The proposed merger of Air India and Indian marks the beginning of the consolidation era in the Indian aviation space.

In line with the global trend of consolidation, the stage is all set for the Indian aviation industry to create a single mega national carrier which is also poised to become South Asia's largest airline. Touted as the mother of Indian aviation mergers, the merger of Air India and Indian is expected to form India's largest airline with a clout to take on the domestic and international competition.

The formal approval given for the merger by the Union Cabinet on March 1, 2007 paved the way for the birth of the Rs. 15,500 cr airline which is almost thrice the size of its closest domestic rival, Jet Airways. Catapulting its position to be among the top 30 league of airlines in the world, the new jumbo entity has the potential to regain the dominant market share that the two state-owned airlines once enjoyed, provided proper restructuring efforts are put into practice. Though the cost of integration of the merger is estimated to be around Rs. 200 cr, it is also expected to reap a net benefit of Rs. 600 cr by the end of the next three years.

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