Aviation industry to grow in long term: ICRA

New Delhi: The aviation industry in the country is expected to grow in the medium to long term but is likely to continue incurring losses in the near future, according to rating agency ICRA.
Over the long term, domestic and international passengers are expected to increase at an annual rate of 20 percent and 16 percent respectively, resulting in an overall increase of about 19 percent per annum.
"Growth in aviation traffic is expected to be driven by GDP growth, rapid expansion of higher income and upper income group of the population, continued liberalisation in the sector and emergence of low-cost airlines and apex fare system," ICRA said in a recent report.
However, in the short-term the industry is expected to continue to make losses because of over capacity, falling domestic traffic, high fuel prices and increased borrowing costs.
The report also points out that low-cost carriers are expected to continue exerting pressure on airfare, consequently aiding passenger traffic.
08/11/09 ZeeNews

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Categories: Indian Aviation- In General Nov 2009