Why India is buying planes more than other nations?
Published: 03:11 PM,Nov 03,2023 | EDITED : 08:11 PM,Nov 03,2023
airport
No nation in the world is buying as many airplanes as India. Its largest airlines have ordered nearly 1,000 jets this year, committing tens of billions of dollars to a spending spree that is unparalleled in aviation. In New Delhi, Indira Gandhi International Airport will be ready for 109 million passengers next year, as it prepares to become the world’s second busiest, behind Hartsfield-Jackson Atlanta International Airport in the United States.
And this is happening in a vast country still heavily reliant on trains — with 20 journeys by rail for every one by air.
The enormous aviation build-out, with a surge of investment behind it, has pride of place in India’s case for a greater standing on the world stage. As it moves up the ranks of the world’s biggest economies, India is scrambling to meet the expanding ambitions of its ascendant middle class. Its airports present highly visible achievements.
Air travel remains out of the financial reach of most Indians. An estimated 3 per cent of the country’s population flies on a regular basis. But in a nation of 1.4 billion people, that percentage represents 42 million — executives, students and engineers who yearn to get quickly from here to there inside India’s borders, and to gain easier access to destinations beyond, for both business and vacation.
Kapil Kaul, CEO of CAPA India, an advisory firm focused on aviation, calls “the next two to three years critical for achieving the quality of growth that India desires and deserves.” Growth has so far been profitless. Now Indian aviation must prove it can make money.
The effects of the spending spree should redound across India’s economy. Cargo comes with passenger traffic, and foreign investment tends to follow closely behind, Kaul said.
Arrivals to the international terminal at Indira Gandhi Airport are greeted by a wall of giant sculptural hands, their fingers and palms folded into the signifying shapes of the Buddha’s gestures, looking both ancient and futuristic. In 2012, when they were installed, 30 million passengers passed through the airport. By the time the airport has expanded to its new capacity, another one will have been built from scratch on the other side of the city.
Indira Gandhi Airport is racing to get bigger. In July it added a fourth runway and opened an elevated taxiway. The company that operates it, GMR Airports, took over in 2006, a time when all arrivals walked past cows lazing in the dust to reach a taxi stand. By 2018 the facility was rated as India’s most valuable infrastructural asset. To spare the use of jet fuel, a battery-powered TaxiBot lugs idling planes around the tarmac. An automated luggage-handling system can sort 6,000 bags an hour.
Two beneficiaries of India’s expanding aviation market are the world’s largest airplane makers: Boeing in America and Airbus in Europe. In February, Air India, which Tata Group took private last year, agreed to buy 250 planes from Airbus and 220 from Boeing, worth a combined $70 billion. In June, IndiGo, the country’s biggest carrier by passengers and flights, ordered 500 new Airbus A230s.
The bulk of the growth of Indian aviation has been among homegrown airlines, which have clocked a 36 per cent increase in passengers since 2022. Foreign tourist arrivals are rebounding since the pandemic, but are still relatively scarce, barely topping 10 million in a good year (about the same as Romania). So low-cost carriers are adding new countries to their destinations in order to accommodate India’s demand for foreign tourism. Azerbaijan, Kenya and Vietnam are all a direct flight from Delhi or Mumbai, India’s financial capital, for less than 21,000 rupees ($250) one way.
The air corridor between Delhi and Mumbai was already one of the world’s 10 busiest. Like Delhi, Mumbai has new airport terminals that would be the envy of any city in America, not to mention the glorious new all-bamboo Terminal 2 at Kempegowda International Airport in Bengaluru, a city in southern India. But the expansion in infrastructure is not limited to the country’s premier metropolitan areas.
Prime Minister Narendra Modi’s government likes to point out that the number of airports has doubled in the nine years since he took office, to 148 from 74. Jyotiraditya Scindia, Modi’s aviation minister, said there would be at least 230 by 2030. The government has invested more than $11 billion in airports over the past decade, and Scindia has promised another $15 billion.
That means that sleepy towns such as Darbhanga, a former principality in the impoverished state of Bihar in eastern India, now have nonstop access to Delhi, Bengaluru and beyond. For many of the 900 travelers a day who fill its flights, including plenty from nearby Nepal, the new airport has transformed the journey.
Prasanna Kumar Jha, 52, was born in Darbhanga but works in Delhi as a tax consultant. “Who ever expected that Darbhanga would be on the air map?” he asked. Flying to his hometown on short notice to see his ailing mother cost him 10,500 rupees ($126), which pinched.
“But if you calculate the alternative — by train from Delhi and then taxi to Darbhanga — it will take at least 30 hours,” he said. “The plane journey is no longer a luxury but a necessity.”
A report by CAPA India counted just 0.13 passenger seats per capita in 2019 for Indians, compared with 0.52 for Chinese and 3.03 for Americans. But aviation companies and India’s elected officials look at the low penetration and see opportunity.
A scarcity of competition, in the face of an emerging duopoly between IndiGo and the Tata-led airlines, is one of the new landscape’s most striking features. Smaller competitors keep going bust, most recently Go First, which declared bankruptcy in May. A shortage of pilots, after dozens were poached by bigger companies, forced Akasa Air, a promising upstart, to cancel flights in August.
But supply shortages are not the worst kind of problem to have in today’s global economy. With aviation’s growth in the decade before the pandemic steady at about 15 per cent a year, the Indian boom seems all but guaranteed to change the future of aviation worldwide. If the benefits accruing to the winners in India’s economy can be coaxed into trickling outward and downward, the same could go for many other sectors. — The New York Times.
And this is happening in a vast country still heavily reliant on trains — with 20 journeys by rail for every one by air.
The enormous aviation build-out, with a surge of investment behind it, has pride of place in India’s case for a greater standing on the world stage. As it moves up the ranks of the world’s biggest economies, India is scrambling to meet the expanding ambitions of its ascendant middle class. Its airports present highly visible achievements.
Air travel remains out of the financial reach of most Indians. An estimated 3 per cent of the country’s population flies on a regular basis. But in a nation of 1.4 billion people, that percentage represents 42 million — executives, students and engineers who yearn to get quickly from here to there inside India’s borders, and to gain easier access to destinations beyond, for both business and vacation.
Kapil Kaul, CEO of CAPA India, an advisory firm focused on aviation, calls “the next two to three years critical for achieving the quality of growth that India desires and deserves.” Growth has so far been profitless. Now Indian aviation must prove it can make money.
The effects of the spending spree should redound across India’s economy. Cargo comes with passenger traffic, and foreign investment tends to follow closely behind, Kaul said.
Arrivals to the international terminal at Indira Gandhi Airport are greeted by a wall of giant sculptural hands, their fingers and palms folded into the signifying shapes of the Buddha’s gestures, looking both ancient and futuristic. In 2012, when they were installed, 30 million passengers passed through the airport. By the time the airport has expanded to its new capacity, another one will have been built from scratch on the other side of the city.
Indira Gandhi Airport is racing to get bigger. In July it added a fourth runway and opened an elevated taxiway. The company that operates it, GMR Airports, took over in 2006, a time when all arrivals walked past cows lazing in the dust to reach a taxi stand. By 2018 the facility was rated as India’s most valuable infrastructural asset. To spare the use of jet fuel, a battery-powered TaxiBot lugs idling planes around the tarmac. An automated luggage-handling system can sort 6,000 bags an hour.
Two beneficiaries of India’s expanding aviation market are the world’s largest airplane makers: Boeing in America and Airbus in Europe. In February, Air India, which Tata Group took private last year, agreed to buy 250 planes from Airbus and 220 from Boeing, worth a combined $70 billion. In June, IndiGo, the country’s biggest carrier by passengers and flights, ordered 500 new Airbus A230s.
The bulk of the growth of Indian aviation has been among homegrown airlines, which have clocked a 36 per cent increase in passengers since 2022. Foreign tourist arrivals are rebounding since the pandemic, but are still relatively scarce, barely topping 10 million in a good year (about the same as Romania). So low-cost carriers are adding new countries to their destinations in order to accommodate India’s demand for foreign tourism. Azerbaijan, Kenya and Vietnam are all a direct flight from Delhi or Mumbai, India’s financial capital, for less than 21,000 rupees ($250) one way.
The air corridor between Delhi and Mumbai was already one of the world’s 10 busiest. Like Delhi, Mumbai has new airport terminals that would be the envy of any city in America, not to mention the glorious new all-bamboo Terminal 2 at Kempegowda International Airport in Bengaluru, a city in southern India. But the expansion in infrastructure is not limited to the country’s premier metropolitan areas.
Prime Minister Narendra Modi’s government likes to point out that the number of airports has doubled in the nine years since he took office, to 148 from 74. Jyotiraditya Scindia, Modi’s aviation minister, said there would be at least 230 by 2030. The government has invested more than $11 billion in airports over the past decade, and Scindia has promised another $15 billion.
That means that sleepy towns such as Darbhanga, a former principality in the impoverished state of Bihar in eastern India, now have nonstop access to Delhi, Bengaluru and beyond. For many of the 900 travelers a day who fill its flights, including plenty from nearby Nepal, the new airport has transformed the journey.
Prasanna Kumar Jha, 52, was born in Darbhanga but works in Delhi as a tax consultant. “Who ever expected that Darbhanga would be on the air map?” he asked. Flying to his hometown on short notice to see his ailing mother cost him 10,500 rupees ($126), which pinched.
“But if you calculate the alternative — by train from Delhi and then taxi to Darbhanga — it will take at least 30 hours,” he said. “The plane journey is no longer a luxury but a necessity.”
A report by CAPA India counted just 0.13 passenger seats per capita in 2019 for Indians, compared with 0.52 for Chinese and 3.03 for Americans. But aviation companies and India’s elected officials look at the low penetration and see opportunity.
A scarcity of competition, in the face of an emerging duopoly between IndiGo and the Tata-led airlines, is one of the new landscape’s most striking features. Smaller competitors keep going bust, most recently Go First, which declared bankruptcy in May. A shortage of pilots, after dozens were poached by bigger companies, forced Akasa Air, a promising upstart, to cancel flights in August.
But supply shortages are not the worst kind of problem to have in today’s global economy. With aviation’s growth in the decade before the pandemic steady at about 15 per cent a year, the Indian boom seems all but guaranteed to change the future of aviation worldwide. If the benefits accruing to the winners in India’s economy can be coaxed into trickling outward and downward, the same could go for many other sectors. — The New York Times.