2022

Aviation Industry

GROUP NUMBER: - 1
NAME ROLL NUMBER
ABHISHEK DIVYADARSHI F2022004
AKSHITA SHARMA F2022008
ESHA MITTAL F2022020
HARSHWARDHAN VIPAT F2022022
SANMAY SUNIL KUDE F2022044
SURAJ KUMAR SHARMA F2022057
 Executive summary
The aviation industry in India is in a growing stage. It stands at around $900
million and is anticipated to grow to $4.33 bn by 2025, increasing at a CAGR of about 14-
15%. This growth will be attributed to more middle-class people choosing to fly, increasing
competition between low-cost airlines, new entrants, improving connectivity in their 2-3
cities, new port buildings, and, last but not least, conducive government policies.
But, everything is not as straightforward, price-sensitive Indian consumer, highly capital-
intensive business, volatile oil prices, or oil shocks if we look at today’s times. Lastly, sudden
shocks like COVID can be massive roadblocks to industry growth.

Only time will unfold the natural growth that will follow Indian aviation.
 Why this Industry?

MAJOR CONTRIBUTOR TO GLOBAL ECONOMIC PROSPERITY -

• Aviation offers a medium for efficient global transportation, making international

trade and transport accessible and efficient. It fosters job creation and economic
expansion and eases travel and trade abroad. Recent estimates by the cross-industry
Air Transport Action Group (ATAG) place the worldwide aviation industry's entire
economic impact—direct, indirect, induced, and tourism-related—at USD2.7 trillion
in 2014, or about 3.5 percent of the world's gross domestic product (GDP).

• Additionally, 62.7 million jobs were supported internationally by the aviation sector.
9.9 million direct employment was created by it. More than three million people are
employed by the aviation industry directly by airports, airlines, and air navigation
service companies. 1.1 million people were used in the civil aerospace sector, which
included the production of aircraft, systems, and engines. 5.5 million more people had
additional jobs at airports. Aviation produced 52.8 million induced, indirect, and
tourism-related employment. And other economic benefits of aviation, such as jobs or
economic activity created by businesses or industries that exist because of air travel,
the intrinsic value that speed and connection of air travel give, or domestic tourism
and trade, are not included in these estimations. By having these, the employment and
overall economic impact figures would grow.

A Growing Industry worldwide-

• The air transport industry is expanding, and data suggests that the future of aviation is
bright.
• Around 4.1 billion passengers flew on aeroplanes around the world in 2017. Thirty-
seven million commercial flights carried 56 million tonnes in freight. Over 10 million
people and about 18 billion dollars worth of cargo are transported daily by aeroplanes.
 According to the most recent projections, over the next 20 years, demand for air travel
will rise by an average of 4.3%.

• By 2036, if this growth trajectory is followed, the global transportation sector will
generate 15.5 million direct employment and $1.5 trillion in GDP. These figures
could increase to 97.8 million employees once the effects of international tourism are
considered.

Country Chosen – India

Why India?

• Over the past three years, Data suggests that India's civil aviation sector has been one
of the nation's fastest-growing industries. As of 2021, India has overtaken the United
 Kingdom to become the third-largest domestic aviation market in the world, and by
2024 is predicted to surpass it. In 2016, it registered 131 million passengers flying
across its airspace, of which 100 million were domestic passengers. Jet Airways, Air
India, and AI Express were the top three airlines by the volume of international
passengers they carried into and out of India in 2016. (8.8 million). Emirates (5.46
million), the most significant foreign airline operating in India, came in third.

• The industry generates millions of employments locally in various related industries,

including airport management, MRO, and air traffic control. The main forces driving
the business are passenger air travel and trade demand.
 Huge Market size –

• The sector's increasing demand has increased the number of aircraft operating there.
By 2027, 1,100 planes are anticipated to be in operation worldwide.188.89 million
people traveled through India as passengers* in FY22. Airports in India estimate that
domestic passenger traffic will reach 166.8 million in FY22, up 58.5% year over year,
while international passenger traffic will reach 22.1 million, up 118% year over year.

• It is admirable to witness that Freight traffic in aviation increased at a CAGR of

2.52% between FY16 and FY22, rising from 2.70 MMT to 3.14 MMT. It has been
estimated that Freight traffic at airports in India has the potential to reach 17 MT by
FY40. In FY22, the number of aircraft movements increased and reached 1,757,112.

• The Government of India is concentrating on increasing the number of nationwide

airports to penetrate the country's distant areas to meet this growing demand for
aviation. In India, there are now 129 functioning airports as of 2022, according to
official data. The GOI has set a target of around 190–200 operational airports by
FY40.
 High growth potential

• According to data from Goldman Sachs' economic prediction for India, the
International Air Transport Association has projected that by the year 2030, India is
expected to have 300 million people departing via the movement of 6 million
aeroplanes. Future Growth Prospects: High Growth Potential By 2032, it is
anticipated that there will be 11.4 million tonnes of freight flow, making air cargo a
significant contributor to the logistics sector.

• Given that the bulk of the country's population—nearly 40% of whom are upwardly
mobile middle class—still finds flying prohibitively expensive, India's aviation
industry is unexplored primarily and offers tremendous growth potential.

Increasing Investment-

• Between 420 and 450 billion investment is expected in India's aviation industry
between F18-23.
• It can also be witnessed that private sector partnership is increasing through a public-
private partnership.

• Airlines - India's domestic carriers operated just over 700 aircraft in 2021. However,
in the upcoming years, this number is anticipated to rise. Experts predict that by 2027,
there will be 1,100 aircraft.

• Airports - are essential nodes in the value chain of air travel. India anticipates that by
2040, as aviation demand grows throughout the nation, there will be 190–200
operating airports. While the government claims that just 68 airports have been
operationalized for the Regional Connectivity Scheme, it is recognized that the
 Airports Authority of India (AAI) controls 137 airports. By 2024, New Delhi hopes to
have 100 airports operational in a drive to improve land and maritime infrastructure.

An Untapped Market

• In India, it can be witnessed that the demand for air travel has been rising for several
reasons, which go beyond the country's expanding population.
• The nation's expanding middle class and growing working population are the primary
reasons behind this increased demand. It can also be noted that demand growth has
continuously outpaced supply increases in recent years, leading to high utilization.
According to data from PRS Legislative Research, domestic air travel in India
accounts for 69% of all air travel in South Asia.
• According to OAG data, which ranks airports by scheduled airline capacity for the
month, Delhi's Indira Gandhi International Airport is now the ninth busiest airport in
the world. Other significant airports in the nation are found in the major cities of
Mumbai, Chennai, Bengaluru, Kolkata, and Hyderabad.
• Before the epidemic, the biggest airports in India significantly increased passenger
traffic. Forty-eight million people used Delhi airport in 2016, while 69 million did so
in 2019. In other parts of the nation, there has been a similar rise in traveller numbers,
with Kolkata seeing a jump from 12 million in 2016 to 22 million in 2020.

Policy support–T

• Under the automatic route, foreign investment up to 49%is allowed.

• Under the union budget 2021-22, the government of India decided to lower the customs duty
from 2.5% to 0% on components or parts, which include engines for aircraft manufacturing
by public sector units that come under the ministry of defence.
• The government unveiled a new policy last year intending to lure MRO investment and turn
India into a worldwide MRO powerhouse. Instead of being leased for three to five years, as
was the case under the initial conditions, the land allocation for MRO facilities will now be
for 30 years. India currently holds a mere 2.5% of the $80 billion global MRO market
 Industry Structure

The aviation industry follows an Oligopolistic structure.

The aviation market in India has only a few prominent players controlling a significant chunk
of the market.
It is a case of imperfect competition.
Look at the graph below; it shows the market share of various airlines in India.

Since there are only a few prominent players, they have the market power to set prices.
There is a great demand for aviation services and only a few service providers, making them
market controllers.

The prices established by Airlines are more or less in line with the completion, with a few
airlines giving discounts. Since all the airlines do the primary job of flying passengers with a
slight difference in the services offered, consumers prefer the cheapest one.
Especially in a country like India with the most price-sensitive consumers, the action of
offering lower prices by one airline can result in others losing market share. It cannot ignore
the reaction of the rival firms.
All players must comply and consider the actions of other competitors in an oligopolistic
structure. Such the nature of the market makes it a closely interdependent one.

The aviation industry entails huge fixed costs attributed to fuel, aircraft carriers, and airport
parking charges. All of these make entry and exit of firms extremely difficult. One needs to
have deep pockets to enter the aviation sector, and at the same time, the door is also a costly
affair.

Due to its structure, it is more efficient in its process.

Supporting Industries
Various industries support the aviation industry to function. Some of them are below:
-

1. Aluminium is one of Earth's most efficient and abundantly available metals. It is also
lightweight and most versatile as it can easily be combined with other metals and
improve its and other metals' properties. It does not have any use in its pure form, but
when combined with other metals, it changes its properties and comes into use. Its
alloy is named via the 4digit number system, with the first digit representing the alloy
group and the other numbers representing the different metals in the alloy. A few
examples of aluminum alloy are 2024-T3,6061-T6,3003-H14,7075-T6.
There are three main reasons to use aluminum in flight 1. High strength/weight ratio
2. Ductility 3. Corrosion resistance. The high strength-to-weight ratio represents the
ratio of the alloy's power to its weight. The more the balance is, the better the alloy is.
The flexibility is the ability of the property of the metal to draw or deform until the
point it breakdown. These alloys need to be very corrosion-free as corrosion leads to
the destruction of metals, and as flights are costly, the company cannot afford to have
decay.
Currently, Australia is the largest producer of aluminum ore, and China is the largest
producer of aluminum.
Different companies manufacture various types of an airplane that serves other
purposes. Boeing and Airbus manufacturers mainly manufacture the plane used for
traveling passengers. Bombardier and Embraer are aircraft manufacturers that
manufacture business planes. Similarly, there are different companies to serve the
purpose of the military and supply chain. Indian players in this sector are Tata
Advance Systems Ltd(Tals), Mahindra Aerospace, Bharat Forge, and Reliance
Defence Ltd.
2. The Food and Beverage sector has a massive market in the aviation sector. In-flight or
airline catering is the service offered to passengers during the journey. In-flight
services have the highest level of safety for food items. They are also a chief provider
of freshly prepared food with higher safety standards. The main idea behind
introducing food is to provide the customer with high satisfaction and a good
experience. It also resulted in making profits for the companies. There are
3. In aviation, fuel is the main component of any aircraft. The fuel used is basically of
two types: kerosene or petroleum. The fuel used here possesses better quality than
used in any other transport sector. There are different aircraft fuel types Jet A, Jet A1,
Jet B, JP 5, JP 8, Avgas, Biofuel, etc.
4. Rubber in aircraft demands high quality for their top components. These components
must be superior in quality as they are continuously exposed to extreme weather
conditions such as excessively hot or cold weather and different types of oils and
gases. It is too vital for airline companies to protect passengers and cargo from these
elements.
Synthetic rubbers from various sources withstand these highly aggressive aerospace
fluids, including, Engine lubrication oils, jet fuels, hydraulic liquids, oxidizers, rocket
propellants, etc.
Some of the standard materials used are Neoprene, EPDM and silicone.
Some of the applications of using rubber in the aerospace and aviation industry are: -
• Thermal insulation
• Window and door seals
• Bumpers
• Instrument panel seals and engine gasket
5. The coming-up of online ticket booking websites has made it easier for both
passengers and aviation companies. Earlier there were a lot of difficulties that were
faced by passengers as they do not have much clarity about the timing of the flight
and also to book a ticket they need to go to the airport which is again far from the city.
Now with the coming up of websites, passengers can book tickets easily at home by
charging some convenience fees. They contact the airline, generate a PNR and
booking reference, which passengers need to show at the airport, and travel quickly.
Also, with the coming up of these websites, people can promptly reschedule and
cancel tickets and pay and get the refund in their banks in lesser time. A few examples
of Indian websites or apps are MakeMyTrip, goibibo, cleartrip, EaseMyTrip,
yatra.com, and IRCTC air.
6. Airport buses or shuttles are mainly used to transport people to and fro within the
airport. They are operated either by the airport authority, airline, or third party. The
airport also uses cabs for the same purpose, but it carries only Airports, flight staff, or
some VIPs. There are many
7. Airports require different types of human resources at each level of work. Some of the
job roles are food service worker, passenger assistant, airline baggage worker, avionic
technician, flight attendant, air traffic controller, aircraft fueler, airport manager, pilot,
aircraft maintenance technician, airport engineer, airport security officer, flight
dispatcher, airport operation manager, aircraft mechanic, airport planner aeronautical
engineer. All these jobs require training and generate many opportunities for people
across the country. There are particular schools to train this personnel, such as The
Bombay flying club for piot, Frankfinn institute of air hostess for training air hostess.
 Government schemes and Programs for the aviation sector in
India
The Indian Government has launched many schemes to improve the aviation experience for
ordinary people. These schemes' primary focus is on providing better hassle-free service and
keeping the air passenger's safety and security. The Government has given a series of
statements of guidelines to which any aviation company operating in India to follow and
adhere to it. The Indian Aviation sector has private players like Indigo, Air India, SpiceJet,
Go First, Vistara, Air Asia, Air India Express, Jet Airways, and Akasa Air.
The Most recent schemes launched by Govt. OF India is UDAN.

UDAN(Ude Desh Ka Nagrik)

This scheme was launched by the PM of India, Narendra Modi, in June 2016, under the
Ministry Of Civil Aviation, Central Body. This scheme offers air tickets at a subsidized rate
and will be funded by both State and Central governments. This scheme has been operational
for ten years and will be later extended according to the need.

Objectives:

• To operationalize the 100 unserved and underserved airports. Underserved airports

mean airports that do not have more than one flight a day, and Unserved airports are
airports that have not yet Air flight operations started.
• To connect at least 1000 regional airports of India.
• To provide low and affordable air services to ordinary people in small cities and
regions.

Achievements:
• To date, 387 routes and 60 airports have been operationalized, out of which 100
routes are awarded for the North Eastern States.
Phases:

UDAN 1.0:
• Under this phase, five airline companies were provided to operate on 128 new air
routes from 70 Airports, which includes 36 newly operational Airports.
UDAN 2.0:

• Under this phase, the ministry of civil aviation announced that 73 underserved and unserved
Airports to be covered under this scheme.
• Helipads were also connected under this phase
UDAN 3.0:
• During this phase, tourism routes were added with the cooperation of the Ministry Of
Tourism.
• Inclusion of seaplanes done for connecting water Aerodromes.
• Bringing in the northeastern region routes

UDAN 4.0:
• Seventy-eight new routes were included under this phase to promote more regional
connections.
• Kavaratti, Agatti, and Minicoy Island of Lakshadweep will be connected under the
new routes approved in this phase.

UDAN 4.1:
• We focus on connecting more minor airport routes, particularly helicopter and
seaplane airports.
• New routes were proposed under the sagarmala seaplane sub-services.

Sagarmala Seaplane Services:

This project is incorporated under the ministry of Port, shipping, and waterways with many
airline operators.
 KRISHI UDAN SCHEME:

• Ministry of Civil Aviation launched it in August 2020 to promote the transportation of

Agricultural produce on international and National Air routes.
• Under the KRISHI UDAN SCHEME, 16 airports have been identified in the
northeastern region to enhance the export and cargo movement opportunity through
these regions.

Regulating Bodies Of Indian Air Aviation

Some essential regulatory bodies look out for the functionality and operation of the aviation
sector in India, which are as follows:

1. Ministry of Civil Aviation

In India, the Ministry of Civil Aviation is the nodal ministry in charge of developing
national policies and programs for civil aviation development and regulation. It creates and
implements plans for the country's civil air transport to grow and expand in a planned
manner. Its responsibilities also include overseeing airport facilities, air traffic services, and
the air transportation of passengers and goods.

2. Directorate general of civil Aviation (DGCA)

A statutory body to regulate civil aviation in India and to ensure safe and secure Air
transportation. Its headquarter is in Sri Aurobindo Marg, New Delhi.

3. Airport Authority of India (AAI)

A Statutory Body under the Indian Ministry of Civil Aviation, the Airports Authority
of India (AAI) manages airports throughout the country. It is responsible for developing,
enhancing, administering, and maintaining India's civil aviation infrastructure. Over Indian
airspace, it offers communication navigation surveillance (CNS) and air traffic management
(ATM) services. Currently, AAI is responsible for administering 137 airports, comprising 34
international airports, ten customs airports, 81 domestic airports, and 23 civil enclaves at
Defense airfields. AAI has 25 ground installations outside of India's airports to maintain the
safety of aircraft operations. Through 700 VOR/DVOR installations with Distance Measuring
Equipment and 29 Radar Installations at 11 Locations, AAI covers all key flight routes in
India (DME). It oversees 52 runways with instrument landing systems (ILS) and night
landing capabilities.

The Government of India constituted the International Airport Authority of India

(IAAI) in 1972 to look after the nation's international Aircraft operations and the National
airport authority of India in 1986 to look after the Domestic Operation of India.

Recent Development Under AAI:

India became the first South East Asia to adopt the Automatic Dependence
Surveillance System (ADSS) when AAI installed it at Chennai and Kolkata air traffic control
centers. This technology allows for satellite-based air traffic control over maritime regions.
At the airports in Mumbai, Delhi, and Ahmedabad, Performance Based Navigation (PBN)
processes have already been implemented. In technological cooperation with the Indian
Space Research Organisation, AAI is carrying out the GAGAN project (ISRO). The
navigation signals obtained from the GPS will be supplemented to meet the maritime needs
of aircraft. The system's initial phase of development was finished in February 2008.

4. Bureau of Civil Aviation Security (BCAS)

It is the Regulatory authority body for Civil Aviation in India. It is responsible for
maintaining, developing, and implementing the security plan for national civil Aviation.

5. Airports Economic Regulatory Authority (AERA).

Airports Economic Regulatory Authority (AERA) is a regulatory agency under the
Government of India that regulates tariffs and other airport expenditures and fees. The
Airports Economic Regulatory Authority of India Act (AERA) of 2008 established it as a
statutory body. It operates under the provisions of the AERA Act of 2008.
 Aviation Pricing Mechanism

Factors affecting Indian aviation prices.

1. Price sensitivity of Indian customers

Indian customers are the most price sensitive in the world. We prefer a flight at 3 am
if we save 1000 bucks. For this reason, Indigo Airlines in India have the highest market share
at 55%. Being a low-cost carrier, Indigo can cut costs, offers primary facility, and charge
accordingly.

2. Widespread network of railways

India has a vast network of railways, unlike the USA. Name the place, and you will
find a way to travel by train, even to the remotest part of the country. Indian Government
tactically keeps the ticket prices of Indian railways at a highly reasonable level to prevent the
aviation sector's oligopoly from playing with prices as they like. The availability of
Government regulated Indian railways keeps a price ceiling in most economy class airlines if
booked in a comfortable time. Thus, with the help of railway prices, the Government can
keep track of airline prices.

3. Dynamic pricing mechanism

Apart from the above factors, prices are controlled by the factors of demand and
supply.
Initially, there are a lot of empty seats and less demand (when we look at faraway dates), so
the price of tickets is low. But, as the day passes and we reach close to the flight date
(booking just 2-3 days in advance), the number of seats left is less, and the demand for last-
minute buyers is high. In such a scenario, the price increases towards the end.
Look at the pictures below.
The closer the flying date, the higher the price and the farther the date, the lower is price.
Thus, the aviation sector follows a dynamic pricing mechanism that changes daily according
to demand and supplies. Consumer price elasticity is somewhat low to a particular level in
aviation. So, the companies plan to capitalize on consumers' willingness to pay.

4.Choice of Aircraft/Airline
Pricing depends on the type of airline, whether it is a full-service carrier or a low-cost
carrier.
In the case of a full-service carrier, it has all the fancy facilities like an onboard TV screen,
free food, large seats, free drinks, and other freebies, as was the case with the kingfisher. In
contrast, a low-cost carrier only has basic facilities like a semi-comfortable chair with little
leg space; of course, you can avail other services by paying extra, but they aren't available to
all flyers at large.
Understandably the cost of maintaining an FSC will be higher than that of an LCC, and so is
the prices charged. Any FSC will charge higher fees than an LCC.
5. Distance of the trip
Another factor that determines prices is distance travel. The farther the distance, the more the cost to
the airline, due to fuel prices, staff charges, etc., and as the cost increases, the fees charged to
consumers increase.

6. Seasonality
Seasonality also plays a crucial role in deterring prices. Some places in the world are known
to be populated by tourists during a specific time of year, for example, Goa during Christmas
and New year. So, depending on the season, one can expect a drastic prices spike in flight
prices. Here also, dynamic pricing comes into play wherein the factors of demand and supply
are in play. Similarly, in the case of summer, winter, or any holiday like Diwali, the prices of
tickets go up.

All these factors, combined with competitors' actions, play a crucial role in deterring aviation
prices.
 EXTERNALITIES
Externalities are those consequences of the aviation industry that affect third parties
and are not related directly to the transaction occurring.

Externalities are of two types:

1. Positive externality- The third party benefits when a transaction occurs.

2. Negative externality- When the third party incurs a cost by the industry transaction.

Flights Airport access Terminal and ground operation Associated projects

Externalities
Operation Construction Operation Construction Operation Construction Operation

Air pollution - - -

Noise pollution - - - -

Water pollution - -

Climate change - - -

Water use - -

Heritage - - - - -

Land take - - -

Traffic - - - - - -

Trade and Connectivity + + + + +

Risk and public safety - -

zones
The social cost to - - -
nearby communities
Tourism +

Employment and + + + + +
economic benefits
Biodiversity impacts - - - - - -

Rapid response to + +
disasters

Table (): Externalities with their impacts on third parties negative impact (-) positive
impact (+)
Air Pollution:

• The aviation industry contributes to air pollution by multiple sources; CO2 tops it all
as 2.1% of the total human-induced Carbon dioxide (CO2) emissions are produced by
the global airline industry.
• The maintenance of the terminals, hangers, and aircraft use compound chemicals that
release volatile organic compounds.
• Vehicles used for airport access and ground operations generate pollutants through the
burning of fuels.
• The construction projects related to airports also emit dust and particulate matter.

Noise Pollution:

Noise pollution is annoying and easily perceived environmental impact on the

aviation industry. The noise polluted is not limited to the one generated during take-
off/landing of aircraft and the traffic moving to and fro of the airports but also extends
to the reverse thrust, engine tests, and construction noise. The impact of noise
pollution depends on several factors like duration, time of the day, noise frequency,
and location.

Noise pollution can be reduced significantly by

1. Implementation of strict regulations by the authority and constraints on the
travel routes followed
2. Research and development to control noise generated
3. Restricting construction and planning permissions where noise levels are
critical.

Water pollution:
Construction works may lead to polluted runoffs into nearby waterbodies. Secondly,
when there are heavy rains, the de-icing agents used on runways and other chemicals exposed
to rains tend to run off into drains. If improper measures are taken, it may lead to polluting
the waterbodies or the groundwater. Wastewater from operations at the airport goes to the
sewage plant, which may be at its near capacity, and upgradation is needed, but in some
cases, it's not possible.
Water pollution can be minimized by taking appropriate measures like using eco-friendly
chemicals and de-icing agents, improving environment management systems, and
maintaining drainage and sewage systems.

Climate Change:

Higher levels of greenhouse gases lead to a higher level of climate change. The
aviation industry majorly generates greenhouse gases in the following ways,

1. Flights emit large quantities of carbon dioxide and nitrogen oxides, which
react to the ozone concentrations resulting in global warming.
2. The emissions from vehicles in and around airports generate C02.
3. Electricity and heating are airport buildings that are procured from the
combustion of fossil fuels.

Water Usage:

Airport-related development and airport construction require water for mixing

cement, cleaning, etc. Operations of these developments involve toilet flushing, food
preparation, fire drills, cleaning of aircraft and airports, etc. Over usage of water can cause
problems of drought and have an impact on ecological habitats. Water usage can be reduced
by following methods like rainwater harvesting.

Heritage:

Assets of heritage include archaeological remains that are both buried and above
ground and historical buildings. These heritage assets can be affected by the vibrations
produced by the aircraft and the traffic. The building materials can lose a life, and historical
vegetation and plantations can be harmed due to the air pollution caused. The land around the
heritage sites can be eroded, and they cannot be viewed in the same context.

Carrying out proper geological and archaeological surveys will reduce the loss. Keeping
construction records and characters along with design amendments will help preserve
heritage.
Land take:

Acquiring land can lead to the loss of wildlife habitats and land that can be cultivated.
The land can otherwise be used for community service, houses, playing fields, etc. Loss of
agricultural land would lead to a reduction in food supplies; hence the government should
promote the protection of the best land.

Traffic:

Congestion and severance can be caused by traffic. Congestion occurs when the road
and junction carrying capacity is exceeded. In contrast, severance occurs when there is a split
among communities due to traffic. Severance is of two types; one is dynamic severance,
which occurs when it is difficult to cross roads because of the traffic, and the other is static
severance when new roads split a community.

Trade and connectivity:

When flights are connected between two regions, trade between the two regions in
increased, and goods and services are exchanged. Roads and networks developed help in easy
travel and connectivity get stronger, facilitated by the flow of goods, people, services, and
knowledge ensuring economic growth within the region.

The social cost to nearby communities:

While air travelers eat the fruit of aviation and airport-related development, the
communities residing in its vicinity face negative impacts.

Airport-related workers usually rent homes nearby, so it's easy for them to commute; as a
result, there is lesser community participation because of their long working hours. The
owners who rent their homes complain about the homes and gardens not being maintained.
The house’s value also drops because of the landscape, noise, and other impacts from the
airport. This means lesser people opt to buy homes in this area, resulting in lower population
density.

Tourism:

With the ease of travel, people tend to travel more, and with more travel comes an
urge to visit new and exciting places around the globe. The tourism sector enjoys the benefits
provided by the aviation industry. Tourism, in turn, brings in development and employment.
Employment and economic benefits:

Employment is generated when goods and services are provided to the direct and
induced activities of the airport. Advertising, cleaning, retailing, food, IT, construction, and
fuel are a few examples where employment and economic growth are observed. With
growing employment and development, the economy also gets more robust.

Biodiversity impacts:

The aviation industry takes a toll on flora, fauna, and nature. The following impacts
are as below:

• When airports and airport access routes have developed, the animals with breeding
and foraging pattern are affected. When animals continue moving in the same pattern,
they may be hit by cars and have a habitat loss.
• Because of degradation in habitat, the attractiveness of habitat is reduced for flora
and fauna, resulting in clearance of vegetation or replacement with another type of
vegetation.
• Birds are struck down by flights during landing and take-offs. As birds move away
from such areas, they are prone to expose themselves to predators.

Rapid response to disasters:

When a disaster occurs, it requires a rapid response, and quick action needs to be
taken to minimize the loss caused. With flights, we can provide short supplies and aid
required, saving lives, evacuating, and reaching isolated areas where other means of transport
fall short.
 Conclusion-

One of India's industries with the fastest growth rates in aviation. India is currently ranked as
the third-largest domestic market for civil aviation worldwide. It was predicted by the
International Air Transport Association (IATA) that by 2026, the nation would overtake the
UK and take over the second spot.

Our Opinion
In the past three years, civil and military aviation in India has significantly transitioned. The
industry's employment opportunities are rapidly expanding, making this the ideal time for
people who want to pursue a career in the aviation sector. To learn more about the future of
the civil aviation industry, read the article.

The rise in air travel:

According to the most recent report on civil aviation, plane traffic will increase generally.
Today, compared to the previous few years, aeroplanes carry significantly more people and a
greater volume of cargo and mail. This suggests that the future of civil aviation is promising.
Investments:

A significant flow of private player investments is anticipated in the aviation sector. There
will likely be 800 aircraft in the skies by the year 2020. The low penetration rate offers a
significant investment opportunity in the Indian aviation industry.

Defence:

Because aviation is both a crucial component of the defence organization and a

crucial medium of communication during peacetime, the State cannot ignore the
correct development of the industry.

Popularity

Domestic air travel will likely become more commonplace and more popular than it is in the
near future. The current demand for the aviation sector foretells the future's tangible reality.

Favourable weather:

India's constant favourable weather conditions would help the aviation industry flourish
tremendously. For the industry to contribute to the overall development that India intends for
its people, the government is implementing various steps to support industry growth.

Due to their rapid expansion, the airline industry is looking for qualified individuals who
meet their employment requirements to carry out numerous activities for their business.

Covid Impact:

In India, the growth of air travel is projected to be 59% each year by 2022. Even so, it falls
short of 40% of the available levels. According to a study by the rating agency ICRA, ATF
expenses, which have climbed by 93% yearly due to the geopolitical upheaval in Russia and
Ukraine, will continue to be a burden for the company in the foreseeable future a significant
element in its profitability.
The industry is currently struggling due to the rising ATF prices, which also pose a
significant risk to the industry's profitability in the fiscal year 2023.

Recently, the government declared that the ECLGS (emergency credit line guarantee scheme)
would be extended for another year; as a support measure for the Indian aviation industry, it
increased the quantity of help, decreased the cost of funds, and lowered the price of funds for
accessing non-fund-based restrictions.
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