HISTORYThe origin of Indian civil aviation industry can be traced back to 1912, when the first air flight between Karachi and Delhi was started by the Indian State Air Services in collaboration with theUK based Imperial Airways. It was an extension of London-Karachi flight of the ImperialAirways. In 1932, JRD Tata founded Tata Airline, the first Indian airline. At the time of independence, nine air transport companies were carrying both air cargo and passengers. Thesewere Tata Airlines, Indian National Airways, Air service of India, Deccan Airways, AmbicaAirways, Bharat Airways, Orient Airways and Mistry Airways.The Government nationalized nine airline companies vide the Air Corporations Act, 1953.Accordingly it established the Indian Airlines Corporation (IAC) to cater to domestic air travel passengers and Air India International (AI) for international air travel passengers. The assets of the existing airline companies were transferred to these two corporations. This Act ensured thatIAC and AI had a monopoly
over the Indian skies. These government-owned airlines dominatedIndian aviation industry till the mid-1990s.FACTORS AFFECTING DEMAND FOR AIR TRAVEL1.
In April 1990, the Government adopted
and allowed air taxi- operators tooperate flights from any airport, both on a charter and a non charter basis and to decidetheir own flight schedules, cargo and passenger fares. Changes in investment policies inaviation industry also helped in launching of new airlines. By 1995, several privateairlines had ventured into the aviation business. With the operations of these playerstaking off, the erstwhile monopoly Indian airlines¶ share begun to plummet.2.
Tourism promotion played an important part in increasing air traffic. With the incomingtourist traffic on the rise (as a result of Open Skies Policy), domestic and internationalairlines found new sources of revenues.3.
Lower airfares played a major role in increasing air traffic. With dropping fares, air travelhas become more and more affordable for the common people.4.
Growth in expendable income of Indians has led them to take to air travel rather thanspending 2 days in train for long distance travel.