More Indians are taking to the skies

The Indian aviation sector has witnessed major capacity addition during the last six years. The fleet size increased and demand for domestic and international travel has grown close to 100% in the last six years.

In 2010-11, airlines in the country carried 60 million passengers on the domestic routes against close to 25 million in 2005-06.

According to Crisil research, domestic passenger traffic has grown at an average annual rate of 16.5% during the last six years. The agency expects it to grow at an average annual rate of 12-14% to reach about 97 million in 2015-16.

Growing affluence has translated into increased foreign holidays. This growth is evident from the fact that a number of foreign airlines, including Emirates, are nearing their maximum seat capacity allotted under bilateral agreements.

Vishwas Udgirkar, senior director, Deloitte India, points out, “The entry and stabilisation of new private airlines brought in more capacity — new routes emerged and existing ones turned competitve. This has led to more reasonable fares.”

Girish Shirodkar, partner and MD, SDG Group, says the growth in domestic passenger traffic is spurred by economic growth, which has led to increase in air travel on metro and non-metro routes.