Unfortunately, the future of aviation sector - growing at 25% annually and projected to grow at 20% annually for next few years - is bleak as long as it remains under govt control. Already the govt has stopped granting licences to new airlines to operate, as the present aviation infrastructure in the country is simply not enough. Under govt control its domestic airline “Indian” is at the #3 position. Indians when flying abroad want to avoid “Air India” like the plague. It is never the first choice of Indians. Moreover, the private airlines that are now flying are going deep into red due to rising fuel costs and lower airfares. The congestion of our airspace and at airports is also not helping the sector. To top it all, orders for about 400 new aircrafts are pending with Boeing and Airbus. As Indian govt is notoriously slow in decision-making, new aviation infrastructure will only come up at snail’s pace. By this time many of the players will find it simply unviable and pull out.
Complete privatisation at the earliest is the only answer. Sell off "Air India", "Air India Express", "Indian", and "Alliance Air". Then sell off all the airports except the strategically important ones. Allow private investment in developing existing airports and in building new ones.