South Asia is about to welcome over 2,700 new airplanes in the next two decades, with 90 percent destined for India. This growth projection demands approximately 37,000 pilots and 38,000 mechanics in the region, largely led by India.CAPA India forecasts a notable increase in both domestic and international air traffic for the forecast year 2024-25. Domestic air traffic is expected to grow by 6-8 percent, reaching 161-164 million passengers, while international traffic is projected to rise by 9-11 percent to 75-78 million passengers.

These projections highlight the vitality of India’s aviation market and the opportunities for stakeholders.In terms of aircraft, the numbers have increased from around 400 in 2014 to 723 in 2023 despite the Covid-19 impact. Currently, the country has 137 airports, two water aerodromes and nine heliports, which reflect the soundness of Indian aviation.Airbus commands over two-thirds of the market in India in the civil aviation space and accounts for 84% of the country’s narrow-body aircraft. The success may not be replicated in wide-body space, but the journey may have just begun for Airbus.The two main players in the Indian skies are Indigo and the Air India group. Presently, Indigo has a market share of around 60 percent, while Air India group airlines have a 26 percent share.

As part of aggressive expansion plans, Air India is eyeing market leadership in the long and ultra-long haul segment, which is key to its business. Indigo will look to continue its domination of the domestic market, while looking to expand its international market footprint.Akasa Air is set to purchase 150 737 MAX aircraft increasing its total orders from Boeing to 226, with deliveries slated through 2032. Positioning for the launch of international operations, it currently serves 16 destinations with 24 aircrafts.

It has nearly four percent share of the domestic market.Spicejet is raising fresh capital of over $270 million from Elara India Opportunities Fund, Aries Opportunities Fund, Mahapatra Universal, Nexus Global Fund, PrabhudasLilladher and Resonance Opportunities Fund. This is expected to help mitigate the airline’s liquidity crunch, enhance operational capabilities, and make for sustained growth.Presently only around 15 percent of MRO activity for Indian airlines is conducted in India. With two of the largest aircraft orders ever from IndiGo and Air India on Airbus and Boeing last year, India stands out as a significant aircraft buyer.

However, for want of MRO services, a major chunk of this business is lost to MROs overseas. Hopefully, 2024 will see a push from airlines for engine and aircraft manufacturers to set up MRO services in India.IFSC Gift city has seen the registration of 26 aircraft leasing companies in the past three years. Over 129 aviation assets have been leased through it, including 18 aircraft, 55 engines and 56 ground support assets.

Air India is directing its aircraft leases through its aircraft leasing entity in GIFT City and Indigo is likely to follow suit. While, India has to improve its rating at the repossession index, if supported by the right regulatory, legal and tax framework, GIFT City is likely to become a hub for aircraft finance and leasing activities in the times to come.