India’s aviation industry faces challenges and opportunities at a critical crossroads. As the Union Budget 2025 approaches, it is crucial to address these concerns while paving the way for sustainable growth. Poonam Verma Sengupta, Partner at JSA Advocates & Solicitors, shares her expert insights and recommendations for transforming India’s aviation landscape.

Addressing Key Challenges

1. Global Supply Chain Delays: India’s aviation sector is grappling with significant supply chain issues, leading to delays in aircraft and engine deliveries. Over 100 aircraft remain grounded due to engine shortages and delays in spare parts.

Budget Recommendation: The government should introduce financial solutions, such as lowinterest loans, to support airlines in managing these disruptions.

Global Alignment: Strengthening compliance with the Cape Town Convention is essential to improving lessor confidence, especially in light of the impact of GoAir’s insolvency.

2. Operational Security Concerns:

Between August 2022 and November 2024, 1,143 hoax bomb threats were reported by domestic airlines, causing severe operational disruptions.

While the Aircraft (Security) Rules of 2023 have introduced stricter penalties, more proactive investigative measures are required to prevent such threats.

3. Connectivity in Smaller Cities:

Despite heavy infrastructure investments, Tier 2 and 3 cities continue to face low passenger demand, making operations unsustainable.

Proposed Incentives: Airlines should be encouraged to attract passengers through lower operating costs and improved airport infrastructure. This aligns with India’s Viksit Bharat 2047 vision, which aims to expand the airport network to 350.

4. Cybersecurity and Fare Control:

Airlines must strengthen cybersecurity for their operations and passenger data.

Additionally, the unregulated surge in airfares during festive seasons has raised concerns.

Policy Proposal: Establish a quasijudicial body to regulate air ticket prices, ensuring affordability for consumers.

Unlocking Opportunities

1. India’s MRO Potential:

The Atmanirbhar Bharat initiative has fueled the growth of the Maintenance, Repair, and Overhaul (MRO) sector.

With streamlined export/reimport norms and private investments, India’s MRO industry is poised for global leadership, creating new avenues for growth and employment.

2. Innovation and Infrastructure Development:

Leveraging technological advancements and attracting investments in aviation infrastructure can position India as a global aviation hub. Strengthening airport facilities and integrating sustainable practices will be crucial in this transformation.

Pathway to Growth

The aviation sector has showcased its potential, but its growth hinges on policy reforms and strategic investments. The Union Budget 2025 must prioritize:

• Financial support for airlines to overcome supply chain challenges.
• Proactive security measures to address operational threats.
• Connectivity enhancements for smaller cities to balance growth.
• Regulatory frameworks for affordable airfares.

With these measures, India’s aviation sector can unlock immense opportunities and align with its vision of becoming a global leader in aviation.