In November 2009, according to the Directorate General of Civil Aviation, around 40 lakh passengers travelled on airlines as compared with 30.48 lakh in the same month in 2008. December 2009 has also delivered good news, with both corporate bookings and load factors having taken a decisively upward turn. The latter had dipped to less than 50% when the effect of the global meltdown was peaking in India. But things are clearly turning around now, with analysts expecting a 10-15% surge in domestic air travel in 2010. Before raising a toast to better tidings in the New Year, however, let?s take a quick stock of the lessons of 2009, and whether these remain learnt or not. Air India kept seeking government bailouts without delivering any notable improvements in efficiency, accountability or corporate governance. Its losses are piling up by the day, but salary cuts and the like are being stiffly resisted. The flipside of the 2009 downturn was a relief from the high fuel prices of 2008, but balance sheets across public and private sector companies remained in the red. Striking pilots piled on additional losses, with little penalty. Jet Airways did get good year-end news that its proposal for raising $400 million through a qualified institutional placement was approved. The big 2009 trend was a decisive shift to the low-cost segment, and this was true internationally. Traditional power players like British Airways are now in tough competition with the likes of Ryanair and Easyjet. Low-cost carriers will keep legacy carriers on the backfoot in the new decade, too.
The first decade of the 21st century has seen middle India grow beyond expectations and force a rewrite of various international equations. It has seen the number of Indians boarding planes multiply manifold. Airports have been privatised and modernised. But the pace of infrastructural change simply hasn?t kept up with changes in consumer volume and expectations. Even the site of a second airport for Mumbai continues to be warred over by different government units. A powerful independent regulator hasn?t moved much further from a pipedream, as the Airports Economic Regulatory Authority remains plagued by delays relating to both personnel selection and the monitoring of tariffs and related issues. A minister got into trouble with his crack about the cattle classes, while other Parliamentarians made a big deal about travelling economy. But these were distractions without substance. A decade that saw low-fare airlines really come into their own, beating legacy carriers both in India and abroad, must be followed by one in which the infrastructural and regulatory framework also turns customer-friendly. Given the volatility of oil prices and related factors, middle-class Indians can?t count on fares continuing to go down. But an air universe replete with well-groomed airports, which is also strike-free, that should be theirs by default. This decade.
