MUMBAI – Plane makers Airbus and Boeing remain bullish on the demand for civilian aircraft from India despite a much slower GDP growth in the last two years. Analysts and industry experts, however, warn of a lower than anticipated passenger growth unless urgent measures are taken to revive the sector In the market forecast last year Airbus and Boeing estimated a demand for 1232 and 1450 planes respectively over the next two decades. These estimates were drawn up when Kingfisher Airlines was still in service and have estimated India's GDP growth at over 8 percent. Similarly a civil aviation ministry report for the formulation of the 12th five year plan (2012-17) factored 12 percent average annual growth in domestic air traffic between 2012-2017. In reality the GDP growth has slowed down to 5 percent in last fiscal and is estimated to grow around 6 percent this year. The domestic air traffic growth too is subdued and analysts and airlines are expecting around 6 percent growth this year. Despite the obvious slowdown the plane makers remain optimistic about their India forecast. "Our forecasts, look at passenger traffic growth over a 20 year period which takes peaks and troughs into account. This growth is translated into demand for aircraft. India continues to be one of the fastest growing regions for aviation traffic growth in the world over the next 20 years, so our forecast for new aircraft in India will not dramatically be adjusted,' Airbus said in an email response. Similarly, a Boeing spokesperson said "our airline customers have indicated that they will continue with their fleet plans. India is projected to have the highest passenger traffic growth in the world. Over the next twenty years, the forecast passenger growth is expected to be driven by an underlying economy with long-term growth projections of twice the world average and supported by the continued economic prosperity amongst a growing segment of the large Indian population, higher discretionary incomes, business progress and easier access to airports. Domestic airlines did not respond to email on the subject but are unlikely to cut back their existing orders. A Jet Airways source said although domestic market is slow it can cross utilize the Boeing 737s for its international operations. Jet Airways has pending deliveries of 46 Boeing 737s expects to induct a plane each month over the next 3-4 years. Similarly rival IndiGo is expected to add another 50 planes to its existing 70 Airbus A320s till 2017. SpiceJet plans to add eleven Boeing 737s to its existing 55 plane fleet till end of FY 2015 and is seeking early deliveries, a source said. SpiceJet has an option to take additional 15 Bombardier Q400 turbo props but has held back the decision due to subdued passenger demand. — Agencies
