Riding on the wings: Kerala aviation industry is one of the fastest growing


With four international airports, aviation industry in Kerala has emerged as one of the fastest growing in recent times

With four international airports in the State, the aviation industry in Kerala has emerged as one of the fastest growing in recent times.

Despite many setbacks, including the ban on wide-bodied aircraft at the Calicut airport or the 15-day closure of the Kochi airport due to floods last year, more people are flying, perhaps than those travelling on AC coaches of trains. A major factor, has been the disposable income of the upwardly mobile middle class.

“Moreover, air tariff has come down considerably, be it in the domestic or international sector. Besides, financial and social equalities have opened up options for families like never before,” Rajesh John, an executive of Exodus Vacations, says.

The Kozhikode-based Hamshid Vattatel, a regular flyer in the domestic sector, has been on annual foreign trips with his family for the last three years. “Airfares are now are so cheap. Last year, the return fare from Kochi to Malaysia was just ₹3,200. Low cost flights, excellent tour package, fast visa processing, and security were unthought of a decade ago,” says the 40-year-old.

Emigrant population

With its large emigrant population, Kerala also has the busiest airports in India. A report of the International Air Transport Association (IATA) says about 41% of India’s direct international connectivity are to West Asia — much of it to super-connector hubs of the UAE and Qatar. The UAE leads the way, with almost 20%, followed by Saudi Arabia and the United States, each with just over 9% market share.

The Kochi airport, ranked seventh in the country, handled 1,01,72,839 passengers during 2017-18. The number of passengers handled by Thiruvananthapuram and Calicut was 43,93,469 and 31,39,432 respectively during the last financial year. “The international market is growing more slowly than the domestic sector for various reasons,” an AAI official points out.

An analysis by the Directorate of Civil Aviation from April to November 2018 reveals the total domestic passenger traffic at Kochi was 32,32,804, Thiruvananthapuram 13,30,562, and Calicut 4,39,112. The corresponding figures last year were Kochi 29,86,117, Thiruvananthapuram 12,20,285, and Calicut 3,38,893.

Variations are also seen when international and domestic passengers are taken together. Kochi handled 64,87,257 passengers during April- November 2018, Thiruvananthapuram 30,62,065, and Calicut 22,34,388.

Calicut airport director K. Srinivasa Rao says the domestic sector will open up following the recent decision of the State government to reduce the tax on aviation turbine fuel for domestic flights from 28.7% to 5%.

“More airline companies have evinced interest to operate domestic flights, especially smaller aircraft such as the short-haul ATR to regional destinations, ” he says.

Still many people think air transport is expensive though the aviation industry remains untapped in Kerala. “Of course these are changing with regional connectivity schemes such as UDAN (Ude Desh ka Aam Naagrik) aimed at making air travel affordable to the common man. Incidentally, India, now has 102 operational airports and about 600 commercial aircraft in operation ,” Mr. Rao says.

Liberalised market

But, airline companies say this is not enough for the emerging middle class. The aviation industry is poised for a more liberalised market with the diverging demographic outlooks of India. The total passengers carried by domestic airlines was 114.86 lakh in 2018, Air India (16.29 lakh) and private carriers (99.36 lakh).

The present trends in air transport globally suggest passenger numbers could double to 8.2 billion by 2037. This will also be largely reflected in India as well with the country becoming the third largest market after China and the U.S., overtaking the U.K., Germany and Japan in 2024.

According to IATA, India will add a total of 572 million passengers by 2037. Now India stands seventh with 414 million passengers. The number of domestic airport pairs is 700 (a 50% increase on 2015 levels). Low-cost carriers account for about 70% of domestic seats. “Budget airlines have been the biggest influence when it comes to middle class opting to travel by an aircraft in the domestic sector. Saving time is another factor whether it is business or leisure or education and even group bookings,” says T.K. Sueksh, manager of Akbar Travels.

C.E. Chakkunny, president, Malabar Development Council, says liberalisation of aviation markets will bring middle-class households to the aviation industry. Besides, the public-private partnership (PPP) mode considered for Thiruvananthapuram will be made applicable for Calicut as well in future.

The latest IATA/Tourism Economics (TE) forecasts suggest the demand for air travel to, from, and within India – on an Origin-Destination basis – will increase at an average rate of 6.1% per year over the next 20 years.

The strong demand outcomes over recent years have been partly due to the stimulus of lower airfares. A favourable population and demographic profile – notably a relatively young population – along with the expected continuation of economic development and growth in household incomes underpin this positive long-term outlook.

Middle-class households

It says the number of middle-class households in India is expected to increase to around 20% by 2036, compared with just 2% in 2006.

Air transport, as IATA Economics wing says, is much more than just moving people and cargo from one destination to another. Air transport helps to bring families together, it supports and enhances business and investment decisions, it promotes the transfer of knowledge, and innovation, and provides opportunities to study abroad and experience different cultures.

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Printable version | Dec 7, 2019 8:29:14 PM |

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