agreements offers to 49 countries and 5 Saarc nations.

He said his ministry also is engaged in developing a robust security architecture by complying with ICAO requirements, promoting innovative technology like GAGAN, India's first navigation based system to improve accuracy of air navigation services and focusing on skill development in the aviation sector. 

About skill development, the minister informed that the first Executive Aviation Course was launched by India's first Aviation University in February 2017. The minister said that Aerospace and Aviation Skill Sector Council has been formed to monitor growth of skill development.

The Airports Authority of India (AAI) hired 800 ATCs over the last 2 years and more than 400 are planned to be recruited in 2017.

Speaking on the occasion minister of state for civil aviation Jayant Sinha said the civil aviation sector in India has undergone a complete transformation in the last three years with India emerging as the world's third largest aviation market. As against 70-75 airports in the country in all these years, we now have more than 100 airports with the implementation of UDAN.  The country will have 200 plus airports in the next 10-15 years, he said.

He said the capacity of existing major airports is also being increased rapidly, while greenfield airports are coming up at several places in the country like Goa, Navi Mumbai and other places.