MIAMI — Outgoing IATA Director General Tony Tyler summed up the potential of India’s aviation market perhaps as simply and elegantly as anyone, “The Indian aviation industry surely could be one of the great success stories of the world.” Qatar Airways CEO Akbar al Baker similarly noted the significant “opportunities and capabilities that very few countries have.” when speaking at the recent IATA Annual General Meeting. Both were speaking about what they’d like to see from the new government with respect to the way airlines are treated in the market. And, not surprisingly, al Baker expressed a number of thoughts about what Qatar Airways would like to see made available.
The Indian market is most definitely growing, though in fits and starts. New airlines have launched in the domestic market and some have even expanded internationally, though lasting success has been rare. Even the domestic carriers have not been guaranteed success, despite the rapidly growing upper and middle classes in the 1.2 billion person population. There have been bankruptcies, fare wars and outside investments. The latter only with government approval. And it seems that Qatar Airways wants in on that game.
We are very keen in investing in IndiGo if it is available. It is the most successful Indian carrier, the most efficiently run Indian carrier and the most progressive Indian carrier. We always like to associate ourselves with success.
It is not clear the Indian government is interested in offering up foreign investment opportunities to the airlines which are currently successful so this may be an uphill battle for al Baker.
There is also the long-standing challenge of limited operational frequencies and capacity in and out of the country for foreign carriers. Only recently did the Indian government agree to allow A380s into the country, for example. To al Baker, however, such limits are unreasonable and stifling. He suggested that “[T]he potential is so huge that even if you allotted capacity to every airline that is applying to fly to India you would still have load factors in excess of 80%.” Maybe so, but it is not clear that the yields on those operations would be sufficient to keep the airlines – especially the Indian-owned ones – in the black with the additional capacity. That is of less concern to al Baker, as he broke out the rhetoric of economic growth and prosperity for the everyman as part of his campaign to gain more access to the Indian markets.
Aviation is a very important tool of generating economic growth in India. It is only aviation that will bring you trade, that will bring you tourism, that will in return bring more employment and and will bring prosperity to a lot of deserving Indian people that up to now are being deprived of so much opportunity. I hope this is a very strong message to whoever is listening.
It is unlikely that there will be too much changing in the immediate future. But it is quite clear what Qatar Airways wants in the Indian market: More of everything.