Via Prime Minister Modi’s “Make in India” program, India is to be transformed into a global industrial powerhouse. The program will ostensibly provide the Indian economy with the international recognition it deserves, facilitate new investment, foster innovation, and create a world-class infrastructure, including new airports en masse. But the passengers are missing.
Although “Make in India” is about giving a boost to industrialisation, it is infrastructure development which is the corner-stone of the program. So-called “top visionary projects” within, eg seaports, highways, industrial corridors, railways, and aviation with a total price tag of about $34bn, are to be realised in the next five years. Much money will be spent, and much profit can be made by those who find themselves in the right place at the right time.
In the overall “Make in India” picture, aviation is a relatively small sector. But it is important, and some believe, that international airports can be just as important an economic catalyst as seaports were in the 18th century, the railways in the 19th century, and highways in the 20th.
This is apparently an opinion shared by India’s Ministry of Civil Aviation: Rs100 spent on air transport produce benefits worth Rs325 for the economy, and 100 additional jobs in air transport result in 610 new economy-wide jobs, it is claimed. The idea, then, is that airports will serve as new engines of regional growth, something that India’s fast-growing passenger volume is expected to facilitate.
India today has very low, so-called “aircraft penetration,” that is, a low number of aircrafts relative to population size, compared to the other BRICS countries. India is only the world’s 9th largest aviation market, with 121 million domestic and 41 million international passengers annually. But, by 2020, it is estimated that they will have added 250 million new travellers and 600 new commercial aircrafts, thus becoming the world’s 3rd largest aviation market. By 2030 it aims to have 250 fully operational airports.
But the numbers may not add up. Not long ago, pictures of India’s ghost airports travelled around the world. The true horror story is that of the airport in Jaisalmer, which was completed in early 2013. It cost $17m to build but, to date, not a single passenger has travelled to or from Jaisalmer by plane. And Jaisalmer is not alone. Several Indian airports stand chronically empty, and this year, around a hundred of them have not seen a single commercial aircraft arrive, even if some of these airports are used by chartered flights.–
From the point of view of transport economics, there is, thus, good reason to reconsider the thesis that airports can, without further ado, boost the local economy wherever they are placed.
But it seems that airport construction continues unabated. Bihar, which goes to the polls next year, was recently promised, by Prime Minister Modi, four brand new airports in the near future.
And on India’s west coast, new airports are coming up in Chipi (Maharashtra), Mopa (Goa), and Karwar (Karnataka). The drive from Chipi airport in the north to Karwar airport in the south will take you four or five hours by car; on your way you pass both Mopa airport and the existing international airport at Dabolim (Goa). This can hardly be called low airport penetration.
But transport economic considerations are not always what count the most. Just as the locations of India’s many steel towns during Nehru’s time were determined by a “steel politics” partly influenced by federal bargaining, compromises, and myriad political considerations, a comparable “airport politics” is at work when a new airport is put on the map.
The BJP probably hopes that a generous pledge of four new airports in Bihar can help lure voters into the Hindu fold. For well-placed politicians and other bureaucratic middle-men, there is much to be gained by handing out contracts to the right business people in the right places each time a new airport is to be built.
And, for contractors and land and property dealers, there is always big money to be made from building airports and associated infrastructure. Whether they are subsequently successfully used for the purposes for which they were built is of less importance. The sad story of Jaisalmer airport may not be the last of its kind.
