POLITIC

AL

ECONOMICAL

National Civil Aviation Policy

Foreign Direct Investment

Other Factors

SOCIAL

TECHNOLOGY

ENVIRONMENT

LEGAL

Replaces "5/20 rule with "0/20 rule

Benefit: Air Asia India & Vistara
Setting up no-frills airports
Regularization of Domestic fares

100% Foreign Direct Investment (FDI) is permitted for Greenfield airport projects
Up to 74% FDI is permitted for existing airport projects under the automatic route,
above 74% and up to 100% permitted.
Up to 100% FDI is permitted in helicopter services and seaplanes
Up to 100% FDI is permitted in maintenance and repair organizations; flying
training institutes; and technical training institutes

Deregulation and allowance to private players in Civil Aviation

Foreign Relations and Tie Ups
Terrorism Threat

Gov. Proactive
Policies being made in favor of Aviation Sector

POLITICAL

ECONOMIC
AL

SOCIAL

TECHNOLOGY

ENVIRONMENT

Oil Price
15% ticket price dip in 2015-16 owing to oil price drop
Oil price fell drastically
Helped turn fortunes for Jet Airways
Prices of aviation turbine fuel (ATF) fell 22% in the twelve months till the end of FY16
Fastest growing economy
Good Gov. Initiatives like Make in India would promote the Indian Economy.
Good work done by Raghu Ram Rajan in keeping the macro elements in check in times of Global
turmoil
Banks not doing good :NPA problem
Financially
Air India: In a lot of debt: Gov. exempted, merger with Indian Airline Limited
Indigo: Built on the lines of South West Airlines. Most consistent profit making Indian airline
Jet Airways: Posted profit after 8 years owing to cheaper fuel

Economic Conditions in India look good

Oil price was a boon

LEGAL

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ECONOMICAL

SOCIAL

TECHNOLOGY

ENVIRONMENT

LEGAL

Target Customer
Indias middle-income population is expected to increase from 160 Million in 2011 to 267 Million by
2016.
Indian aviation is experiencing dramatic growth across the board, from the emergence of LCC/new
carriers to a growing middle-class ready to travel by air as well as growth in business and leisure
travel.
New Policy aimed at increasing customer base
Airline ticket prices are constantly going down for the past 10 years.
Average annual growth rate of passenger-traffic
More than 18-20 per cent since 2000
Barring Three events:
2001-02 in the wake of terrorist attacks in the US (9/11) and the subsequent global crisis
the great 2009 financial recession
and in 2012 when Kingfisher Airlines went bankrupt.

Better Economic Conditions : Inc. per capita

Income

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ECONOMICAL

TECHNIC
AL

SOCIAL

ENVIRONMENT

LEGAL

Foreign Aviation companies involved in India

either directly/indirectly

Eco Climb

Express
Skyways

Airbus 2050
vision
Smarter
Skies
Free Gliding
Approaches and
Power
landings

Airbus (France)
Boeing International Corporation (USA)
AirAsia (Malaysia)
Frankfurt Airport Services Worldwide (Germany)
Honeywell Aerospace (USA)
GE Aviation (USA)
Alcoa Fastening Systems Aerospace (USA)
Airports Company South Africa Global (South Africa)
Other
The AAI plans to spend USD 1.3 Billion on non-metro projects
between 2013 and 2017, focusing on the modernisation and
up-gradation of airports.
Indian airports are emulating the SEZ Aerotropolis model to
enhance revenues, focus on revenues from retail,
advertising and vehicle parking, security equipment and
services.

Foreign Players will bring the latest

technology

POLITICAL

ECONOMICAL

SOCIAL

TECHNOLOGY

ENVIRONM
ENT

LEGAL

In the European Union, greenhouse gas emissions from aviation increased by 87%
between 1990 and 2006
aviation emissions have escaped international regulation thus far
Ongoing debate about possible taxation of air travel to reduce air travel
U.S. airlines alone burned about 16.2 billion gallons of fuel b/w Oct 2013 Sep 2014
are excluded from the scope of the first period (2008-2012) of the Kyoto Protocol

Current scenario: Reducing air travel seems

the best option

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ECONOMICAL

SOCIAL

TECHNOLOGY

ENVIRONMENT

LEGAL

Ministry of Civil Aviation

DGCA ( Directorate General of Civil Aviation)
BCAS (Bureau of Civil Aviation Security)
AAI (Airports Authority of India)
New airports are permitted under the Greenfield Airport Policy 2008. Investment in airports is
encouraged under the PPP Policy of the Government of India.
Regional Air Connectivity Policy offers attractive incentives in the form of exemption of
landing, parking and navigation fees to airlines operating at designated airports in non-metro
areas.
Greater focus on infrastructure development; increasing liberalization Open Sky Policy; AAI
driving modernization of airports, Air and Navigation Systems.
MoCA will persuade State Governments to make VAT zero-rated on MRO activities

Ease of doing business: India is moving up