India one of the least penetrated markets for air travel: study

New Delhi, Apr 22 (UNI) India is one of the least penetrated markets for air travel as it is among the most expensive in the world and its air penetration levels are even lower than its neighbours Sri Lanka, Pakistan and countries with poorer GDP such as Ethiopia and Nigeria.

Indians take an average of 30 flights a year as against 65 trips by Chinese and 2,300 trips by the Americans which reveals that flying is yet to penetrate at faster pace in the country.

According to a paper on Air Travels between India and World', released by Assocham, ''Smaller country like Malaysia with about 1/50th of population in India flies more passenger per annum than in India and even in Sri Lanka and Pakistan, the average air travel is estimated at 30-35 as against India's 30 '' Assocham president Venugopal N Dhoot said in a statement that the basic and main reason for this abhorrent lack of advance in aviation industry in the country is the absence of proper infrastructure including international airports, domestic aerodrome conveniences and air control and navigational facilities.

The study highlights that 40 per cent of passenger traffic in India is concentrated in the two main airports of Delhi and Mumbai.

The top five airports in the country account for over 70 per cent of traffic and the top 25 account for almost 95 per cent of the air traffic.

Despite the fact that these airports have limited tunnel facilities, outdated infrastructure, inadequate ground handling system and poor passenger amenities increase the traffic congestion in airports.

It further reveals that the segment of luxury and super luxury travellers is nearly 70 times the air traveller segment. The number of passengers using premium rail services (air-conditioned and first class) in recent times was about 52 millions, more than three times the number of airline passengers (15.3 million).

This skewed distribution of travellers provides a very profitable opportunity for low cost carriers.

A comparable economy of China during 1980-2000 experienced a passenger traffic growth of 17 per cent CAGR, when its GDP per capita reached the threshold.

It further said the tourism driven economies like Thailand and Indonesia see a passenger count of 21.2 million and 9.4 million per year respectively.

In India, tourism is an important industry accounting for 2.5 per cent of GDP and ranks as the third largest foreign exchange earner.

The study also points out that India has more than 400 airports which can be connected by air and currently less than 100 are serviced despite the entry of new airlines.

The feeder routes segment in Indian aviation still remains highly under-served. The continuing increase in air traffic on the trunk routes has kept the major network carriers focussed on these routes.

Presently, almost 25 per cent of the total domestic movement in the country is between top six metros.

The regional market has been treated as an adjunct to the trunk routes with the result that convenient flights are not available on a large majority of such routes leaving a significant potential market in tier-II cities.

Currently, other than Indian airlines, only the LCCs like Air Deccan, GoAir link tier II cities to the metros.

The Chamber has suggested that if India wants its air penetration to go up, it will have to put in sound infrastructure facilities in place for both national and international tourists and increase the number of its air fleet from 250 aircrafts to about 1000 in a decade's time.

The Indian airspace will have to add capacities of around 15-20 per cent CAGR over the next five-six years to cater to the growing opportunity in this sector, the study added.

UNI AK SG GC2001