Market Trends of India Aviation, Defense, And Space Industry
Civil Aviation Segment to Showcase Remarkable Growth
- In recent years, the Indian aviation sector has experienced remarkable growth in operations, solidifying its position as the world's third-largest. An increasing population with a growing appetite for travel primarily fuels this surge. Consequently, there has been a surge in demand for modern aircraft to enhance the flying experience. In response, several commercial airlines in India are investing substantially in acquiring cutting-edge aircraft.
- For example, in September 2023, Air India secured its first A350-900 through a finance lease with HSBC. Air India placed orders for a total of six A350-900s. Five units were scheduled for delivery by March 2024. Furthermore, India has seen a notable rise in the number of new airport constructions. With a rising number of air passengers annually, existing airports in India are grappling with congestion and bottlenecks, prompting a surge in new airport developments. For instance, the Maryada Purushottam Shri Ram International Airport in Ayodhya was inaugurated in December 2023. Such infrastructural strides are poised to bolster the sector's growth in the coming years.
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The Weapons and Munitions Segment Dominates the Market
- India has significantly boosted its defense spending, driven by escalating border disputes, notably with China. This has prompted the Indian defense forces to prioritize acquiring advanced weaponry and ammunition, bolstering their capabilities. Simultaneously, numerous companies have partnered with India's defense sector, increasing their research investments to meet the military's evolving demands. For instance, in September 2023, the Indian Army announced plans for next-gen guns to be exclusively developed and manufactured by domestic firms with a hefty price tag of USD 60 billion. These new towed gun systems are touted to be lighter and more adaptable, boasting cutting-edge technology.
- India is also eyeing a global role as a manufacturing hub for advanced 155 mm artillery ammunition, a caliber favored by more than 75 armies worldwide. Underscoring this ambition, in February 2023, the Ministry of Defense awarded contracts to five domestic manufacturers. These contracts entail delivering around two thousand 155 mm terminally guided munitions (TGMs) for the Army's existing 155 mm guns, spanning 39, 45, and 52 calibers. With the uptick in indigenous weapon production and robust defense spending, this sector is primed for significant growth in the foreseeable future.
