Expect more consolidation in Indian skies: KPMG

Will enhance competition, expand spread of air connectivity to Tier 3-4 cities, bring down airfares for Indian passengers

Global consultancy firm KPMG expects more consolidation in Indian skies in view of regulatory challenges in domestic market.

"The Tata-AirAsia deal is in line with our estimate that the policy change will lead to equity deals in 2-3 existing airlines and 1-2 fresh start ups. This will enhance competition, expand spread of air connectivity to Tier 3-4 cities and bring down airfares for the Indian passengers.  We may also see some consolidation in line with what is happening in the US and EU," said Amber Dubey, partner and head-aviation at KPMG.

"India with its low flyer-base, regulatory challenges and high cost structure - cannot afford more than four strong national airlines", Dubey added.