India to boost aviation infrastructure as demand booms

India outlined plans on Monday to invest billions of dollars in airports, aircraft and recruitment as the world's fastest-growing economy seeks to meet booming air travel demand.

Growth will include new airports, more regulators and air traffic controllers, and new flying schools, Civil Aviation Minister Jyotiraditya Scindia told an industry audience.

"We need to put in place the civil aviation infrastructure and capabilities that by 2047 would be able to support a $20 trillion economy within India," Scindia told the CAPA India Aviation Summit in New Delhi.

Prime Minister Narendra Modi's government said this year that the South Asian nation would spend 980 billion rupees ($11.88 billion) by 2025 to boost regional connectivity by constructing airports and modernizing existing ones.

Weak infrastructure is seen as hindering India's aviation growth, especially as it looks to connect the country's hinterlands to bigger cities in a bid to get more people to fly.

Scindia said passenger capacity at the country’s six major airports is expected to grow to 420 million in four years from 192 million today, and Indian carriers’ fleet will grow to 2,000 aircraft in five years from 700.

Airline traffic is recovering quickly from coronavirus restrictions that led to jets being grounded worldwide in 2020, with manufacturers now struggling to keep pace with aircraft demand and engine shortages grounding some planes.

"Surprisingly and shockingly, the situation has turned the other way. Where at one point we did not have passengers to fill our airplanes … now we do not have enough airplanes to fly our passengers," Scindia said.

To help fill the gap, India has tweaked its airplane leasing program, including more "wet leasing" or renting of planes with crew, for domestic and international routes, he added.

Consultancy CAPA India expects at least 1,300 more orders from Indian airlines in the next 1-2 years, weeks after Air India announced a record order for 470 jets.

But it warned that the notoriously cyclical industry could tip back towards surplus.

Kapil Kaul, the consultancy's chief executive, said Indian airlines were flying over 90% full even during the normally quieter weekdays - "a sign of shortages".

There is also a "serious shortage of experienced pilots, particularly for wide-bodies," he added.

($1 = 82.4980 Indian rupees)