Latest news with #AbhijithGanapavaram
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11 hours ago
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Modi's soaring Indian aviation ambitions face many headwinds
By Abhijith Ganapavaram and Nandan Mandayam NEW DELHI (Reuters) - Prime Minister Narendra Modi's high-profile attendance at a global airlines conference this week underscores how much India is banking on a boom in aviation to support wider development goals, but headwinds to its ambitions are gathering force. Undeterred by the uncertainty gripping the aviation sector globally due to trade tensions and shaky consumer confidence, India's biggest airlines are ploughing ahead with orders for new planes, following record deals two years ago. However, the rapid pace of growth risks losing steam if plane shortages, infrastructure challenges and taxation issues are not addressed, industry officials warned at the International Air Transport Association's annual meeting. Hostilities with neighbour Pakistan are also causing Indian airlines to take large, expensive detours around Pakistani airspace, requiring more fuel and passenger care. Carriers have asked the Indian government to waive some fees and provide tax exemptions, people familiar with the matter have told Reuters, but it is not clear if it will provide any help, despite its high-flying rhetoric. New Delhi says it wants India to be a job-creating global aviation hub along the lines of Dubai, which currently handles much of India's international traffic. "In the coming years, the aviation sector is expected to be at the centre of massive transformation and innovation, and India is ready to embrace these possibilities," Modi told global aviation leaders on Monday. But the transformation will require billions of dollars of investment in airports and industry supply chains, and a revamp of regulations, industry officials said. PUNCHING BELOW ITS WEIGHT The numbers look promising. IATA forecasts passenger traffic in India will triple over the next 20 years and the country has set a target of increasing the number of airports to as many as 400 by 2047, up from 157 in 2024. "We are fast emerging as a strategic connector country ... India is a natural connector of the skies and aviation as well," India's Civil Aviation minister Ram Mohan Naidu told global airline CEOs in New Delhi. Already the world's third-largest aviation market by seats after the U.S. and China, there is significant potential for India to grow. The world's most populous nation, India accounts for around 17.8% of people but only 4.2% of global air passengers, according to IATA. A record 174 million Indian domestic and international passengers flew in 2024, compared to 730 million in China, IATA data shows. "The outlook is potentially a very positive one for both the Indian economy and air transport industry. However, such outcomes are not guaranteed," IATA said in a report on the Indian market. Industry executives and analysts said more work lies ahead in scaling aviation-related infrastructure, updating rules, lowering taxes and making life easier for airlines. "Even the regulators will agree that they need to update their regulation, because there is a reason why India is not punching above its weight. In fact, it is punching very much below its weight," Association of Asia Pacific Airlines Director General Subhas Menon said. Dubai-based Emirates, for example, says capacity restrictions on foreign airlines need to be relaxed for the industry to reach its full growth potential. "For every seat we offer, particularly in the peaks, we've got three to 10 people trying to get it," Emirates President Tim Clark told reporters. Among other problems, India lacks enough domestic maintenance, repair and overhaul facilities to care for its fleet, making it overly dependent on foreign shops at a time of stiff competition for repair slots, particularly for engines. Global airlines have aircraft sitting on the ground because there aren't enough facilities available for servicing them, IATA Director General Willie Walsh said. "I think airframe maintenance is a huge opportunity for India because you require labour and you require skills. And that's something that I know India is investing in," Walsh said, in response to a Reuters question at a press conference. Airline growth globally is being tempered by extended delays to deliveries of new, more fuel-efficient planes due to supply chain issues. India's largest airline IndiGo has been leasing aircraft to allow it to expand internationally while it waits for new planes. This week it partnered with Air France-KLM, Virgin Atlantic and Delta to extend the reach of IndiGo tickets using those airlines' networks.
Yahoo
13 hours ago
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Modi's soaring Indian aviation ambitions face many headwinds
By Abhijith Ganapavaram and Nandan Mandayam NEW DELHI (Reuters) - Prime Minister Narendra Modi's high-profile attendance at a global airlines conference this week underscores how much India is banking on a boom in aviation to support wider development goals, but headwinds to its ambitions are gathering force. Undeterred by the uncertainty gripping the aviation sector globally due to trade tensions and shaky consumer confidence, India's biggest airlines are ploughing ahead with orders for new planes, following record deals two years ago. However, the rapid pace of growth risks losing steam if plane shortages, infrastructure challenges and taxation issues are not addressed, industry officials warned at the International Air Transport Association's annual meeting. Hostilities with neighbour Pakistan are also causing Indian airlines to take large, expensive detours around Pakistani airspace, requiring more fuel and passenger care. Carriers have asked the Indian government to waive some fees and provide tax exemptions, people familiar with the matter have told Reuters, but it is not clear if it will provide any help, despite its high-flying rhetoric. New Delhi says it wants India to be a job-creating global aviation hub along the lines of Dubai, which currently handles much of India's international traffic. "In the coming years, the aviation sector is expected to be at the centre of massive transformation and innovation, and India is ready to embrace these possibilities," Modi told global aviation leaders on Monday. But the transformation will require billions of dollars of investment in airports and industry supply chains, and a revamp of regulations, industry officials said. PUNCHING BELOW ITS WEIGHT The numbers look promising. IATA forecasts passenger traffic in India will triple over the next 20 years and the country has set a target of increasing the number of airports to as many as 400 by 2047, up from 157 in 2024. "We are fast emerging as a strategic connector country ... India is a natural connector of the skies and aviation as well," India's Civil Aviation minister Ram Mohan Naidu told global airline CEOs in New Delhi. Already the world's third-largest aviation market by seats after the U.S. and China, there is significant potential for India to grow. The world's most populous nation, India accounts for around 17.8% of people but only 4.2% of global air passengers, according to IATA. A record 174 million Indian domestic and international passengers flew in 2024, compared to 730 million in China, IATA data shows. "The outlook is potentially a very positive one for both the Indian economy and air transport industry. However, such outcomes are not guaranteed," IATA said in a report on the Indian market. Industry executives and analysts said more work lies ahead in scaling aviation-related infrastructure, updating rules, lowering taxes and making life easier for airlines. "Even the regulators will agree that they need to update their regulation, because there is a reason why India is not punching above its weight. In fact, it is punching very much below its weight," Association of Asia Pacific Airlines Director General Subhas Menon said. Dubai-based Emirates, for example, says capacity restrictions on foreign airlines need to be relaxed for the industry to reach its full growth potential. "For every seat we offer, particularly in the peaks, we've got three to 10 people trying to get it," Emirates President Tim Clark told reporters. Among other problems, India lacks enough domestic maintenance, repair and overhaul facilities to care for its fleet, making it overly dependent on foreign shops at a time of stiff competition for repair slots, particularly for engines. Global airlines have aircraft sitting on the ground because there aren't enough facilities available for servicing them, IATA Director General Willie Walsh said. "I think airframe maintenance is a huge opportunity for India because you require labour and you require skills. And that's something that I know India is investing in," Walsh said, in response to a Reuters question at a press conference. Airline growth globally is being tempered by extended delays to deliveries of new, more fuel-efficient planes due to supply chain issues. India's largest airline IndiGo has been leasing aircraft to allow it to expand internationally while it waits for new planes. This week it partnered with Air France-KLM, Virgin Atlantic and Delta to extend the reach of IndiGo tickets using those airlines' networks. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
2 days ago
- Business
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IndiGo expands network with Air France-KLM, Virgin Atlantic, Delta deal
By Abhijith Ganapavaram NEW DELHI (Reuters) -India's largest airline IndiGo has entered an agreement with Air France-KLM, Virgin Atlantic and Delta to expand its long-haul services to North America, Europe and Britain, the airlines said on Sunday. IndiGo has an extensive domestic network in India, the world's third-largest air passenger market, and is expanding its international reach. Separately IndiGo also said it would convert 30 out of 70 options for Airbus A350 jets into firm orders for new planes. Once the airline partnership is complete, IndiGo will be able to sell flights under its own name on those operated by its partners out of India, and onward travel from Amsterdam and Manchester, UK, on selected flights to Europe and North America. IndiGo will start flying to Amsterdam and Manchester from July. Air France-KLM and Virgin Atlantic already code-share on IndiGo's domestic flights. The Delta partnership is new. U.S. carrier Delta has not flown to India since the pandemic. CEO Ed Bastian told media at an airline summit in New Delhi that Delta will restart direct services from the United States to India over the next couple of years. "There's not a more important market in aviation at the present time than in India," Bastian said. Delta is planning nonstop flights between Atlanta and Delhi, subject to government approval, a joint statement said. IndiGo is hosting the International Air Transport Association's (IATA) annual meeting in New Delhi from Sunday. IndiGo is aiming to grow its fleet to 600 aircraft by 2030, from more than 400 currently, and has been leasing aircraft to tide it over aircraft delivery delays and expand internationally. It recently said it will lease six Boeing 787 wide-body jets from Norse Atlantic Airways by early next year. India's aviation regulator said last week it would only extend an existing leasing arrangement IndiGo has with Turkish Airlines to the end of August. The arrangement has been publicly criticised in India after Turkey came out in support of Pakistan during the recent conflict between the two South Asian neighbours.
Yahoo
4 days ago
- Business
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IndiGo to terminate Turkish Airlines lease deal by end of August after final extension
By Abhijith Ganapavaram NEW DELHI (Reuters) -IndiGo will terminate its leasing agreement with Turkish Airlines by August 31 after India's aviation regulator said on Friday it would only extend the deal for three months, a move that will push the carrier to seek alternatives. The agreement between the two airlines has come under public criticism in India after Turkey came out in support for Pakistan during the recent conflict between the two South Asian neighbours. The pact has also been opposed by IndiGo's rival Air India, which has lobbied the Indian government to end the deal, citing business impact and security concerns, Reuters has previously reported. The Directorate General of Civil Aviation said it had denied IndiGo's request for a six-month extension and approved only three months, citing passenger convenience, confirming an earlier Reuters report. The lease was due to expire on Saturday. The regulator said IndiGo gave an undertaking that it will terminate the lease with state-owned Turkish Airlines by August 31 and will not seek a further extension. IndiGo was not immediately available for comment. It has previously defended the Turkish partnership, saying it offers multiple benefits to Indian travellers and boosts aviation growth and jobs. Turkey's support for Pakistan during the recent conflict has sparked a boycott of Turkish products, including chocolates, coffee and clothing in India. IndiGo has had a codeshare partnership with Turkish Airlines since 2018 and has used that to connect travellers from India to a growing number of destinations in Europe and the U.S. in the last few years, making Istanbul an important hub for India's largest domestic airline. Since 2023, Turkish Airlines has leased to IndiGo two Boeing 777 aircraft with pilots and some crew. The aircraft currently operate on the Delhi-Istanbul and Mumbai-Istanbul routes, allowing IndiGo to carry more passengers, compared with the narrowbodies it operated previously. IndiGo has been leasing aircraft to tide over aircraft delivery delays and expand internationally. The airline expects its first Airbus A350 by early 2027 and the long-range A321XLR this financial year. In the absence of the leased 777s, IndiGo could go back to operating narrowbody aircraft on the two routes, or it could use widebody aircraft it has leased from Norse Atlantic Airways. It could also deploy the XLRs once they are delivered, analysts have said. The regulator's decision to give a limited extension comes after the Indian government earlier this month revoked the security clearance of Turkish ground handling service firm Celebi, citing national security, prompting a lawsuit from the Indian arm of the Turkish firm.
Yahoo
5 days ago
- Business
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Global airlines to address trade war, net-zero uncertainties at annual summit
By Lisa Barrington and Abhijith Ganapavaram NEW DELHI (Reuters) - An unpredictable trade war and daunting environmental targets are on the agenda for global airline bosses at an annual summit in India, as the industry's outlook is clouded by concerns that geopolitical uncertainty will dampen travel demand and raise costs. More people are flying than ever before after a full post-pandemic passenger market recovery, but airlines globally are facing rising cost pressures, extended plane delivery delays, lingering supply chain bottlenecks and falling airfares. On top of this, President Donald Trump's evolving trade war has upended the global aerospace industry's decades-old tariff-free status and added a new layer of volatility and risk. While carriers in Europe and Asia report strong demand for flying, the U.S. airline sector has been hit by a recent slump in travel demand, with carriers struggling to forecast passenger behaviour and operational costs. The influential International Air Transport Association (IATA), which represents more than 300 airlines and over 80% of global air traffic, will hold its annual three-day meeting from Sunday in New Delhi. The summit, hosted by India's largest carrier IndiGo, comes as the world's third-largest air passenger market rapidly expands its aviation industry, and as air travel growth in Asia is expected to outstrip Europe and North America for the next few decades. India's recent hostilities with neighbour Pakistan, which is causing Indian airlines to take large, expensive detours around Pakistani airspace, highlights how conflict zones are an increasing burden on airline operations and profitability. IATA said in February that accidents and incidents related to conflict zones are a top concern for aviation safety requiring urgent global coordination. Aviation safety will also be in focus after a spate of air accidents in Kazakhstan, South Korea and North America over the past six months, and rising concerns about air traffic control systems in the United States. NET-ZERO DOUBTS IATA has increasingly been warning that airlines will not meet their sustainability goals, and that it is not clear how the transition to sustainable aviation fuel (SAF) and new technologies will be financed. Airlines agreed in 2021 to target net-zero emissions in 2050 based mainly on a gradual switch to SAF, which is made from waste oil and biomass and costs more than conventional jet fuel. IATA Director General Willie Walsh has in recent weeks said the industry will need to re-evaluate the commitment. Airlines are being expected to bear the cost of the more expensive fuel and are not getting the support they need from SAF manufacturers, Walsh has said. Delays by Airbus and Boeing in delivering new, more fuel-efficient aircraft are also causing headaches for airlines. IATA said 1 million metric tons of SAF was produced globally in 2024, below forecasts of 1.5 million tons, and described production as disappointingly slow. "Demand for SAF continues to outstrip supply, and costs remain prohibitively high. Regulatory frameworks to encourage SAF production are still underdeveloped, inconsistent, or insufficient," said Subhas Menon, the director general of the Association of Asia Pacific Airlines.
