January 28, 2019
Currently, India outnumbers both China and Japan when it comes to the ownership of private jets
New private aircrafts have entered India over the past 10 years, making it the ninth largest market
Apart from ownership, rental companies such as BookMyCharters, JetSetGo, Taj Air offer private jets
Corporate groups such as GMR, Punj Lloyd, Jaypee and DLF have leased their aircrafts to aggregators
As India gears up for general elections in the coming few months, as per the norm of election season, the nation will witness large number of personally-owned aircrafts land in smaller towns and villages which are not part of regular air traffic route as yet. Politicians are just one part of a vast clientele of private civilian aviation that has emerged across modern India. The growing trend holds true also for high-net individuals such as industrialists, celebrities and VVIPs as well as for critical corporate and private events, emergencies and tourism. Besides renting, private ownership of private aircrafts has also seen a steady rise in India. This has opened up opportunities of high-margin investment in a sector that is ceasing to remain niche.
On December 12, 2018, an estimated 200 private jets ferried guests from different parts of India to Udaipur to attend the wedding of Asia’s richest businessman Mukesh Ambani’s daughter’s wedding. Ownership of business jets among Indian business heads has come up as a necessity, much in line with the rest of the world. Some like former Tata Sons chairman Ratan Tata even fly their own jets. Indians who own private aircrafts include businessmen such as Lakshmi Mittal, KP Singh, Atul Punj, Gautam Singhania, among others. There has also been a growing number of celebrities from media and entertainment who have been picking up private planes such as Shah Rukh Khan, Amitabh Bachchan and Priyanka Chopra to name a few.
Currently, India outnumbers both China and Japan when it comes to the ownership of private jets. According to data shared by International Air Transport Association (IATA), billions of dollars worth of new private aircraft have entered India over the past 10 years, making it the ninth largest market in the world. By 2026, this sector is expected to overtake the UK to become the third largest in the world. Apart from private ownership, jet rental companies such as BookMyCharters, JetSetGo, Taj Air, PrivateFly, among others, have come up across India that have steadily added to their fleets to cater to the rising demand of private air travel. Rising investment and resultant competition in the space has expanded the market for private aviation.
Owning a private jet comes with its share of challenges, primarily in terms of infrastructure amid rising traffic at Indian airports. However, heavy investments in the space from the government to expand capacity to support future demand has sought to ease those concerns. Government of India proposes to develop 200 low-cost airports by 2035 involving an investment exceeding US$2 billion. The nation is expected to see an investment of over US$25 billion in the next 20 years in the aviation industry. Additionally, India’s strong base of human capital, from pilots to maintenance experts to cabin crews have further boosted the growth of the industry. Activity in the space will get stimulus as the Airport Authority of India revives 50 domestic airports.
As of now, India has an estimated 515 private aircrafts, including 257 fixed wing planes as well as 258 helicopters. With an uptake in foreign tourist arrivals as well as travel around India owing to India’s steady and fast-paced economic growth, the country’s private aviation market will only surge. In India, one can also avail aircrafts under the Non-Scheduled Operator’s Permit (NSOP). Where private ownership is not feasible, companies may buy a minimum required number of planes, including helicopters for their on-land and offshore business activities. This permit is issued by the Directorate General of Civil Aviation (DGCA). Such corporate ownership of private jets has further expanded the market and opened new investment avenues.
The privately-owned aircraft industry is exploring a new revenue model. Companies such as JetSetGo that are said to have the largest fleet of private aircrafts, including helicopters, along with Air Charter India, Span Air, Titan Aviation, Empire Aviation, Raymond Ltd, Air Limousines, Paramount Business Jets are offering privately owned, chartered air travel services. Infrastructure, real estate, hospitality and media companies that own private aircrafts have also been leasing out aircrafts to aggregators that operate, maintain and rent out the aircrafts to meet the growing demand. Hence, corporate entities such as GMR Group, Punj Lloyd, Jaypee Group, DLF, Supertech and Bhaskar group are a few of the corporates that have leased their aircrafts to aggregators.
In addition to business aviation, the industry is extending its services to the healthcare sector by shifting patient from one part of a city or country to another, where they can receive immediate medical attention. This is especially useful in the case of organ donation where time is critical . Air ambulances are fitted with complete ICU, CCU, PICU, NICU and emergency medical care facilities. Medivic Aviation is a provider of this service at present.
Helicopter tourism is another non-traditional offshoot of the civil aviation industry. Mid-air birthday parties and marriage proposals, aerial views of heritage sites, mountain peaks and water bodies are an adrenalin high that India’s high-networth individuals ( HNIs) can now afford. Travel to pilgrimage sites in helicopters or small aircrafts have also picked up in the last few years. Additionally, growth in e-commerce has led to multifold growth in freighter fleet.
A 20 year road map by India’s Ministry of Civil Aviation forecasts that the total number of airports in India will increase from 99 in March 2018 to around 190-200. The plan is to ensure that India’s top 31 cities by population have at least two airports each, with Delhi and Mumbai having three each. With all the initiatives rolled out, India’s aviation industry is gearing up to soar to greater heights in coming years with a critical role to be played by private aviation.