MBA Aspirants are expected to know markets beyond established Brands. This helps them to understand industry for which they are dreaming to join in future. Today, you will read on Indian Aeronautical industry
The Indian aeronautical industry can be divided into two segments – the defense aviation sector and the civil aviation sector. India’s aeronautical industry is the ninth largest in the world and experts predict that in the next five years, the industry will be the fifth largest in the world.
At present, India’s defense industry is the largest importer, and the value of imports stands at Rs 6,229 billion. It is said that the Indian aeronautical industry is set to expand its fleet of aircrafts by 1,400 in the next few years to meet the growing demand in the defense and civil aviation sectors. In the last two years, the civil aviation sector had recorded an annual growth of 41% in passenger traffic.
And this figure is expected to grow in the years to come, putting extreme pressure on the existing civil aviation infrastructure. As a result, the Indian government is setting aside funds to modernize airports, and enhance communications, surveillance and navigation systems.
In the Indian military aviation market, the major player is Hindustan Aeronautics Limited, which is owned by the government of India. Hindustan Aeronautics Limited plays a major role in India’s defense aviation and is responsible for the design and production of fighters, helicopters, trainers, engines, avionics and system equipment.
Hindustan Aeronautics Limited is a major partner for space programs conducted by the Indian Space Research Organization and is involved in the production of satellites and launch vehicles too.
Hindustan Aeronautics Limited has produced over 3550 aircrafts and 3650 aero-engines, and it is ranked 34th in the list of top 100 defense companies in the world. Other well-known players in the Indian military aviation market are Bharat Electronics Limited, Dynamatic Technologies, Samtel Avionics and Defense Systems, and Tata Advance Systems Limited.
India ranks among the top 10 countries in the world with regard to military expenditure, and it is expected to increase its investments in this sector to further strengthen its defense capabilities.
In the Indian commercial aviation sector for domestic travel, the major player is Indigo, with a market share of 27.3%. Other players in the commercial aviation sector are Jet Airways (with 25.2% market share), Air India (with 20.7% market share), Spice Jet (with 19.5% market share), and Go Air (with 7.4% market share).
These domestic carriers operate a total of 369 aircrafts. And this figure is expected to grow in the next few years - Indian carriers have placed orders for 436 new aircrafts to cater to the growing domestic and international travel demand.
According to industry experts, there is a strong correlation between gross domestic product (GDP) and the aeronautical industry. As a nation’s per capita GDP grows, so does the desire and ability of its citizens to afford travel.
And this in turn fuels the demand for aircrafts and more investments in the aeronautical sector. When there is significant economic growth in a country, the government will be able to spend more on the defense industry, and this will once again drive the growth of the military aviation market.
Experts predict that India’s economic growth in the coming years will enhance the position of the Indian military aviation sector and the commercial aviation sector, and by 2020, the Indian aviation market is expected to make its way to the top three in the world.