April 24, 2007: It seems to be merger season in the airline sector. Close on the heels of the decision to merge state-run carriers Air India and Indian, came the Air Sahara acquisition by Jet. A report in a national daily says that more mergers and acquisitions are to come in the coming days.

It has been reported earlier that SpiceJet, which now has the support of investors, is also considering buyouts. Over the next year, Kingfisher Airlines is expected to be the most aggressive in terms of fleet expansion The report which quoted officials from the Civil Aviation Ministry pointed out that consolidation will occur through a process of closure or mergers and acquisitions, leaving around two to three full service carriers, three to four large national carriers and three to four niche regional operators. The process, the report added, is expected to get rolling by this year itself.

However, officials believe that the overhang of foreign investment eager to enter the Indian aviation market might delay the process for a bit more time.

The industry, in the meantime, is eagerly waiting for the announcement of the Civil Aviation Policy soon. India today is said to be in an situation of having potentially billions of dollars of investment preparing to enter the sector, but the lack of a clear policy is a deterrent. The announcement of the policy might change the way things are seen.

The policy might lead to the clearing of the level of investment by foreign airlines in Indian carriers. The opening up of this could bring in the much-needed strategic investment and expertise.

With traffic expected to grow, Indian operators would have 480 more aircraft in the next five years, against the current fleet size of 310 aircraft, it is said..