By IANS
New Delhi : Concerned over losses and declining margins of air carriers, the Economic Survey for 2007-08 Thursday suggested consolidation to ensure optimal use of resources.
This is despite the fact that the civil aviation sector is growing rapidly and the government giving “in-principle” approval to import 496 aircraft in the next five years, the survey said.
More than 250 aircraft are likely to be acquired by airline operators, it pointed out.
The survey said that the process of consolidation has already begun.
“The recent mergers and acquisitions that have occurred in public and private sector airlines are expected to enable the airlines to increase revenues through synergies in operations and by ensuring optimal utilisation of resources in this capital-intensive sector.”
Public sector carrier Air India has merged with Indian, private airline Sahara merged with Jet Airways and Air Deccan merged with Kingfisher in recent times.
The merger of Indian and Air India would provide an integrated international and domestic footprint, which will enhance options and alternatives to air passengers, the survey said.
It also spoke about the number of air passengers doubling between 2004 and 2007. Air cargo traffic had also increased by over 45 percent between 2003-04 and 2006-07, it added.
The survey said air passengers would be empowered once the Airport Economic Regulatory Authority starts operation.