Largest Aviation Market

Industry experts predicts, India is expected to become the third-largest Aviation Market in the world by 2026.

There are areas, where one can expect changes in Indian Aviation Industry in the future (mainly Cargo / Air Freight Sector).

Growth of the Indian Aviation Industry:

Expected to grow significantly in the coming years, driven by factors such as an increasing middle class, economic growth, and government initiatives to improve airport cargo infrastructure and regional connectivity.

Increased Air Cargo Traffic:

Indian airports are expected to handle a huge volume of Air Cargo, which is going to be more than ten times compared to the current Export / Import Tonnage.

This growth in Air Cargo traffic will require the construction of many more Air Cargo Facility with the modern infrastructure to support the growth.

Improvement in Airport Infrastructure:

The Indian Government has plans to invest in airport infrastructure development, including the construction of exclusive new Airports to handle the Air Cargo movement and the expansion of the existing ones.

This will help to improve the overall Cargo experience and increase the capacity of Indian Airports.

Initiatives for Indian Aviation

Initiatives for Indian Aviation:

The Agricultural and Processed Food Products Export Development Authority (APEDA) was established by the Government of India under the Agricultural and Processed Food Products Export Development Authority Act passed by the Parliament in December, 1985 to boost the perishable cargo movement through air.

APEDA is given the responsibility of export promotion and development of the following scheduled products:

  • Fruits, Vegetables and their Products.
  • Meat and Meat Products.
  • Poultry and Poultry Products.
  • Dairy Products.
  • Confectionery, Biscuits and Bakery Products.
  • Honey, Jaggery and Sugar Products.
  • Cocoa and its products, chocolates of all kinds.
  • Alcoholic and Non-Alcoholic Beverages.
  • Cereal and Cereal Products.
  • Groundnuts, Peanuts and Walnuts.
  • Pickles, Papads and Chutneys.
  • Guar Gum.
  • Floriculture and Floriculture Products.
  • Herbal and Medicinal Plants.
  • De –oiled rice bran.
  • Green pepper in brine.
  • Cashew Nuts and Its Products.

The Journey has Begun:

Logistics firms are doubling on their strategies when it comes to smaller cities. More than half of the overall revenue for Xpress bees comes from outside the top ten cities, says a report by Livemint.

While Ecom Express gets 65% of its parcel volume from Tier 2 and 3 cities, Shadowfax has witnessed a 30% year-on-year rise in delivery from these regions. Delhivery, too, has seen a steady increase in order frequency from these cities.

The growth is due to increased e-commerce penetration, which has pushed the need for better infrastructure to cater to delivery demands, says Varun Laul, Partner at Investcorp.

The e-commerce sector in India is expected to grow up to $300 million by 2030, the report says.

In other words, India’s warehousing sector is at the brink of a major transformation, setting the stage for ground breaking advancements in logistics.

The writing on the wall is clear: India is gearing up for a future to welcome the Air Freight Industry.

For instance, the construction of India’s largest cargo terminal at “Noida International Airport”.

In addition, the “Airports Authority of India” has transformed the Air Cargo unit into – AAI Cargo Logistics and Allied Services Company Limited.

All these are focussed towards welcoming next-generation air cargo with an aim to improve the seamless customer experience.

Key Emerging Trends of Aviation Industry in India:

Technological Integration: From manual to automation, technology is redefining warehousing operations, promising enhanced accuracy at a low cost.

The Indian air cargo industry has adopted the new technology such as bar code scanning, e-documentation, SMS alert to the customers at every stage, installation of an automated cargo storage and retrieval system to handle the small size shipments at each and every Air Cargo Terminal within India.

An automated Cargo Operations floor to increase the overall output. As the Airlines are bringing advanced and bigger cargo planes into their daily services, there should be adequate facility at the ground level to handle the same.

  • Environmental concerns: The Indian aviation industry is expected to focus on sustainability and reducing its carbon footprint, with initiatives such as the use of alternative fuels, electric aircraft, and green cargo terminals. Eco-friendly practices are becoming integral, driving the shift towards energy-efficient warehouses and electric logistics fleets.
  • Challenges: The Indian aviation industry faces challenges such as high taxes on aviation turbine fuel, lack of infrastructure, and a shortage of skilled personnel.
  • Job creation: The Indian aviation industry is expected to create a significant number of jobs in the coming years, with estimates suggesting that it will create over 70,000 direct and indirect jobs by the year 2024.

Air Cargo Industry targets fresh graduates (65%) and experienced personnel (35%). The vision is to add more to the workforce to explore the opportunity in front of India.

Government Initiatives for Indian Aviation:

Recognizing the critical role of air cargo in economic growth, the Indian government has launched initiatives to boost this segment. The focus has been on improving infrastructure, streamlining processes, and enhancing capacity.

  • The establishment of air freight stations and dedicated cargo terminals.
  • Implementation of the Air Cargo Community System (ACCS) to streamline cargo handling processes and reduce dwell times.

To support the booming aviation industry, the government has also focused on skill development and employment generation. Initiatives like the Aviation Skill Development Program and collaborations with educational institutions aim to train the workforce for various aviation-related roles.

  • The aviation sector currently employs over 4.2 million people, directly and indirectly.
  • Training programs have been established to upskill over 30,000 personnel annually.

FDI: The Indian aviation industry is expected to attract significant Foreign Direct investment in the coming years –

The government has liberalized its Foreign Direct Investment (FDI) policies to attract more investments in the aviation sector. Currently, 100% FDI is allowed in scheduled air transport services through the automatic route, and up to 49% FDI is permitted in domestic airlines under the automatic route.

  • Several international players have invested in Indian carriers, enhancing competition and service quality.
  • Several Foreign companies already investing in airport infrastructure development and Airline and Ground operations.


The Indian government’s multi-faceted approach to developing the aviation sector has yielded substantial results, positioning India as a key player in global aviation.

Through strategic initiatives like the UDAN scheme, comprehensive policy reforms, infrastructure modernization, and fostering investment, the government has created an enabling environment for growth.

The continued focus on expanding airport cargo infrastructure, and generating a competitive market will undoubtedly propel the Indian air cargo industry to new heights in the coming years.


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