The year 2020, with the onset of the coronavirus pandemic, was possibly the aviation sector’s most turbulent year till date. While no flights took off during the lockdown to prevent the transmission and spread of this deadly virus, airlines resumed services by May following a hefty list of protocols and precautions and slowly began reviving the sector. Since then, the daily passenger number has increased tenfold, but with fewer people flying, complete recovery is still a long way to go.
To discuss the resilience and future of the aviation sector, CNBC-TV18 launched a special series titled Powering Aviation, in association with GE.
The runway to the new normal
In the inaugural episode CNBC-TV18’s Rituparna Bhuyan spoke to an esteemed panel that included Vandana Aggarwal, Senior Economic Advisor, Ministry of Civil Aviation, GOI; Vikram Rai, Country Head – South Asia and Indonesia, GE Aviation; Hari K Marar, MD and CEO, BIAL; and Amitabh Khosla, Country Director - India, IATA. They delved into the numerous trends shaping the civil aviation sector with domain experts sharing their views on the impact of COVID-19 and its many implications on the civil aviation industry, how it can stay resilient and what is needed to create a roadmap for the aviation industry in the new normal.
Vandana Aggarwal, Senior Economic Advisor, Ministry of Civil Aviation, GOI, estimates that the aviation sector will reach the new normal by next year “With many airports showing a higher growth than the previous year, which is driven by the Krishi cargo, pharmaceuticals and essentials. Manufacturing has also picked up in the last few months.”
During this time, safety became a key concern for passengers considering air travel. “The aircraft is an extremely safe environment. The only loophole that perhaps still exists is when meals are served, as customers need to remove masks to eat, which is further exasperated by the proximity of seating increasing the chance of transmission. If we can counter that, we could possibly return to full capacity,” said Sanjiv Kapoor, Senior Advisor, Alton Aviation.
Vikram Rai, Country Head – South Asia and Indonesia, GE Aviation, spoke about how GE can help the sector rebuild and recover, “We are working with airlines as a partner to help mitigate the turbulence, reducing costs and provide safe, reliable operations. Given how the sector has bounced back and the growth trajectory moving forward, we are seeing a rise in enquiries from entrepreneurs wanting to launch new airlines.”
Speaking about opportunities to recover from the ongoing difficult times, Hari K Marar, MD and CEO, BIAL, said, "One of the regulatory changes that will have an immediate impact on aviation, and will support the growth and development, is bringing the ATF under the GST ambit."
When asked about a key recommendation that should be made to the government,
Amitabh Khosla, Country Director - India, IATA, said, “The recovery in domestic travel has been successful, with almost 80 percent capacity being deployed. What would really help is anything that can facilitate a normalisation or a restart for international travel.”
Watch the complete episode here: https://www.youtube.com/watch?v=4eqGaTAk0zg
Defence and aerospace
The second episode focused on the impact of the government’s Atmanirbhar Bharat campaign on the defence and aerospace segments. As India waged its battle to contain COVID-19, it brought about a renewed focus on self-reliance and Make in India by launching the Atmanirbhar Bharat campaign.
With an imminent panel that included JD Patil, Whole-Time Director and Member of the Board at L&T; Christopher Cyr - Vice President, Military Sales and Business Development at GE Aviation; and William Blair - VP & Chief Executive at Lockheed Martin India, CNBC-TV18’s Rituparna Bhuyan queried them on strides India has made towards self-reliance, and what steps can be taken to further development.
Having been part of the Make in India ecosystem, William Blair - VP & Chief Executive at Lockheed Martin India, talked about positive changes it brings, "With the C130J program, even before the Indian air force acquires 130Js, we set up operations in Hyderabad to produce empennages of the aircraft for Indian and global requirements. We have been part of self-reliant India for a decade, which flows down to over 240 suppliers.”
Christopher Cyr - Vice President, Military Sales and Business Development at GE Aviation also spoke about GE’s involvement in boosting the Make in India initiative, “It's a great time for a lot of companies and we look forward to supporting conversations between the Indian and US governments. When it comes to Make in India, we look at developing an aviation infrastructure, where it's not just Indian companies making parts for us but we can support in building the entire ecosystem and supporting it to become self-reliant. Our approach includes the design which we get from the GE’s India Technology Centre in Bengaluru, thereafter translating it into the military space, making parts and supporting them, and building the right capabilities, in terms of people.”
With the many changes that took place in 2020, COVID-19 and China reigned supreme. To understand how they influence India's defence budgets, and the challenges defence companies in India will have to navigate through, JD Patil, Whole-Time Director and Member of the Board at L&T, shared his views, “While the defence budget was reduced in the first quarter, quarter two will be better since the restrictions from quarter one have been removed. However, there won’t be a significant difference due to the pandemic. While we have sizeable amount of equipment purchases in the pipeline, we anticipate that we’ll have a much better defence allocation in the next financial year as the economy bounces back.”
Watch the complete episode here: https://www.youtube.com/watch?v=TFy7-CSV178This is a partnered post.