Role of Aviation Industry in India GDP

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The Role of Aviation Industry in India GDP in the past few years has been phenomenal in all respects. The Aviation Industry in India is the most rapidly growing aviation sector of the world. With the rise in the economy of the country and followed by the liberalization in the aviation sector, the Aviation Industry in India went through a complete transformation in the recent period.

Role of Aviation Industry in India GDP-Facts

  • With the entry of the private operators in this sector and the huge cut in air prices, air travel in India were popularized
  • On February 18, 1911, the first commercial flight was made from Allahabad to Naini by a French pilot named Monseigneur Piguet

Role of Aviation Industry in India GDP-Growth Factors

  • The growth in the Indian economy has increased the Gross Domestic Product above 8% and this high growth rate will be sustained for a good number of years
  • Air traffic has grown enormously and expected to have a growth which would be above 25% in the travel segment
  • In the present scenario around 12 domestic airlines and above 60 international airlines are operating in India
  • With the growth in the economy and stability of the country India has become one of the preferred locations for the trade and commerce activities
  • The growth of airlines traffic in Aviation Industry in India is almost four times above international average
  • Aviation Industry in India have placed the biggest order for aircrafts globally
  • Aviation Industry in India holds around 69% of the total share of the airlines traffic in the region of South Asia

Role of Aviation Industry in India GDP-Future Challenges

  • Initializing privatization in the airport activities
  • Modernization of the airlines fleet to handle the pressure of competition in the aviation industry
  • Rapid expansion plans for the major airports for the increased flow of air traffic
  • Immense development for the growing Regional Airports

Role of Aviation Industry in India GDP-FDI Policy

The Reserve Bank of India (RBI) announced that foreign institutional investors might have shareholdings more than the limited 49% in the domestic sector.

Airports

  • Foreign equity up to 100% is allowed by the means of automatic approvals pertaining to establishment of Greenfield airports
  • Foreign equity up to 74% is allowed by the means of automatic approvals pertaining to the existing airports
  • Foreign equity up to 100% is allowed by the means of special permission from Foreign Investment Promotion Board, Ministry of Finance, pertaining to the existing airports


Air Transport Services

  • Up to 49% of foreign equity is allowed by the means of automatic approvals pertaining to the domestic air transport services
  • Up to 100% of NRI investment is allowed by the means of automatic approvals pertaining to the domestic air transport services