Asian budget airlines have their eyes on South India

South-East Asian budget airlines have set their eyes on southern Indian cities that are underserved by India's airlines. Regional low cost carriers (LCCs) like AirAsia, Nok Air (Thailand) and Tiger Airways (Singapore) all want to fly to cities like Bangalore, Chennai, Hyderabad and Cochin, which have already created a quiet success story for the south-centred Indian carrier, Paramount.

These four cities are all within three to five hours flying time from most South-East Asian capitals, which falls within the classic LCC formula for viability. Besides, there is a historical and cultural affinity between countries like Singapore, Malaysia and Thailand, all of which have large indigenous Tamil-speaking populations, apart from relatively more recent settlers, especially from Kerala. The two regions are bonded by centuries-old traditional links.

The Indian aviation industry has registered an overall passenger traffic growth of 24 per cent over the last five years, while the growth in South India is even more dramatic, at 20 per cent for international travel and 30 per cent for domestic passengers.

Both Hyderabad and Bangalore will have new world class airports by 2008, while Chennai will have one by 2010. Cochin's new international airport is in the black, and passenger volumes are bound to go beyond the 17 per cent growth last year on South East Asia routes, especially after bilateral aviation agreements are signed between India and Asean countries, on the lines of the recent pact with Malaysia.

India's Look East policy is aimed at enticing the dynamic Asean economies to be close trading partners, and the aviation sector can only expect to soar higher into the skies that will open shortly.