India’s aviation scene is about to get more competitive with the arrival of Shankh Air, a new airline that has received approval from the Civil Aviation Ministry to operate within the country. This approval represents a major step towards Shankh Air’s launch, marking a significant addition to the already dynamic Indian aviation market.
Based in Uttar Pradesh, Shankh Air has set its sights on connecting major cities across India, focusing particularly on underserved regions with limited direct flight options. The airline plans to establish hubs in Lucknow and Noida, providing connectivity through both inter and intrastate routes. However, before taking to the skies, Shankh Air must obtain clearance from the Directorate General of Civil Aviation (DGCA).
Shankh Air’s entry into the Indian aviation landscape comes at a time of consolidation and competition. Currently, IndiGo dominates the market with over 60% market share, firmly establishing itself as the largest airline in India. Air India, the second-largest, is aggressively expanding its operations. It plans to absorb Vistara, a joint venture between Tata Group and Singapore Airlines, by next year, subject to antitrust approval. Air India is also acquiring AirAsia India, merging it with its low-cost subsidiary, Air India Express, further solidifying its position in the market.
This consolidation is creating a scenario where larger airlines are becoming increasingly dominant, while smaller players are facing challenges. Go Airlines India Ltd. ceased operations in May due to financial difficulties and engine failures, struggling to secure funding for a revival. Similarly, SpiceJet, a low-cost carrier, has reported continuous losses over the past five years and faces mounting financial challenges, including defaults on lease payments. This has led to insolvency proceedings, and SpiceJet’s market share has significantly shrunk, dropping from 5.6% in January 2023 to 2.3% by August. The airline, which held a substantial 10.5% market share in 2021, is fighting to raise funds to stay operational.
Despite the challenges, new entrants like Akasa Air and Fly91 are carving out their space in the industry. Akasa, founded by late investor Rakesh Jhunjhunwala, and Fly91, led by Harsha Raghavan and Manoj Chacko, are determined to make their mark amidst the established players.
Shankh Air’s mission to improve connectivity in underserved areas could provide much-needed relief to regions currently lacking adequate air travel options. The airline’s focus on these areas aligns with its goal of enhancing regional mobility across India. The approval letter from the Ministry of Civil Aviation emphasizes the need for Shankh Air to comply with relevant foreign direct investment (FDI) regulations, Securities and Exchange Board of India (SEBI) guidelines, and other applicable rules. The granted No Objection Certificate (NOC) is valid for a period of three years.
The Indian aviation sector is constantly evolving, with new players entering the market and established airlines vying for dominance. How Shankh Air navigates this dynamic landscape and fulfills its promise to connect underserved regions will be a story to watch in the months and years to come.
