Neelam Mathews

Boeing’s 20-year market outlook for India, released on July 31, reflects the manufacturer’s optimism that the Indian economy will remain strong and grow from the world’s seventh to third largest by 2037. But that outlook may underestimate the need for smaller regional jets identified during a conference the following day in India’s northeast region.

 


Based on the expected economic underpinning, Boeing forecast a demand for 2,100 new airplanes valued at $290 billion over the next two decades, increasing from the 1,850 new airplanes it predicted last year. “This is the highest-ever forecast we have presented for India,” Dinesh Keskar, Boeing senior vice president of sales for Asia-Pacific and India, said during a briefing in Delhi.

 


The bullish Boeing forecast, however, calls for only 10 new deliveries of regional jets of 90 seats and below from 2017 to 2036—the same number as estimated last year.

 


Boeing is “still gaging how regionals will pan out” and may increase its forecast for smaller jets next year, Keskar said. He agreed that India’s Regional Connectivity Scheme (RCS) called Udan (“Let every person fly”) will open new regional routes for aircraft including Boeing’s 737 narrowbody airliner. “Over the next four-to-five years, the growth on those (regional) routes will make a Boeing 737 viable. We are very bullish that if it (RCS) works out, we will be one of the beneficiaries,” he told AIN.

 


India recently launched the first phase of the RCS, offering subsidies to operators flying to remote, new and underserved destinations. The second phase of bidding for routes is expected in the next two months.

 


The RCS has brought a fresh focus on connectivity to the neglected eight states of India’s North East Region (NER), an area that shares disputed borderland with China. The geographically isolated region suffers from a lack of transportation infrastructure and is considered a priority for development, with numerous airstrips and airports being upgraded.

 


At the “Strengthening Aviation Network” conference held on August 1, a proposal was advanced to designate the host city of Guwahati in the Indian state of Assam as the region’s hub. There is currently an international airport under construction in Guwahati.

 


“It is time India starts leveraging the NER as entry into Southeast Asia,” declared Ravi Capoor, chief secretary for industries and commerce with the government of Assam. Capoor proposed basing the NER on the model of Yunnan province in China, which has become an air portal into Southeast Asia.

 


While markets take time to develop, India Ministry of Civil Aviation director Shefali Juneja described the greater region encompassing the so-called BCLMV countries of Bangladesh, Cambodia, Laos, Mynamar and Vietnam as a dynamic, fast-growing area with close ethnic and cultural ties to India. Those factors point to high traffic potential, she said.

 


But realizing the region’s vision of improved connectivity will require smaller regional aircraft including turboprops, suggested Vinod Kayle, secretary of civil aviation with the government of Arunachal Pradesh, the smallest of the NER states. “If you want to connect the NER, focus on ATR-42-size (aircraft), as in this terrain, land is vital,” he said.

 


Conference chairman Pran Sathiadasan said India will need to rethink its NER aviation policy to waive the 20-aircraft minimum clause for operators flying abroad. Depending on passenger numbers, BCLMV countries will also need regional aircraft, he added.

 


The Ministry of Civil Aviation is expected to meet August 14 to discuss regulatory changes and the need to declare Guwahati as a hub between the NER and neighboring Southeast Asian countries that have short flying distances of around 45 minutes.

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