Strategic Thought Transformation - The IIPM Think Tank

E N T R Y S T R A T E G I E S
Demand Analysis & Investments
in the global
Aviation Industry
FACTS ASSUMED WHILE
DEVELOPING THE PAPER
Assumption 1
The degree of change in per-capita income
(in terms of Purchasing Power Parity, PPP) is
directly proportional to the degree of change
in Gross Domestic Product (GDP), i.e if GDP
increases by x%, the per capita income (PPP)
will also increase proportionately, i.e. x%
Assumption 2
The frequency of air travel is directly proportional
to the dispensable income and is thus
directly related to PPP
Assumption 3
The pressure created by a rise in passenger
traffic will be offset by a substantial upgradation
in airport infrastructure and other facilities,
thus acting as no limitation on the rise
Road to Privatisation...
The Wright Brothers invented it way back
in 1903; and more than 100 years later,
we get the strong impression that Indians
– more for reasons of optional deficiency
– have actually acknowledged their invention!
Not surprisingly, just half-a-decade
back, air travel in India suffered from the
“Maharaja syndrome” and hence was professed
to be an elitist undertaking.
Even some years back, owing to the
high and prohibitive costs of air travel –
which perhaps acted well as a class-barrier
– the only folks who dared to step on the
civil flying machines were the rich and the
powerful. However today, this is viewed in
an incredibly diverse radiance – perhaps as
an essential vehicle not only for travel and
trade connoisseurs, but also as a primary
medium for the non-rich middle class traveller,
providing a hook-up to different parts
of India. There is absolutely no doubt that
the aviation industry forms a significant
part of any country’s infrastructure and
possesses vital ramifications indispensable
for the development of tourism and
trade, opening up inaccessible zones in the
country and providing stimulus to business
activity and economic growth.
Thanks to privatization and liberalization,
today we can actually look upon
aviation as a sector where boundless
amendments can be expected with rising
competition and elevation of the purchasing
power of the general masses. In the
early 1950s, all aviation activities in the
country were amalgamated into either
Indian Airlines (now Indian) or Air India;
and with the enactment of the Air Corporations
Act in 1953, this monopoly was
perpetuated till 1993 with the Directorate
General of Civil Aviation controlling every
An IIPM Intelligence Unit Publication STRATEGIC INNOVATORS
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