business potentialsin aviationand its: howthe ebtc project ...€¦ · boeing and airbus forecast...

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Cooperation Opportunities between EU and India in the transport sector

The EBTC project – European Business & Technology Centre

Business Potentials in Aviation and ITS: how the

EBTC project can support a better EU-INDIA

Cooperation

Sofia, 30 th June 2010

Speaker: Annalisa GAMBA

Ceipiemonte S.c.p.a. – Italy -

EBTC is a programme co-financed by the European Commission, managedfrom its Delegation in India, and co-ordinated by EUROCHAMBRES

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Focus: Aviation


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Global perspectives in aviation sector

• Aerospace & defense companies are investing in new markets to pursue the customers and relationships that will help drive sales growth over at least the next 20 years

• By 2028 , regions outside Europe and North America are expected to own about half the commercial aircraft in service

(source: A&D Insights PriceWaterhouseCoopers –Boeing Current Market outlook 2009 - 2028)


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Global perspectives in aviation sector

• According to Indian Civil Aviation Ministry,

“within five years India will be breaking into

the top five aviation markets in the world”

• Led by India and China the Asia-Pacific

market is projected to grow more than 70%

making it the largest market in the world for

new aircraft

(source: Boeing Current market Outlook 2009 – 2028)


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Perspectives in Aviation Sector in India

• Economic development spurs demand for air

travel.

• By 2019 about 6% of India’s total GDP will

come from travel and tourism

• Travel and tourism will account for more

than 7% of total employment in India by

2019 equating to about 40 million jobs

(source: study by the World Travel & Tourism Council)


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• The Indian aviation industry is one of the fastest-growing aviation

markets in the world.

• With the liberalization of the indian aviation sector the industry has

witnessed a transformation with the entry of the privately owned full

service airlines and low cost carriers

• The sector shows a significant increase in number of domestic air travel

passengers

• Factors responsible for the higher demand for air transport include: (a)

the growing middle class and its purchasing power, (b) low airfares

offered by Low Cost Carriers; (c ) the growth of the tourism industry in

India; (d) increasing outbound travel from India; (e) the country’s

overall economic growth


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The aviation industry


• Prior to 2001, the aerospace and defence industries were exclusively reserved for Public Sector Units (PSUs). Consequently, these PSUs have grown tremendously by developing and acquiring new technologies and entering into the manufacture of indigenous aircraft

• Over the years, these PSUs have also helped a number of industries (large and small) to acquire technologies, technical and managerial processes, better quality standards, infrastructure and facilities, networking etc. This has helped the industry enhance its capabilities through exposure to flexible and modern manufacturing methods while simultaneously reducing the tolerance for cost and time overruns

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The aviation industry


• In 2001, the Government allowed 100% domestic private investment in the defence sector upon obtaining an Industrial Licence (IL) and FDI of up to 26% with conditions. Allowing private investment has begun to attract a number of Indian companies into the sector

• The introduction of the defence offset policy in 2006 and significant liberalization in 2008 has provided significant opportunities for Indian companies entering the sector. New players are entering the industry and are aggressively building capabilities to make them attractive partners for the primes and Tier-1 suppliers. Foreign companies are showing high interest in establishing their presence in India.

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• The rapid growth of this industry has attracted global aerospace majors to India.

• All segments within aerospace are showing tremendous growth, including civil aviation, military aviation and Space research

• Civil aviation — In 2007 and 2008, India assumed the ninth position in the world’s civil aviation market, an increase from 12th place in 2006. India’s air passenger travel has been growing at almost 25% a year. According to Government estimates, growth in this sector will outpace the global average until 2025.


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• Military aviation — Secondary research indicates

that India will spend about USD 35 billion on

military aviation over the next 20 years because

most of its existing fleet needs to be replaced. The

Indian Army is in the process of finalizing the

purchase of 197 helicopters


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• Space — India is one of the six countries in the world that undertakes Space launches. The Indian Space Research Organization (ISRO) under the Department of Space, Government of India, implements the Indian space programme involving the development and operation of satellites, launch vehicles and ground systems, for carrying out research and applications related to communications, remote sensing, meteorology and space sciences. India’s 2008–09 budget allocated a 16% increase in science spending from the previous year.


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Way forward

• Crucial Role of Governments and industry bodies in supporting the industry and encouraging the development of a critical mass of capabilities, technologies and suppliers

• Support from Government — The Indian Government has embarked upon several measures to develop and promote the aerospace sector.

• Support from Industry Bodies — Industry bodies in general have a crucial role in the creation and sustainability of an environment conducive to industry growth.

• Regulations and Taxes — India’s tax framework needs rationalisationand sector-specific incentives.


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Drivers of the Indian

aerospace market

Several factors driving the growth of IndiaSeveral factors driving the growth of India’’s aerospace industry:s aerospace industry:

•• the liberalization of civil aviation policiesthe liberalization of civil aviation policies

•• offset requirementsoffset requirements

•• a strong domestic manufacturing basea strong domestic manufacturing base

•• cost advantagescost advantages

•• a wella well--educated talent pooleducated talent pool


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Commercial Market


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Market growth rates


Source: Boeing Current Market Outlook

Despite the industry experienced

several downturn, during the next

20 years, there will be a

significant demand’s recovery

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World Passenger Traffic

Flows


According to IATA forecasts China, India and

Vietnam will be towed to the development of

demand for both domestic and international.

The Asian continent will increase the volume

of passengers transported by an average of

7%.

Source: Boeing Current Market Outlook

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Country’s snapshot


India is one of the most dynamic region for air travel

Indian major airlines - Jet Airways,

Air Deccan, Alliance Air and Kingfisher - have already bought

dozens of turboprop aircraft

Some important Italian

and Indian players of the sector are working to enhance their

business relationships

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In 2005, the Government for the first time authorized foreign investment in aviation

India today is attracting more new investments. The CAPA (Center for Asia Pacific Aviation) estimates that will be invested approximately 30 billion dollars over the next 5 years in infrastructure for air transport

Strong price competition among the region's airlines will serve to stimulate new demand, drawing millions of passengers away from the extensive rail network to much faster air services

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India has a total of 454 airports out of which 12 are international airports.

Wide-scale investment in airport and airspace infrastructure is imperative to

Southwest Asia's projected air travel market growth.

It is estimated that if 5% (800.000/day), passengers travelling by train every day

will make use of air transport, India will need additional capacity of 40,000 seats

per day.

Airbus's global market forecast also predicted that India will have an average

annual passenger traffic growth of 7.7 per cent until 2025.

Boeing and Airbus forecast that the Indian Air Force fleets will procure additional

1000 aircrafts over the next 20 years.

The steep rise in the number of flights makes it necessary to acquire the

appropriate management and air traffic control systems and new aircraft

dimensioned to the characteristics of the market

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India Business Success Stories


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Successful international cooperation agreements


Company Main activities

ThalesPresent since 2003 with Thales International India-management business in the country and entities participating in the JV with local companies.

EADS Present since 2006 with EADS India Private Limited. Creating a service center

setting up (in cooperation with local partners) for Engineering and IT.

Boeing Present since 2004 with Boeing International Corp. India Private Limited to support both civil and military aerospace activities.

Lockheed Martin Recently opened a JV subsidiary with local companies

BAe System BAeHAL SW Ltd. JV for SW and services. Further JV with HAL and TATA.

Russian Players Strong presence by the main player in Russia (Kamov, Suko, MIG, MIL, Ilyushin) mainly in the aviation and helicopter

Israeli Players In the aviation sector (principally UAVs), missile systems and C & C predominantly terrestrial

Chinese Players Far away.

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Italian potential cooperation agreements


Finmeccanica has answered the first requirement of the Indian market with

the technological capabilities of the systems of Selex Sistemi Integrati,

which over the years has provided radar equipment to the main airports of the country and who recently won the tender for the delivery of 13 radar

systems for air traffic control for the Indian Air Force.

Selex Sistemi Integrati is also in contention to win a contract to supply 30

three-dimensional transportable radar systems for the interception items at

low altitude for the Indian Air Force.

AgustaWestland is proposing to satisfy the requirement of Indian Navy

helicopters embarked on a modern middle class.

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India’s competitive scenario


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Local Players


Business Opportunities Indigenous players

Aircrafts, Helicopters, Satellite Structures/ Launch Vehicle

HAL, ISRO, ACF Systems Ltd.

Avionics, Radars HAL, BEL, Karnataka Hibryd Micro

Devices, Verdant Telemetry

Castings and ForgingsHAL Foundry Forge Division, Cardionics India, G-Plast Ltd, Investment and Precision Casting Ltd, Steel and Industrial Forging Ltd, Vishnu

Forge Industry.

Electrical/Electronics Component/Systems

Compupower Pvt., Elsonic Santo Corp., Flexitron, Southern Electornic Pvt., United Telecoms Ltd, Verdant Telemetry, Zener Systems Pvt., Zeonics.

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Local Players



HALPower Plants/APU, Starters

AEROSPACE ENGINEERS, Cardionics

India, Elastomerics Engineers, Meco

Lam, Mercury Metal Ltd., Polimer

Enterprise, Sujan Industries

Materials metallic and non metallics

HAL, Max & Aviation Ltd., Taneja and

Aviation Ltd., Varman Aviation Ltd.Maintenance, Overhaul and Engineering Services

ACME Engineering Co., Data Patterns,

Indos Industries Ltd., Kasco Industries,

Mak Controls and Systems, Mat

Incorporated, Merlinhawk Associates

Ltd., Sika Interplants Sytems Ltd.,

Southern Electronics Ltd., System

Controls

Ground Support Equipments, Measuring & Test Equipment

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Local Players



Government Tool Room & Training

Centre, HAL, National Aerospace

Laboratories, P-Met HighTech Ltd

R&D Lab. & Testing Lab

ACME Engineering Co., Godrey &

Boyce Ltd, G-Plast Ltd., Hampson

Industries India, HAL, Kobashi Machine

Tools, Kumaran Industries Ltd., Maini

Precision Product Ltd., Prathibha

Industries, Turbocam India

Precision Machined Parts

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Focus on ITS


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ITS –Intelligent Transport System


Keeping traffic moving is a problem faced

globally at all the levels of government

Possible solution: implementation of

Intelligent Transport System – ITS

ITS holds promise for a sustainable and

balanced transportation alternative

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ITS is essentially the application of

computer and communications

technologies coming in aid of the transport

problems

ITS technologies enable gathering of data

or intelligence and then providing timely

feedback to traffic managers and road

users

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ITS results in:

•Improved safety to drivers

•Better traffic efficiency

•Reduced traffic congestion

•Improved energy efficiency

•Environmental quality

•Enhanced economic productivity

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Examples of ITS include:

•Advanced Traffic Management Systems

•Advanced Traveller Information Systems

•Advanced Vehicle Control Systems

•Electronic Toll Collection Systems

•Advanced Public Transportation Systems

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ITS endeavour for Indian cities is initiated

with collaborative projects involving Local

Auhtorities, specialized organizations such

as the Department of Information

Technology, AITS India, research and

academic institutions

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Important initiatives:

Metropolitan and rural programme areas

are focused primarily on ITS infrastructure

Intelligent vehicle initiative aims to

accelerate the development and availability

of advanced safety and information

systems applied to all types of vehicles

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The intelligent vehicle initiative covers

applications for passenger vehicles,

commercial trucks, buses and specialized

vehicles.

Other special applications to emergency

response, police and highway

maintenance vehicles

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Many ITS applications are based on ongoing and recentlycompleted research on crash avoidance, in vehicle safety,

automated highway systems

Key factor: involvement of public and private stakeholders to

ensure that ITS solutions are technologically, socially,

institutionally and economically viable

Due to the complex technology convergences required for ITS

applications, auto and civil engineering, ICT, electronics, satellite

and mapping technologies, there is a need for a standard national

framework to facilitate interoperability and cost effectiveness

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Examples of ITS technologies and likely end users:

Traffic policeRed Light Violation Detection System

Traffic planners and development

authorities

Intelligent Traffic Congestion Management

System

General public and traffic plannersAdvanced Travellers Information Systems

Town planners and local authoritiesIntelligent Parking Lot Management System

Traffic planners and development

authorities

Real Time Traffic Counting & Monitoring

System

Medium and large cities deploying ATCSSecond Generation Area Traffic Control System

Traffic police and local authoritiesWireless Traffic Control System

LIKELY END USERSITS TECHNOLOGY

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Large Public Private Partnership programmes

• Indian Highways Infrastructure programme

• Key opportunities : installation of user friendlyElectronic Toll Collection (ETC)

• Ksrtc (Karnataka State Road Transport Corporation) will soon be implementing the ITS for Mysore city

under GEF (Global Environmental Fund) – SUTP (Sustainable Urban Transport Programme), the

initiative by World Bank

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Successful stories

• BRT – Bus Rapid Transit – Public Transport

Programme Jansmarg

• eCall – involvement of Indian company LogicaCMG

and important European companies

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THANK YOU


CEIPIEMONTE S.c.p.a.

Piemonte Agency for

Investments, Export and

Tourism

�Corso Regio Parco 27 – 29

10152 Torino – Italy –

�+39 011-6700.511

�+39 011 696.54.56

E-mail: [email protected]

business potentialsin aviationand its: howthe ebtc project ...€¦ · boeing and airbus forecast...

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