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An investigation into the core underlying problems of India's airlines

Author

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  • O′Connell, John F.
  • Krishnamurthy, Pukezhenthi
  • Warnock-Smith, David
  • Lei, Zheng
  • Miyoshi, Chika

Abstract

India’s aviation industry promises huge growth potential due to a large and growing middle class population, favourable demographics, rapid economic growth, higher disposable incomes, and overall low air transport penetration levels of less than 3%. However, the Indian Aviation Industry has been going through a turbulent phase over the past several years, facing multiple and prolonged difficulties through which carriers are continuously underperforming financially. After conducting a set of expert interviews backed by a statistical analysis of secondary data, this paper concludes that restrictions on foreign ownership, outdated regulatory policies and overtaxed fuel, overlain by industry wide overcapacity issues are the major contributing factors.

Suggested Citation

  • O′Connell, John F. & Krishnamurthy, Pukezhenthi & Warnock-Smith, David & Lei, Zheng & Miyoshi, Chika, 2013. "An investigation into the core underlying problems of India's airlines," Transport Policy, Elsevier, vol. 29(C), pages 160-169.
    • Handle: RePEc:eee:trapol:v:29:y:2013:i:c:p:160-169
    DOI: 10.1016/j.tranpol.2013.05.002
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    References listed on IDEAS

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    1. Enrico Marelli & Marcello Signorelli, 2011. "China and India: Openness, Trade and Effects on Economic Growth," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 8(1), pages 129-154, June.
    2. O’Connell, John F. & Williams, George, 2006. "Transformation of India's Domestic Airlines: A case study of Indian Airlines, Jet Airways, Air Sahara and Air Deccan," Journal of Air Transport Management, Elsevier, vol. 12(6), pages 358-374.
    3. World Bank, 2008. "World Development Indicators 2008," World Bank Publications - Books, The World Bank Group, number 28241.
    4. World Bank, 2008. "World Development Indicators 2008," World Bank Publications - Books, The World Bank Group, number 11855.
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    1. Lasitha Nagahawatte & John F. O’Connell, 2016. "An analysis of the issues and prospects facing SriLankan Airlines and its embedded partnership with Sri Lankan tourism," Tourism Economics, , vol. 22(5), pages 908-927, October.
    2. Pearson, James & O'Connell, John F. & Pitfield, David & Ryley, Tim, 2015. "The strategic capability of Asian network airlines to compete with low-cost carriers," Journal of Air Transport Management, Elsevier, vol. 47(C), pages 1-10.
    3. Chandra Mahapatra, Subas & Bellamkonda, Raja Shekhar, 2023. "Higher expectations of passengers do really sense: Development and validation a multiple scale-FliQual for air transport service quality," Journal of Retailing and Consumer Services, Elsevier, vol. 70(C).
    4. Singh, Jagroop & Sharma, Somesh Kumar & Srivastava, Rajnish, 2019. "What drives Indian Airlines operational expense: An econometric model," Journal of Air Transport Management, Elsevier, vol. 77(C), pages 32-38.

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