The crucial need for improving air connectivity between Singapore and India and the developmental impact it will have on Singapore.

        Thirdly, the process of economic liberalisation in India has caused a large rise in the number of Indian business travellers who are investigating investment and other business opportunities in Southeast Asia. This is not only beneficial to Singapore because it opens up opportunities for Indian businessmen, but also for Singapore businessmen to venture to India to do likewise. Furthermore, business contacts can be fostered and more insight and first hand information would be available to Singapore businessmen who are tentatively planning to invest in India, as part of the burden of reconnoitring the Indian market would be lightened. The whole process would also enhance networking and co-operation between Singaporean and Indian businessmen.

Market Niche due to the state of civil aviation in India

        Another major benefit of increasing air connectivity between Singapore and India for Singapore is the situation of the civil aviation in India. Following years of economic protectionism in the civil aviation industry in India, the Indian national carriers have grown complacent and not are as efficient as they could be, because of a sense of security and lack of foreign and domestic competition that they have previously taken for granted. Air India and Indian Airlines have not been quick in responding to the liberalised industrial and economic climate and the forces of globalisation. Thus there is a lack of good access for tourist arrivals in India. Though Indian national carriers have improved in terms of frequency of flights to various cities in India and the region and the quality of service, they still lag behind world standards. To be successful in adapting to the changes of globalisation in the civil aviation industry airlines have to focus on increased privatisation and liberalisation as protectionism will only turn out to be a short term solution because in the long run this will result in technological and commercial obsolescence setting in as observed in the case of the Indian national carriers. Thus Air India and Indian airlines have an inability to expand their capacity to meet market demands for flights into and out of India. Because of the above-mentioned situation of the civil aviation industry in India this presents a substantial market niche for SIA to compensate for the Indian carriers inability to cope with growing market demand. The gradual decline of protectionism in the Indian aviation industry makes penetration for SIA and Singapore more viable and a lot easier. The recently adopted Banglore flights by SIA do help to satisfy and increase greater demand for seats to India because SIA flights from Singapore to Bangalore and Bangalore to Singapore are always full. Several advanced bookings also show that the flights both ways are always fully booked and many passengers had to be waitlisted or turned away due to a shortage of seat supply. Not only would it be possible for SIA to increase flights to the region but also organisations like the Civil Aviation Authority of Singapore (CASS) and SATS could work at a bilateral level with the Ministry of Civil Aviation and Tourism of India. This has the potential to profit Singapore immensely because it might allow Singapore to penetrate not just in terms of flights but also in terms of ancillary services such as catering, baggage handling and ground support and maintenance. A possible penetration and capture of economic potential could occur just like the way the Singapore cleaning firm Onyx does contractual cleaning and waste disposal work in Chennai. The situation is especially relevant now more than ever because of increased liberalisation.

Development of bilateral relations to foster trade and commerce                                During Prime Minister Goh's visit, India and Singapore signed A Declaration of Intent on the India-Singapore Comprehensive Economic Cooperation Agreement (CECA). One of the main components of the agreement would be a more liberal air services agreement, and open skies for charter flights. Other components were a programme of economic cooperation, including an India-Singapore fund with a target of US$1 billion to address investment opportunities in India, and a second India Centre in Singapore and tourism cooperation. Furthermore, Prime Minister Atal Behari Vajpayee recently announced an 'open skies' arrangement with the ten-member ASEAN to allow designated airlines from the regional grouping to run daily flights to India creating a much greater niche and easier access to SIA. There will also be synergy created between both countries and national airlines. Singapore has Free Trade Agreements (FTAs) with several countries and this will serve as a platform to foster continued political and social relations between India and Singapore. 

Indian preconception of Singapore as an electronics haven and the IT element

Another major reason why Singapore would benefit with increased air connectivity with India would be because of the Indians’ preconception of Singapore as an electronics haven. Before liberalisation returning Indians were subject to all sorts of taxes on goods brought in from overseas, especially for electronics goods. Following liberalisation, the situation has greatly improved and an individual coming into or returning to India is allowed to bring in 12,000 rupees worth of goods without being subject to taxation when previously the figure was just 6,000 rupees. This allowance might be and probably will be increased substantially in future with greater liberalisation.  This is very beneficial to Singapore, as many Indians travelling to Singapore would purchase large amounts of electronics goods from Singapore to bring back to India because they are relatively cheaper here. One must also bear in mind that computer parts are system components are very much sought after from Indians in the Information Technology (IT) line. Computer parts and systems are much cheaper in Singapore than in India and there is far greater scope for variety and quality. Bangalore is a major IT hub with large numbers of software professionals and other IT specialists who fuel a large demand for computer components and parts.  This factor coupled with the increase of flights to and from Bangalore and shopping centres such as Mustafa centre in Serangoon Road, which now opens for twenty-four hours a day has a large amount of potential for Singapore’s economic development.  

Developments for the Singapore tourism sector and economy

One should also consider the benefits wrought directly to tourism by increasing air connectivity. This can be understood by examining the nature of Indian tourists and the tourism strategy of Singapore as a whole. Even as can be seen from the recent SARS outbreak in Singapore, the volume of tourists from India declined a relatively much smaller extent compared to tourists from other countries of origin.   It must be noted that the average expenditure of an individual Indian tourist in Singapore amounts to approximately S$ 1574 per day. It is estimated that every million dollars spent by Indian visitors would increase Singapore’s GDP by S$ 777,213 and create 16.2 new jobs (MTI) and by 2006 visitors from India could contribute to almost S$1 billion and account for 19600 jobs. Furthermore 55% of Indian tourists are repeat visitors. Studies have pointed to a greater income multiplier effect in Singapore’s tourism sector when compared to that of other countries and this suggest the growing importance of the tourism industry to Singapore’s economy relative to other sectors.  The greater the income multiplier effect of a sector the more beneficial developing that sector of the economy would be because it would pay off greater dividends due to its higher multiplier effect compared to other sectors.  The increase of air connectivity between Singapore and India would also have a multiplier effect on the tourism sector because of its intrinsic inter-relation.

Singapore also stands to gain from increased air connectivity because Indians see Singapore as a place for a family vacation because of the good clean image and safety factor. Increased tourists arrivals would create a ‘spillover effect’ in the retail and transport and hospitality sectors. It might substantially increase the demand for hotel rooms and restaurants. Shopping centres would see a rise in business and local tour operators would have an increased amount of clientele with a whole assortment and variety of tastes to cater to. Furthermore because of the limited number of activities and places to visit in Singapore the success in tourism depends on a ‘hubbing strategy’ of portraying Singapore as an entertainment, shopping, food, tourist and even an arts hub. The ‘hubbing strategy’ is also coupled with the need for constant reinvention because of the natural limits and constraints to the tourist activities in Singapore.  Singapore should market this aggressively because the increasing number of Indian visitors to Singapore do not merely comprise of families but young single men and women who are more apt to be adventurous tourists because they are not tied down with family and related obligations.

Regional Competition

Yet one of the most pressing needs for improved air connectivity between Singapore and India is regional competition for tourism.

In 1997, India reported that 3.81 million of its nationals had travelled abroad and spent US $1.34 billion overseas and this increased to US $1.71 billion in 1998. This figure attracted the attention of tourism-based economies around the world, particularly in Southeast Asia

Needless to say it is not just Singapore that is out to capture the potential of Indian tourists in the regions but the other Southeast Asian countries as well. Tourism not only constitutes more than 10% of Singapore’s GDP but that of Thailand’s and Malaysia’s GDP as well. In Southeast Asia, these countries as well as Indonesia are aggressively contending with other to become the regional tourism hub with Malaysia emerging as Singapore’s main rival for inbound Indian tourists. Furthermore these countries have shifted their strategy, placing more emphasis on attracting regional tourists. The context of this regional competition is very pertinent especially to Singapore because it has the most lack of depth and comprehension in terms of tourist activities and places of interest due to its small size. Thus she is the most jeopardised due to her natural constraints in her scope for tourism. Singapore thus relies on constant reinvention to innovatively portray a new image has to rely on aggressive marketing strategy to revive her appeal every few years with revolving and changing themes. If Singapore does not increase air connectivity with India other countries will be quick to jump on the bandwagon to capture a bigger piece of the pie and this has the potential to undermine negatively impact her economy. However, it must be remembered that this does not spell disaster for the Singapore tourism industry. Instead of fighting change, Singapore should embrace it and learn to work it to her advantage. Because of Singapore’s lack of depth for tourist activities compared to other countries in the region she could act as a ‘gateway’ to other tourist destinations in the region and incorporate more short holiday packages of two to three days for travellers and tourists in transit to another country in the region. It should be remembered that Singapore still stands to gain if she is used as a stopover and transit centre for the rest of the region rather than being passed over altogether. This is especially important as the Asian financial crisis of 1997 illustrated. Because of the declining value of several Asian countries currencies relative to the currencies of European countries and others it became more affordable and cost effective for several tourists to holiday in these countries compared to Singapore because the relative currency depreciation of the Singapore dollar was not as significant.  In order to achieve this she has to work closely with the tourism sectors of the other Southeast Asian countries and beyond.    

Cultural linkages and National identity

Improved air connectivity in general also serves the twofold purpose of enhancing cultural linkages and acting as a nation-building symbol that serves as an advertising mechanism for the country. As flag carriers, airlines are taken to represent their nations and thus, they evoke a sentiment of national awareness and cohesion and become important symbols of nationalism. One has to only ponder the role of the ‘Singapore Girl’ in order to verify this effect and its efficacy in promoting tourism and engendering national consciousness. Furthermore, Singapore has a big Indian community and increasing air connectivity could enhance the traditions and customs and heritages of non-resident Indians (NRIs) in Singapore besides fostering closer ties with the NRIs and Indians in India. It also enables more NRIs in Singapore to possibly discover or gain more knowledge of their roots due to increased cultural exchange and opportunity to travel.           

Conclusion

        In conclusion it can be said that there are several political, economic and social developmental benefits for Singapore in increasing air connectivity between Singapore and India. Singapore has to work at overcoming the obstacles to improved air connectivity with India in order to ensure her economic sustenance and survival in the rapidly changing global environment.

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Bibliography:

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