When air travel becomes affordable and available to all Indians

Updated: Nov 13 2005, 05:30am hrs
I have watched with fascination (and to a limited extent participated in) the progressive liberalisation of the Indian economy and with it, that of the Indian civil aviation industry since the early 1990s. This process of liberalisation has slowly, but surely, unleashed a vast potential travel market, both for business and tourism, and an opportunity to travel by air for increasingly larger segments of the Indian population.

I am indeed delighted that the Indian policy makers have fully recognised the huge contribution that the expansion of air connectivity, both within India and with other countries worldwide, makes to the growth of the Indian economy, in generating employment and developing subsidiary industries.

Earlier this year, the World Travel and Tourism Council estimated that currently the Indian travel and tourism industry, directly and indirectly, accounts for 5.5% of the country's total employment and 5.3% of the country's GDP.

The opportunities available need to be viewed in conjunction with several aspects of the growth that are taking place in other segments of the Indian economy and society. India is fast emerging as a centre of financial and economic activity, a base for doing jobs for other countries at lower costs. Notwithstanding the current shortages, I see an enormous scope for India, in the long run, to be an exporter of technically qualified and trained personnel for the aviation industry, e.g. aircraft maintenance and avionics engineers, pilots and technicians. But to be able to do this successfully, the country will need to build many more schools and training academies and set up new training facilities that are truly centres of excellence, so that India can become the centre for meeting the needs of qualified and trained personnel worldwide.

I do not need to emphasise how small a proportion of my fellow Indians today (or indeed ever) have travelled by air. I know that we must take cognizance of the ground reality, that the vast majority of us are not as yet economically empowered to be able to even think about such possibilities. Nevertheless, even if we were to restrict ourselves to the affluent middle-class and upwardly mobile segment of the Indian population of probably more than 300 million, the present size of the Indian air travel market of around 18-19 million passengers is clearly a miniscule portion of the total available market.

In fact, when you take into account the travel cycle of the average domestic passenger, particularly the Indian business traveller who constitutes between two-thirds and three-fourths of the total air travel market of around at least three one-way trips per year, the number of individuals travelling by air within India works out to only around 6 million.

The opportunities are, therefore, vast and the successive governments in recent times have given due recognition to the need to implement policies and create an environment that promotes and assists in the growth of the Indian aviation industry. The policies also give recognition to the need to simultaneously create opportunities for the rapid integration of the Indian civil aviation industry in the global air transportation industry.

The government's policy decision early this year to allow privately-owned Indian carriers to operate in the highly competitive and rapidly expanding international travel market into and out of India is also a step in the right direction.

Supported by the progressive liberalisation of India's Air Services Agreements with other countries, this policy will go a long way in making the Indian carriers more competitive with the well established foreign carriers serving the Indian market, improving the air links between India and the rest of the world and contributing significantly to the promotion of tourism into India.

That this is really important for the country does not need any reiteration, more so when we recognise that the foreign tourist inflows into India were only around 4 million in the FY 2005 and that around 3/4th of the passenger traffic to and from India is being carried by foreign carriers like British Airways, Lufthansa, Singapore Airlines, Emirates, etc. I firmly believe that the coordinated and parallel marketing efforts of Air India and Indian Airlines and the privately-owned domestic carriers will enable our country to regain its rightful share of the air travel market into and out of India and assist the Tourism Ministry's promotional efforts in the growth of in-bound tourism.

For all these policy initiatives to succeed, however, it is extremely important for the parallel efforts initiated by the government to modernise and improve the supporting infrastructure to be pursued on a war footing and completed in the shortest possible time. We have the distinct advantage of adopting the best features of all the new airports and terminals that have been built all over the world in recent years whilst designing and building the new facilities in our country for example, the new airports in Hong Kong, Kuala Lumpur and of course, Singapore and Dubai, to name only a few.

We don't need to reinvent the wheel, and we surely have enough talent in our country to design, develop and build the best world-class facilities. Equally important is the need for the policy makers to recognise that the Indian aviation industry faces crippling and very high input costs and that unless urgent and active steps are taken to reduce the tax burdens, improve the productive use of the limited resources that are available and thereby bring the cost structures in line with those prevailing worldwide and in neighboring peer countries, the dream that I have talked of earlier of making air travel affordable to a significantly larger number of my fellow countrymen may never materialise. I strongly urge the government to recognise the role that it has to play to be able to fulfill its own policy objectives, in partnership with the private sector and with the active participation of all the players in the travel and tourism industry.

India has a long way to go to be able to come anywhere close to reaching international standards in large segments of the travel and tourism industry. What is encouraging, however, is that all of us have at last woken up to the potential and the possibilities and that slowly, but surely, we are jointly marching towards achieving the goal. No longer is air travel regarded as elitist or the domain of only the privileged or an industry that must cross subsidise other economic activities and modes of travel.

For me, the empowerment of India in the travel and tourism segment will only have taken place when the Indian carriers have demonstrated to the world the standards and qualities of performance that India is capable of; when we have developed India as an entrepoint for international cargo traffic flows by air; when the Indian carriers have succeeded in developing many more tourist destinations in India and in selling India to the world, making it a competitive and attractive destination for shopping and exporting Indian culture worldwide in other words, making India known for its new spirit, for its entrepreneurship rather than its apparent poverty, grime and dirt.

I am very optimistic that we will succeed, that the right environment is being created graduallythough it needs to be speeded upand that the travel and tourism industry will be an important engine for the growth and progress of India, in particular for the creation of additional jobs and in bringing the country together. There are many crucial areas that need to be tackled. I am confident that we will do this successfully and that we will win the battles and also the war. For me personally, it will not be, as Shakespeare wrote, 'love's labour lost'but rather 'love's labour regained.