Shankh Air: India welcomes another player into the aviation industry

India’s aviation sector is likely to get a new name in its list as Shankh Air recently received clearance from India’s Civil Aviation Ministry. The ministry granted it the clearance; however, it needs DGCA approval to begin flying. 

Shankh Air has been registered the first scheduled carrier of Uttar Pradesh and plans to operate its services through Lucknow and Noida hubs. The airline aims to connect major cities across India, including interstate and intrastate routes that would cater to areas with high demand that at present do not boast direct flights. Already having got the nod from the ministry, it would be apt to note that Shankh Air would now have the obligation of following the rules of compliance on foreign direct investment, SEBI, etc. 

The No Objection Certificate granted by the airline has a validity of three years. Considering this, it would enhance connectivity to places with restricted choice of travel thereby increasing regional mobility in the country. 

IndiGo is, and remains at a dominant lead in the Indian aviation market with over 60% market share, and Air India, though not behind but way behind, which the airline is aggressively expanding. Air India’s plan to acquire Vistara, which is waiting for the all-clear from antitrust authorities, and planning a merger of AirAsia India with Air India Express shows how consolidation in the sector continues unabated. Consolidation seems to have been continued with more viable players strengthening their stranglehold, while the smaller ones are struggling with their woes mounting. The recent shut down of Go Airlines India Ltd for financial reasons says it all. However, the biggest one of them has been SpiceJet, battling losses and financial instability. 

This can lead to a market in which just a few airlines dominate, perhaps winning up to 75% of the market and curtailing consumer choice. According to Rajat Mahajan of Deloitte Consulting, consumers should expect higher price fares. 

Still, they haven’t been able to stop new entrants like Akasa Air and Fly91 from trying to muscle into this fortress of the veteran companies. As for the Indian aviation industry, all seems fine here. Passenger traffic has increased 15% year after year, and FY24 is no exception, touching 376 million. Domestic air traffic is expected to grow 6-8%, while international traffic is prone to increase 9-11% by March 2025. 

 The government is committed to increasing the airline connectivity The intention of increasing the country’s airport infrastructure was part of extending the UDAAN programme. 

As the Indian aviation market continues on its growth path, where elements of expansion coexist with consolidation, Shankh Air may bring in new options for travelers into this country and can also promote a positive change in the landscape of air travel in India.