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CIVIL AVIATION

FDI In Civil & Aviation

The civil aviation industry in India has emerged as one of the fastest growing industries in the country during the last three years. India is currently considered the third largest domestic civil aviation market in the world.

The country has 86 scheduled international airlines comprising of 5 Indian carriers and 81 foreign carriers, which ensure that India is well connected with most major countries. Revenue passenger kilometres (RPK) in domestic airline demand rose by 18.7% in 2017-18. Indian carriers reported a combined profit of $ 122 mn in 2015-16.

In February 2019, the Government of India sanctioned the development of a new green-field airport in Hirasar, Gujarat, with an estimated investment of Rs.1,405 crore ($194.73 mn). As of January 2019, the Government of India is working on a blueprint to promote domestic manufacturing of aircrafts and aircraft financing within the country.

Up to 100% FDI in civil aviation in India is permitted in Non-scheduled air transport services under the automatic route.

Up to 100% FDI is permitted in helicopter services and seaplanes under the automatic route.

Up to 100% FDI is permitted in MRO for maintenance and repair organizations; flying training institutes; and technical training institutes under the automatic route.

Up to 100% FDI in aviation sector is permitted in Ground Handling Services subject to sectoral regulations & security clearance under the automatic route.

 

  • 1

    9th largest Civil Aviation market in the world

  • 2

    Fastest growing domestic air market in the world

  • 3

    Aviation sector in India currently supports 8 million jobs

The Aviation sector in India currently contributes $72 bn to GDP

Domestic airlines carried 123.32 mn passengers during 2017-18 compared to 103.75 mn during the previous corresponding period. For the corresponding period, IndiGo held a market share of 39.7%, followed by Jet Airways (15%), SpiceJet (13.1%), Air India (12%), GoAir (8.8%), AirAsia India (4%), Vistara (3.6%) and JetLite (2.2%)

To cater to the rising air traffic, the Government of India has been working towards increasing the number of airports. As of March 2019, India has 103 operational airports. India has envisaged increasing the number of operational airports to 190-200 by FY40

In FY18, domestic freight traffic stood at 1,213.06 million tonnes, while international freight traffic was at 2,143.97 million tonnes

As of July 2018, there were nearly 620 aircraft being operated by scheduled airline operators in India. The number of airplanes is expected to grow to 1,100 planes by 2027

  • New airport addition

    Aim to increase the number of operational airports to 250 by 2020
  • Expanding R&D hub

    $ 120 bn investment in airport infrastructure
  • Market advantage

    India’s aviation market to become 3rd largest by 2024
  • The significant increase in M&A activities

    Etihad-Jet, Tata-Singapore Airlines, Tata-Air Asia
  • Regional connectivity

    Boost air connectivity to smaller cities & northeastern states
  1. June 2018: India has signed an open sky agreement with Australia allowing airlines on either side to offer unlimited seats to six Indian metro cities and various Australian cities.
  2. Feb 2018: Mahindra Aerospace and Canada’s Viking Air have signed a memorandum of understanding to form a strategic alliance for making smaller aircraft to support regional air connectivity in India.
  3. Feb 2018: AAI is going to invest Rs.15,000 crore ($2.32 billion) in 2018-19 for expanding existing terminals and constructing 15 new ones.
  4. Oct 2017: Indian aircraft Manufacture, Repair and Overhaul (MRO) service providers are exempted completely from customs and countervailing duties.
  5. Aug 2017: The AAI plans to develop Guwahati as an inter-regional hub and Agartala, Imphal and Dibrugarh as intra-regional hubs.
  6. June 2017: IndiGo, having 42% of the Indian aviation market has entered into a partnership with global distribution system services operator Travelport, to expand its global presence by distributing its ancillary products to the portal’s customers across 180 countries.

  • $100 bn FDI in civil aviation sector - Air Transport (including Air Freight) during April 2000 – March 2019
  • 100% FDI in aviation allowed in both greenfield and brownfield projects for Airports
  • 49% FDI allowed in ground handling and maintenance and repair organizations
  • <49% FDI in Scheduled Air Transport Service/ Domestic Scheduled Passenger Airline and Regional Air Transport Service under the automatic route
  • >1.8% FDI in Scheduled Air Transport Service/ Domestic Scheduled Passenger Airline and Regional Air Transport Service under government route

Data of Map

Passenger Traffic

Videos

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