The International Air Transport Association expects India to displace the United Kingdom as the third-largest aviation market in the world by 2026, with 278 million passengers. By 2035, the number is expected to grow to 442 million passengers. Currently, the country’s airport sector supports 8 million jobs and adds $72 billion in gross domestic product.

“Realizing that growth means that we will need to accommodate the potential of 322 million new passengers in just two decades. That will be a real challenge. Without significant change, the economic and social development potential gains that come with a healthy and growing air transport sector are put at risk,” said Alexandre de Juniac, director general and CEO, IATA.

The IATA is calling for a fresh look at India’s airport privatization, aviation taxation and sustainability. “Air transport contributes enormous value to India, stimulating growth and development with increasingly accessible air connectivity. India’s air transport industry has been through tough times. While many Indian airlines are now posting profits, the sector is still in loss territory with many challenges. These include a massive debt burden, onerous regulations, expensive airport infrastructure and high taxes. Addressing these will bring huge social and economic benefits to India,” added Juniac.

Currently, India awards airport concessions to further develop its infrastructure, which, while improving passenger experience, does not necessarily mean positive impacts for airlines. Airlines in India are facing large cost increases, thanks to 46 per cent concession fees charged by the government.

In addition, while many world governments reached a global agreement in aviation carbon offset and reduction earlier this month, India was not among the participants. IATA is urging India to come aboard the emissions agreements during the voluntary period.