“The Indian Aviation has a huge potential,” Subhas Menon, DG, AAPA
At the Singapore Airshow, in a candid interview with Vishal Kashyap, Managing Editor, Aviation World, Director General of Association of Asia Pacific Airlines(AAPA), Mr. Subhas Menon shares insight on various key aspects of the growing Aviation sector in Southeast Asian region with special views on India. Excerpts… Q: How you see the evolving Indian Aviation ecosystem? A: The situation of India and the Indian authorities is huge. India wants to build an aviation ecosystem that meets the ambitions of Indians. They should be able to go to anywhere in the world and for their families who are overseas to come to India from anywhere in the world seamlessly and comfortably. At the moment, anywhere the Indians want to go to, they have to go through other hubs. The ambition of the Indian authorities is to have all the hubs in India itself. The domestic Indian traffic has been building up over the years and growing naturally. The international Indian traffic is still very low as it’s the third largest aviation market in the world after the US and China. The Indian carriers have made huge aircraft orders and when these orders were placed, the supply chain crisis has already happened because it occurred during the pandemic. They may not be able to get all the aircraft that they have ordered in time as there will be disruptions. On safety side, it’s not only specific to India as we have seen aircraft incidents becoming very common. The regulators need to make the system more stringent so that such incidents should be discouraged or minimised. Still, air transport continues to be the safest mode of transport. Q: What’s your opinion on the future airspace movements in India? A: Airspace will be packed but India is starting from a low base. I think, there is still a lot of room to grow in terms of airspace as it will take 5 to 10 years to get all the aircrafts that both IndiGo and Air India have ordered which is slightly over 1000 aircrafts. If the manufacturers are business savvy, they will try to supply the aircraft as quickly as possible to the Indian operators. It needs to be speed up as nobody else is really ordering that many aircrafts. India is really growing very fast and has the potential to grow further by leaps and bounds. Q: Could you specify on the countries which have significant growth in this region? A: If you look at the potential, it is basically India and Southeast Asia. They all have young population and a growing middle class. In the Asia-Pacific region, we are not contiguous or compact as people need to travel by air and it share some of same demographies. China now is actually going into an ageing population. Though their middle class can still grow, but they are facing some economic constraints at the moment. So, they might not be a growth market and we are trying to get to see whether it will go back to the levels of travel generation that they had before the pandemic. Outbound travel in China was driving growth for many years but post pandemic they have certain level of economic problems. Q: How you see Vietnam and Indonesia growing an aviation hub in the region? A: The Vietnamese government managed to get one of the lowest tariffs in the US. There was a parallel economy to China developing in Vietnam for manufacturing goods in the last five years and its continuing. Vietnam also has a very young population, so workforce-wise, a lot of centralisation is taking place within the country. The potential for Vietnam is huge, both inbound and outbound as it’s a very beautiful country. They have a tourism plan which encourages and attracts people to visit Vietnam from a historical, cultural, as well as leisure perspective. Vietnam Airlines is going as an international hub carrier and they also have a low-cost carrier there. For Indonesia, it’s always been huge and they have a strong national carrier. They also have budget carriers, both who are members of AAPA (Association of Asia Pacific Airlines). There is inbound as well as outbound potential but at the moment, Indonesia is struggling a little bit because they had a change of government further adding to change of policies and regulations. It’s a matter of time before they stabilise and go back to growth as the Indonesian government is very keen to bring a lot of tourists to Indonesia. Q: The Indian Govt. had recently issued NOC to three new airlines to break the existing duopoly. But in ground they are facing challenges to procure an aircraft. How you see such situations? A: Generally, we support competition as its good to have the same. But it is not good if airlines start and then they don’t fulfil their mission and they go bust and not able to survive. The best advice to the potential startups’ airlines would be to ensure enough funds to last long. It should be minimum for five years before one can really stabilise their operations. If they don’t have that, it’s a big risk to start an airline. In the last few years, there have been a few startups in the region and most of them didn’t make it. Q: What are the key factors that OEMs basically see before giving an aircraft to a startup airline? A: It’s the financial capability to sustain for a long term is one thing that OEMs look at. If they once survive the startup stage, then at least you have a future. Number two, they are in the process of trying to fulfil outstanding orders, so, why would they give new aircraft to new startups when they haven’t fulfilled their outstanding orders. That doesn’t make any sense as they have a relationship with existing operators who are still waiting for their orders to be fulfilled.I think it’s a reasonable thing to do to make sure that existing clients get









