India’s decision to reintroduce the Open Sky Policy for foreign cargo carriers marks a significant step towards enhancing efficiency, competitiveness, and exports in the country’s air cargo sector. After nearly three years of restrictions, this move holds promise for revitalizing the industry and contributing to India’s economic growth.
During the COVID-19 pandemic, international carriers faced limitations, operating solely from six metro airports in India. This restriction led to substantial losses for airlines and airports alike, prompting a need for policy revision to support the struggling sector.
Despite the challenges, Indian carriers seized the opportunity by increasing their cargo capacity, bolstered by the government’s revision of the Open Sky Policy in December 2020. This shift resulted in a notable uptick in the share of international cargo traffic and revenue for domestic airlines.
Initially met with resistance from exporters over reduced goods capacity, the Ministry of Civil Aviation reinstated the Open Sky Policy to facilitate air cargo movements. This move aims to support Indian carriers in expanding their capacity and navigating the evolving market dynamics.
Industry stakeholders, including airports, airlines, exporters, and industry associations, have warmly welcomed the government’s decision. They anticipate significant benefits such as improved efficiency, expanded exports, and alignment with the government’s ambitious economic targets.
The revival of the policy is expected to spur infrastructure development at non-metro airports, enhancing their cargo-handling capabilities and unlocking additional export capacity. Additionally, by providing better connectivity closer to cargo-origin points, congestion issues at major hub airports are poised to be addressed effectively.
Foreign airlines are showing renewed interest in resuming cargo operations in India, with several carriers announcing plans to introduce new routes. This renewed engagement underscores the positive impact of the policy change on fostering a dynamic and competitive air cargo environment.
The reinstatement of the Open Sky Policy represents a collaborative effort between stakeholders and policymakers. This move is anticipated to fortify the Indian economy, stimulate growth in the air cargo sector, and ultimately benefit exporters and the broader economy.
