Opportunities Open Up: Aviation sector to benefit from a robust pipeline under the NIP

Aviation sector to benefit from a robust pipeline under the NIP

Among the fastest growing businesses in the world, India’s airport operations have progressed to become the third-largest do­mestic civil aviation industry in the world, with substantial growth potential. In recent years, the Indian airport industry has ex­perienced a sharp rise in investment from both the public and private sectors. To keep pace with this rapid expansion, additional in­vestment in new airports, as well as the development of current airport infras­tructure, is re­quired in pursuance of future gro­wth. The Na­tio­nal Infrastructure Pipeline (NIP), whi­ch was unveiled in August 2020, has a lofty in­ve­st­ment goal of Rs 111 trillion and will be com­pleted by 2025, according to the government.

National Infrastructure Pipeline

For fiscal years 2020-25, the NIP proposes a capital expenditure of Rs 1.43 trillion to en­han­ce passenger handling capacity. A number of projects, including the construction of new terminals, runways, taxiways and parking facilities, are now being executed to achieve this goal. Ma­ny airports are being developed as a result of the Regional Connectivity Scheme – Ude Desh Ka Aam Nagrik (RCS-UDAN), and terminal buildings are being expanded to increase amenities and passenger handling capacity.

The centre and state governments are expected to spend a total of Rs 1,434.48 billion between fiscal year 2020 and fiscal year 2025 under the NIP. The Centre will be responsible for the execution of about 58 projects that have been authorised. These projects are expected to need a capital investment of Rs 891.67 billion in terms of capital expenditure. Of these 58 projects 52, with a total cost of Rs 371.88 billion, will be implemented using the engineering, procurement and construction method, while six projects with a total cost of Rs 519.8 billion will be completed using the public-private partnership (PPP) approach. The eight entirely greenfield projects would incur a total capital expenditure of Rs 361.47 billion between fiscal years 2020 and 2025.

New airports being built at Navi Mumbai, Mopa (Goa), Jewar, Itanagar, Bhogapuram, Dho­­lera (Gujarat), Agatti and Rajkot are among the projects that are entirely greenfield in nature. A number of existing airports, notably those in Chennai and Trichy, are receiving upg­rades and modernisation, while expansion work is also ongoing at the international airports of Delhi and Bengaluru.