Credit: DH File Photo
New Delhi: Indian airlines and plane makers Boeing and Airbus will reveal new orders this week and showcase large jets as they look to cash in on a boom in a fast-growing aviation market with a greater focus on international routes.
As India sets its sights on becoming a regional aviation hub to rival Dubai and Singapore, the Wings India event in its southern city of Hyderabad, running from Thursday to Sunday, is set to draw representatives of lessors and government as well.
"Air traffic, airports and fleet size are going to grow at a double-digit growth annually in years to come," the Civil Aviation Minister Jyotiraditya Scindia, told Reuters last week in response to a question on industry growth.
Although India is now the world's fastest-growing aviation market, with travel demand outstripping the supply of planes, the bulk of international traffic is captured by global carriers such as Emirates.
India's newest airline Akasa, due to start international flights in 2024, is expected to announce an order for about 150 Boeing 737 MAX narrowbody planes at this week's aviation show, adding to recent record orders by bigger rivals.
It was not immediately clear if Akasa's order included Boeing's controversial 737 Max 9 planes, after a cabin panel blowout this month put the planemaker in regulators' crosshairs, adding to its safety crises.
Indian commercial airlines do not currently operate the 737 Max 9 aircraft.
The activity comes despite the financial struggles of two budget carriers GoFirst and SpiceJet, in the wake of the collapse of two other Indian airlines since 2011.
However, bankruptcies were a "thing of the past" and the growth of smaller regional airlines and government incentives to carriers to fly to smaller towns has sparked an industry boom, Scindia added.
India is investing close to Rs 99,675 crore ($12 billion) in building new airports and refurbishing existing ones, aiming to have about 200 airports within five years, up from 150 today.
Domestic passenger traffic is expected to surge to 350 million by 2030, from 152 million in 2023, while international travelers will grow to 160 million, data from aviation consultancy CAPA India and the government shows.
India has a fleet of about 700 aircraft, with orders pending for more than 1,500 planes by IndiGo, Air India and Akasa.
The figure points to the market's appetite for growth, especially in the long-haul segment as international air travel increasingly comes into focus, Remi Maillard, managing director of Airbus India and South Asia, told Reuters.
At the Hyderabad event, Air India's first Airbus A350 will be on display, alongside the world's largest twin-engine passenger jet, the Boeing 777-9.
They are part of the Indian airline's recent order book and will operate on its international network.
But many planes are also being ordered for the domestic market, risking an oversupply in the near term, that could make it tough for airlines to make money amid intense competition, analysts have warned.
Other risks to growth include snags with engines, and a shortage of pilots that could be worsened by government plans to curb flying times following protests about fatigue.
"Indian airlines will have a very busy 2024 on the international front, but we expect that the impact on financials may also be visible," CAPA India said in a recent note.