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Taking off: How India's aviation industry is soaring Taking off: How India's aviation industry is soaring
(about 2 hours later)
By Ben Richardson Editor, BBC India Business ReportBy Ben Richardson Editor, BBC India Business Report
Indian airports dealt with 10.7m passengers in October 2009Indian airports dealt with 10.7m passengers in October 2009
In a leafy Indian garden, Captain Anil Gadgil goes through the final flight checks and fires up his jet motors.In a leafy Indian garden, Captain Anil Gadgil goes through the final flight checks and fires up his jet motors.
As they whine into life, his fingers flick switches and push buttons, the control panel blinking a reassuring response.As they whine into life, his fingers flick switches and push buttons, the control panel blinking a reassuring response.
The tarmac runway of Mumbai's international airport stretches out in front of him, which is odd as we are sitting on the back of a small truck more than a 100 miles from the city, and any attempt to take off would put us firmly into the next door neighbour's front room.The tarmac runway of Mumbai's international airport stretches out in front of him, which is odd as we are sitting on the back of a small truck more than a 100 miles from the city, and any attempt to take off would put us firmly into the next door neighbour's front room.
Today, in India, hundreds and hundreds of people who have never flown are coming to the aviation industry Captain Anil Gadgil, Jeet AerospaceToday, in India, hundreds and hundreds of people who have never flown are coming to the aviation industry Captain Anil Gadgil, Jeet Aerospace
But Capt Gadgil is unconcerned, and turns round to explain the motivation behind his self-designed mobile flight simulator and aviation academy.But Capt Gadgil is unconcerned, and turns round to explain the motivation behind his self-designed mobile flight simulator and aviation academy.
"No matter what the economy says, no matter what the jobs market is, a youngster will always want to fly," he says."No matter what the economy says, no matter what the jobs market is, a youngster will always want to fly," he says.
"There is always a thrill about this kind of career and many youngsters are looking for it.""There is always a thrill about this kind of career and many youngsters are looking for it."
'Inspire and train''Inspire and train'
Capt Gadgil and his wife Kavita set up Jeet Aerospace in 1991 after their son Abishek was killed during a training flight with the Indian Air Force. Capt Gadgil and his wife Kavita set up Jeet Aerospace in 1991 after their son Abhijit was killed during a training flight with the Indian Air Force.
Anil Gadgil set up Jeet Aerospace in 1991 after the death of his sonAnil Gadgil set up Jeet Aerospace in 1991 after the death of his son
Operating out of Pune, Maharashtra's second-biggest city after Mumbai, it aims to inspire and help train the next generation of commercial and defence pilots, and to cut the accident rate that was, at the time, robbing the country of some of its best flyers.Operating out of Pune, Maharashtra's second-biggest city after Mumbai, it aims to inspire and help train the next generation of commercial and defence pilots, and to cut the accident rate that was, at the time, robbing the country of some of its best flyers.
And while the simulator has helped them achieve many of their goals, it has also given them a unique insight into the way India's aviation industry is developing.And while the simulator has helped them achieve many of their goals, it has also given them a unique insight into the way India's aviation industry is developing.
"Today, in India, hundreds and hundreds of people who have never flown are coming to the aviation industry," Capt Gadgil explains."Today, in India, hundreds and hundreds of people who have never flown are coming to the aviation industry," Capt Gadgil explains.
"They are attracted to the industry, not just for flying, but for many other jobs."They are attracted to the industry, not just for flying, but for many other jobs.
"I don't think we will see a very quick boom. It's going to be slow, but it's going to be steady and there is a huge market waiting to open up.""I don't think we will see a very quick boom. It's going to be slow, but it's going to be steady and there is a huge market waiting to open up."
We are developing the small hub and spoke airports by which we can create a network of airports across the length and breadth of the country to facilitate our economy Deepak Shastri, Airports Authority of IndiaWe are developing the small hub and spoke airports by which we can create a network of airports across the length and breadth of the country to facilitate our economy Deepak Shastri, Airports Authority of India
The most recent figures seem to back up his view, though the boom may be arriving a little quicker than he expected.The most recent figures seem to back up his view, though the boom may be arriving a little quicker than he expected.
According to the Airports Authority of India, the total number of domestic and international passengers was 10.7 million in October 2009, up 23% on the same month a year earlier.According to the Airports Authority of India, the total number of domestic and international passengers was 10.7 million in October 2009, up 23% on the same month a year earlier.
Aircraft movements climbed by almost 59% in the same period.Aircraft movements climbed by almost 59% in the same period.
At a time when many of the world's other airline markets and carriers are going through some of their toughest ever months, this sort of growth jars as freakish and unsustainable.At a time when many of the world's other airline markets and carriers are going through some of their toughest ever months, this sort of growth jars as freakish and unsustainable.
But for Deepak Shastri, the director of Pune's international airport, there are a number of very good economic and business reasons why India should be seen as unique in terms of its aviation industry development.But for Deepak Shastri, the director of Pune's international airport, there are a number of very good economic and business reasons why India should be seen as unique in terms of its aviation industry development.
Planes versus trainsPlanes versus trains
Sitting in his office at the airport, the sounds and dust of building work filling the air, Mr Shastri explains that today only a tiny percentage of India's more than 1 billion population flies.Sitting in his office at the airport, the sounds and dust of building work filling the air, Mr Shastri explains that today only a tiny percentage of India's more than 1 billion population flies.
Train travel in India is more popular than going by planeTrain travel in India is more popular than going by plane
Most still use the cheaper, though slower, option of the train to traverse this massive country.Most still use the cheaper, though slower, option of the train to traverse this massive country.
As a result, he says that India will not be dependent on international flights or foreign tourists for growth, and can rely on the expansion of its internal market, which is being driven by economic growth of more than 7%.As a result, he says that India will not be dependent on international flights or foreign tourists for growth, and can rely on the expansion of its internal market, which is being driven by economic growth of more than 7%.
Also, the issues that have plagued many of the world's airlines, such as high fuel costs, declining passenger numbers, and cut-throat price wars have had a more limited impact in India.Also, the issues that have plagued many of the world's airlines, such as high fuel costs, declining passenger numbers, and cut-throat price wars have had a more limited impact in India.
Low-cost carriers such as Spicejet have had to price competitively and are still making a loss, but that shortfall has narrowed in the most recent earnings figures and the company is predicting a return to profits in the financial year 2009/2010.Low-cost carriers such as Spicejet have had to price competitively and are still making a loss, but that shortfall has narrowed in the most recent earnings figures and the company is predicting a return to profits in the financial year 2009/2010.
Many of the full-service companies such as Air India are in the process of reworking their business plans and analysts forecast that while some of them are still losing millions of dollars a day, they will be in a better shape once the changes are made.Many of the full-service companies such as Air India are in the process of reworking their business plans and analysts forecast that while some of them are still losing millions of dollars a day, they will be in a better shape once the changes are made.
Airport expansionAirport expansion
For Deepak Shastri, the future is not in doubt and he is taking steps to prepare for the boom in air travel that he believes is only a matter of time.For Deepak Shastri, the future is not in doubt and he is taking steps to prepare for the boom in air travel that he believes is only a matter of time.
He explains that at Pune airport they have grown in size from 4,000 square metres to 12,000 square meters, has doubled the number of passengers it can handle, and has increased its plane parking bays from four to eight.He explains that at Pune airport they have grown in size from 4,000 square metres to 12,000 square meters, has doubled the number of passengers it can handle, and has increased its plane parking bays from four to eight.
Deepak Shastri is the director of Pune's international airportDeepak Shastri is the director of Pune's international airport
The next step is to build a brand new airport that will allow them to meet the increasing numbers of passengers looking to fly to and from Pune, which he expects to rise from 2 million to 2.5 million in the next financial year.The next step is to build a brand new airport that will allow them to meet the increasing numbers of passengers looking to fly to and from Pune, which he expects to rise from 2 million to 2.5 million in the next financial year.
Mr Shastri, who also works for the state-run Airports Authority of India, explains that his ambitions for Pune are matched nationwide by the government, which views the industry as a driver of development and not just a consequence of an expanding economy and rising consumer demand.Mr Shastri, who also works for the state-run Airports Authority of India, explains that his ambitions for Pune are matched nationwide by the government, which views the industry as a driver of development and not just a consequence of an expanding economy and rising consumer demand.
Seeing the past trends, the way in which demand has increased especially in the domestic market, we see a lot of growth Anirudha Thete, Altos ElectronicsSeeing the past trends, the way in which demand has increased especially in the domestic market, we see a lot of growth Anirudha Thete, Altos Electronics
In the next 10 years India has "very ambitious plans of investment in large numbers through different business models," he says, adding it will include government funding, public and private partnership systems, and private financing.In the next 10 years India has "very ambitious plans of investment in large numbers through different business models," he says, adding it will include government funding, public and private partnership systems, and private financing.
"We are developing green field airports and brown field airports," he continues."We are developing green field airports and brown field airports," he continues.
"And we are developing the small hub and spoke airports by which we can create a network of airports across the length and breadth of the country to facilitate our economy.""And we are developing the small hub and spoke airports by which we can create a network of airports across the length and breadth of the country to facilitate our economy."
TechnologyTechnology
One company that is directly benefitting from the growth in the airline industry is Altos Electronics.One company that is directly benefitting from the growth in the airline industry is Altos Electronics.
Altos Electronics exports to the UK and the Gulf statesAltos Electronics exports to the UK and the Gulf states
Based in their new factory down a road that threatens to loosen your fillings and remove chunks of your car, the firm makes aviation warning lights that are placed on structures such as tall buildings and antennas.Based in their new factory down a road that threatens to loosen your fillings and remove chunks of your car, the firm makes aviation warning lights that are placed on structures such as tall buildings and antennas.
An exporter to the UK and the Gulf states, company boss Anirudha Thete says he can draw a direct comparison with the way India is performing when compared to other countries worldwide.An exporter to the UK and the Gulf states, company boss Anirudha Thete says he can draw a direct comparison with the way India is performing when compared to other countries worldwide.
"As the aviation industry grows, naturally the demand for our products will increase," he says as his workers solder and assemble the light emitting diodes and motherboards that are central to the company's flashing lamps."As the aviation industry grows, naturally the demand for our products will increase," he says as his workers solder and assemble the light emitting diodes and motherboards that are central to the company's flashing lamps.
Mr Thete explains that demand for his products has tripled in the past years, and while domestic sales are still climbing, exports to the UK have dropped by 50% over the past year, reflecting the tougher times the British economy faces.Mr Thete explains that demand for his products has tripled in the past years, and while domestic sales are still climbing, exports to the UK have dropped by 50% over the past year, reflecting the tougher times the British economy faces.
"Seeing the past trends, the way in which demand has increased especially in the domestic market, we see a lot of growth," he says."Seeing the past trends, the way in which demand has increased especially in the domestic market, we see a lot of growth," he says.
He's not the only one. The question now is if India's aviation industry can live up to the hype and expectations that are surrounding it.He's not the only one. The question now is if India's aviation industry can live up to the hype and expectations that are surrounding it.
Or if it will continue to be a market with huge potential just waiting to take off.Or if it will continue to be a market with huge potential just waiting to take off.