Development News Edition
Give Feedback

Indian carriers require USD 50 billion for delivery of aircraft orders

Indian carriers, which have placed large aircraft purchase orders, will require a whopping USD 50 billion of financing to take the expected scheduled delivery of these planes over the next nearly 10 years, a report said.


PTI Last Updated at 05-08-2018 18:15:34 IST India
Indian carriers require USD 50 billion for delivery of aircraft orders

Indian carriers, which have placed large aircraft purchase orders, will require a whopping USD 50 billion of financing to take the expected scheduled delivery of these planes over the next nearly 10 years, a report said.

With a total of 1,055 aircraft on order, as many as 100 planes consisting of wide-body, narrow-body and regional ones are to be delivered to Indian carriers each year for the next five years, said the report by Sydney-based aviation think-tank Centre for Asia Pacific Aviation (CAPA).

Against this background, Indian carriers will require an estimated USD 50 billion of financing to support projected deliveries until 2027, it said.

Stating that the unexpected recovery in Indian aviation since 2014 has changed the dynamics of the market and the demand for aircraft, the CAPA said, "Positive market conditions have led Indian carriers to place bets on expansion on an unprecedented scale, with as many as 723 aircraft ordered since 2014 and more orders expected."

India's domestic market has grown at around 20 percent year over the last three years and a similar expansion is expected in the current financial year, it said.

Meanwhile, international traffic has also grown steadily at 8-10 percent per annum in recent years, it added.

The projected fleet expansion represents a major opportunity for aircraft investors looking to deploy capital in new generation assets, the report said, adding, "However, despite the strength of underlying demand, operators in the Indian market face a number of challenges."

"On the cost front, Indian carriers pay some of the highest fuel taxations in the world and also incur taxes on aircraft leases. While on the supply side, infrastructure and skills shortages (particularly commanders) are potential constraints on growth," said the CAPA report.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)


add banner

LEAVE COMMENT