An Assessment of the Role of Indian Aviation in Facilitating Travel and Tourism Market

Abstract

Tourism has grown virtually uninterrupted over the past six decades. In 2014, slightly over half (54%) of all overnight visitors travelled to their destination by air. The trend over time has been for air transport to grow at a somewhat faster pace than surface transport. Accesses to technology, low airfares have given a fillip to online tourism in India. India's demographic dividend of a younger population, rising income levels and changing lifestyles is leading to a greater expenditure on leisure services. Reports on travel patterns of Indians say that approximately 41% of gross travel bookings in India are taking place online. About 90% of over 6.5 million tourists arriving in India do so via air travel. The aviation sector created 1.7 million jobs, direct and indirect, while contributing nearly 1.5% to India's Gross Domestic Product. India is the ninth largest civil aviation market in the world and has the potential to become the third largest aviation market by 2020 and the largest by 2030 says the FICCI-KPMG report. In September 2012, Government of India had liberalised foreign direct investment regulations in Indian Aviation Sector; its impact is probed in the present work. The paper with broader reference to the tourism potential of India assesses Indian aviation sector and the new civil aviation policy 2016. It also identifies areas due to which aviation sector is unable to harness its full potential and also suggests solutions.