India, Germany enter deal on civil aviation

India’s Union Cabinet, chaired by Prime Minister Narendra Modi, has approved the signing of a preliminary agreement titled Joint Declaration of Intent between India and Germany on Cooperation in the field of Civil Aviation

June 27, 2018

The deal will lead to promotion of effective and efficient air transport between India and Germany, besides promoting and facilitating exchange of knowledge and experience in civil aviation

Trade between the countries reported a 17 per cent rise to US$22 billion during financial year 2017-18. On the back of rising partnership in infrastructure and engineering, trade will receive fresh boost

Deal includes continued collaboration at the International Civil Aviation Organization (ICAO) on key global issues as well as sharing of information on facilities for business and non-commercial aviation

The deal with Germany is critical as it comes amid a steady expansion in India's civil aviation market, covering both domestic and international routes; India allows FDI of 49-100 per cent for in the sector

India’s Union Cabinet, chaired by Prime Minister Narendra Modi, has approved a preliminary agreement titled Joint Declaration of Intent between India and Germany on Cooperation in the field of Civil Aviation. The deal will lead to promotion of effective and efficient air transport between India and Germany, besides promoting and facilitating exchange of knowledge and experience in civil aviation. It also signifies a landmark in civil aviation ties between India and Germany, and has the potential to spur greater trade, investment, tourism, and cultural exchanges between the two countries. Bilateral trade between the countries reported a 17 per cent rise to US$22 billion during financial year 2017-18. On the back of rising partnership between the nations in infrastructure and engineering, bilateral trade will receive a boost.

The agreement involves mutual cooperation in the following areas:

  1. Aviation Safety and Air Traffic Management: Sharing of information and best practices related to aviation safely activities and safety oversight including Air Traffic Management.
  2. Heliports and Helicopter Emergency Medical Services (HEMS): Sharing of information and best practices related to heliports and Helicopter Emergency Medical Services.
  3. Regulations and Policy: Continued collaboration at the International Civil Aviation Organization (ICAO) on key international issues.
  4. Corporate and Business Aviation Development: Sharing of information on facilities for business and non-commercial aviation.
  5. Environment:
    (i) Sharing of experience regarding governmental oversight of aerodromes with special focus on sustainable and environment-friendly aerodrome development and planning.
    (ii) Collaboration at international level to tackle climate change by addressing Greenhouse Gas (GHG) emissions associated with aviation, both at domestic and international levels.
  6. Training and Skills Development: Explore partnerships in technical and non-technical cooperation and training, in particular, in aviation safety oversight.

The deal with Germany is critical as it comes amid a steady expansion in India’s civil aviation market, covering both domestic and international routes. Players in the space such as Indigo, SpiceJet, Vistara, backed by their growing fleet of aircrafts, are adding new domestic and international destinations. While improving economics and infrastructure have increased the scope of air travel to tier-2 and tier-3 Indian cities, a steady rise in international traffic has encouraged stiffer competition from new entrants. India allows FDI of 49-100 per cent for different services in the sector, which has attracted foreign entities in different aspects of the sector. Following Malaysia-based Air Asia, Qatar Airways is looking to launch a domestic airline in India. Meanwhile, Vistara is looking to start its international service later this year.