Union Budget 2017: Allow private airport operators to raise funds via tax free infrastructure bonds, says FICCI
Union Budget 2017 should facilitate private airport operators to raise funds by allowing them to issue tax free infrastructure bonds, recommends FICCI. In its pre-Budget 2017 memorandum, the Federation of Indian Chambers of Commerce and Industry (FICCI) said, “To facilitate the private airport operators to raise funds, it is recommended that they should also be allowed to issue tax free infrastructure bonds to the public.” “Further, the investments in these bonds should be notified for the purpose of claiming deduction under Section 80CCF of the Act by restoring section 80CCF in the Act,” it said. FICCI also urged Finance Minister Arun Jaitley that the deduction limit under section 80CCF of the Act for investment in infrastructure bonds should be increased from Rs 20,000 to Rs 50,000. According to Aviation minister Ashok Gajapathi Raju, the domestic aviation sector is on an “upswing”. “Indian aviation industry is on the upswing and today stands at an inflection point in its chequered history. We have recorded an exceptional growth in the past two years,” he said last month. Domestic air passenger growth has been more than 20 per cent for nearly two years while local carriers are also embarking on significant fleet expansion plans. Scott Wilson Authentic Jersey
GMR cites ‘execution challenges’, may exit Navi Mumbai airport project
The Navi Mumbai Airport project has run into trouble, days before the January 9 deadline for submission of financial bids, with at least two bidders — GMR Airport Ltd and MIA Infrastructure — among the four short-listed companies expressing concerns over likely delays in project execution. The companies have written to the City and Industrial Development Corporation (CIDCO), the project’s implementing authority, saying pre-development work, site preparation and rehabilitation of project-affected people (PAP) is yet to be completed. In separate letters, they have urged CIDCO to extend the deadline for submission of financial bids and sort out the problems before deciding on a fresh deadline. The four companies — GVK Mumbai International Airport Pvt Ltd (MIAL), GMR Airport Ltd, MIA Infrastructure (a joint venture of Tata Realty and Vinci Concessions of France) and Zurich Airport-Hiranandani Construction consortium — need to submit financial bids as per the deadline. J.J. Watt Womens Jersey
India to play hardball for equitable share of slots at foreign airports
India may make allocation of slots for its airlines an essential part of any bilateral treaty signed in future. This is after hectic lobbying and repeated complaints by airlines that they were being overlooked in terms of peak time slots. According to sources in the civil aviation ministry, there has been a mutual consensus between the civil aviation and external affairs ministry that countries showing interest in increasing seat allocations will be pushed to give slots to Indian carriers of their choice. “We are a big market in terms of passengers; a lot of foreign airlines want to expand in India, there is no fault if we intend to play according to our position of strength,” says a senior civil aviation ministry official. “There is a consensus in the ministry that we need to be more vocal about our carriers,” added the official. Indian carriers have long been complaining that not getting slots in foreign airports hampers their scheduling, hence curbing the viability of profitable overseas operations. Pat Lafontaine Authentic Jersey
Indian aviation takes off but growth weighs on airports
After a long rough patch, Indian aviation is finally booming, but that burst of growth is now taking a toll on the industry’s infrastructure. High operating costs, intense competition and the collapse of Kingfisher Airlines had weakened both business and civil sectors in previous years, but recently the Indian market has turned a corner into the world’s fastest growing, largely thanks to supportive government policies. India is currently the sole bright spot in Asia’s aviation sector, Neil Book, CEO at the largest independent aviation firm JSSI, told CNBC’s “Squawk Box” on Wednesday. Private jet sales are up and the emerging middle/upper classes have witnessed double-digit growth rates in travel, he explained. The upper middle class made up 8 percent of the population in 2015, and is set to hit 12 percent by 2020, according to Boston Consulting Group. Meanwhile, the ultra-high net worth population–defined as those whose net worth exceeds $50 million–stood at 178,000 in 2016 and will increase 57 percent by 2021, estimates Credit Suisse. Unlike his predecessors, Prime Minister Narendra Modi has loosened industry restrictions that are set to increase new aircraft deliveries as well as in-service and used business jets, Book continued. Dustin Pedroia Jersey
Delhi airport authority collected Rs 9,450 crore extra charges from IGI flyers since 2014
Are passengers flying in and out of Delhi paying much more than they should? And will the extra charges collected by airlines from the passengers and paid to Indira Gandhi International Airport — a total of around Rs 9,450 crore in just over three years — ever be refunded to flyers? These questions have been raised by the Airports Economic Regulatory Authority (AERA) in a petition filed before the AERA Appellate Tribunal (AERAAT) over Delhi International Airport Pvt Ltd (DIAL) continuing to charge the higher charges pertaining to the first control period, or a stipulated five-year term, from April 1, 2009 to March 31, 2014. AERA had lowered the airport’s charges by a steep 96% for the second control period that came into force from April 1, 2014 and will go through to March 31, 2019. While this should have meant cheaper flights to and from Delhi, DIAL opposed the implementation of the lowering of charges at various legal forums and continued with the higher earlier rates. The case is yet to be decided. A concerned AERA recently moved AERAAT, saying, “The appellant is charging aeronautical tariffs as per the first tariff order, which has higher tariff than the second tariff order. Under the second tariff order, the target revenue to be recovered by the appellant is Rs 7,709.61 crore (approximately) and the aeronautical tariff has been fixed on that basis. However, from April 1, 2014 to June 30, 2016, the appellant has already earned revenue of Rs 7,257.15 crore (approx) which is about 94.13% of the target revenue for the second control period.” The petition added that DIAL which was currently recovering an estimated Rs 300 crore per month, would have accumulated around Rs 17,157.15 crore by the end of the second control period in March 2019. This would represent an excess of Rs 9,447.54 crore against the target revenue of Rs 7,709.61 crore. AERA warned that it would not be possible to have this excess amount refunded to passengers from whom it was collected, thereby creating an “irreversible and uncontrollable situation”. DIAL is recovering monies in excess of the projected revenue, thus defeating the whole purpose of fixing the aeronautical tariffs, the regulatory authority charged. In response, a DIAL spokesman said, “The tariff determination for the first control period was done in 2012 based on various principles adopted by AERA. Being aggrieved with certain principles adopted by AERA, DIAL filed an appeal in AERAAT in 2012. The decision on the aforesaid issue is still pending adjudication. This has led to recovery of tariff much lower than the rightful entitlement under the concession. In the meantime, AERA has used the same principles to determine the tariff for the second control period. We are awaiting judgement of AERAAT on the issues. Once these are resolved, DIAL expects material recalculation of target revenue of first and second control periods and as a consequence does not expect significant over-recovery accruing to DIAL.” For the second control period, DIAL had sought a 42.6% hike in aero charges, but AERA had brought them down by 96.08% in December 2015, leading DIAL to challenge the decision in multiple legal forums. While requesting the tribunal to decide on the issue expeditiously, AERA reasoned that the large amounts involved in airport projects are public money and every attempt should be made to safeguard such funds. AERA determines airport charges for major airports for five-year terms called control periods. Based on these, airlines have to pay airports and accordingly set passenger fares. Scott Harrington Womens Jersey
Green panel clears ToR for Rs 224 cr road project in Karnataka
To improve road connectivity, an expert panel of the Union Environment Ministry has cleared the terms of reference (ToR) for the Rs 224 crore state highway upgradation project from Kollegal in Karnataka’s Chamarajanagar district to Tamil Nadu border. State-run implementing agency Karnataka State Highways Improvement Project (KSHIP) has proposed improvement of 95 km length of state highway-79 from Hanur to Tamil Nadu border, including connectivity from Palar to Hoganakkal falls. The Expert Appraisal Committee (EAC) of the Union Environment Ministry recently examined the Karnataka government’s proposal. “The Committee, after detailed deliberations, recommended the proposal for grant of ToRs for the said road project and for preparation of EIA/EMP reports after public consultation,” a senior government official said. ToRs are guidelines for conducting environmental impact assessment (EIA) studies of projects, based on which EAC recommends or rejects environment clearances to the project. After EAC’s recommendation, the Environment Ministry grants or rejects green clearance to a project. As per the proposal, the KSHIP has reduced total length of the project road from 119 km to 95 km. Out of it, 81.78 km of road stretch passes via two wildlife sanctuaries–Malai Mahadeshwara and Cauvery Wildlife Sanctuary. The cost of the proposed road project is estimated to be Rs 224 crore. The state government has informed the EAC that it wants to first develop existing road from Kollegal to Hannur covering a length of 24 km on a priority basis because of public pressure for development of this stretch which is located outside the forest and wildlife sanctuary area. Jason Williams Jersey
Road Ministry seeks Rs 90,904 crore for 2017-18
Unhappy over the proposed reduction in budget outlay for 2017-18, the Road Ministry has requested the Finance Ministry to allocate Rs 90,904 crore to help complete ongoing highway projects in time and compensate for the toll revenue losses following demonetisation. The Ministry of Road Transport and Highways (MoRTH) said it needs higher allocation to carry forward the ongoing work and also to compensate concessionaires who lost revenue because of withdrawal of tolling following the demonetisation, a source told PTI. The Road Ministry conveyed it to the Finance Ministry that “as against our proposal of Rs 90,904 crore for Budget Estimate (BE) 2017-18, the indicated outlay for BE 2017-18 is only Rs 58,362 crore…The proposed reduction in allocation of national highways (NH) sector would cause a major setback in the progress of ongoing projects and in the achievement of targets,” the source added. The outlay for Revised Estimate (RE) 2016-17 is proposed to be reduced from BE 2016-17 outlay of Rs 57,976 crore to Rs 52,447 crore as against the proposal of the Ministry of Road Transport and Highways (MoRTH) of Rs 62,489 crore, the source said. “As MoRTH have substantial liabilities and 36,500 Km of NH projects costing more than Rs 3 lakh crore are in progress, the road ministry requested the Finance Ministry to restore its BE 2016-17 outlay of Rs 57,976 crore at RE 2016-17 stage so that payments for ongoing works and committed liabilities are not delayed,” he said. The Road Ministry said that in the absence of assured funding, it would not be possible to properly plan, prepare and award NH projects, involving a gestation period of 3 to 5 years. Therefore, MoRTH requested that in addition to restoring the RE 2016-17 outlay to Rs 57,976 crore, the full outlay as proposed should be provided for BE 2017-18, the source said. Thomas Morstead Jersey
Incentives to states progressing under UDAY: Piyush Goyal
The government will consider incentives for states whose power distribution utilities are progressing well under Ujwal Discom Assurance Yojna (Uday). Power minister Piyush Goyal on Wednesday asked power ministry to launch two-three schemes to laud efforts of states that have joined Uday and been able to revive their power distribution utilities losses. Assam and Telangana on Wednesday joined Uday, taking the count of states that are part of the discom revival scheme to 20. Tamil Nadu, with Discom losses of Rs 50000 crore, is likely to join Uday next week. Telangana is likely to reap net benefit of Rs 6116 crore to and Assam at Rs 1663 crore through Uday, an official statement said. Tony Esposito Womens Jersey
High Oil Prices May Spoil The Party For Indian Consumers and Economy
After being insulated from an increase in the domestic fuel prices, the ongoing upsurge in global crude oil prices could spoil the party for Indian consumers of petrol and diesel. India imports 80% of its crude oil requirements and any upward movement in oil prices casts an impact on domestic prices of petrol and diesel. Domestic oil companies announced an increase in prices of petrol and diesel by Rs 1.29 and 0.97 a litre in petrol and diesel respectively from Monday (January 2, 2017). Experts feel that more such hikes could follow if crude and product prices in the global oil market continue the upsurge. The sudden increase in oil prices in international market follows decision of oil cartel-OPEC to cut production. The volatility in oil prices can be witnessed from the fact that from levels of $26 a bbl in February, crude oil prices touched the highs of $55 in December, up 15% since OPEC decision on production cut. Every one dollar increase in global crude oil prices, the exchequer will have to shell out an additional Rs 9,126 crore every year. With high oil prices, India’s oil import bill for 2016-17 will be much above the estimated $66 Bn worked at an avg import price of $48bbl. India’s oil import bill was $64bn in 2015-16, $113 bn in 2014-15 and $143 bn in 2013-14. High oil import bill will therefore mean that the country will have to fight a higher Current Account Deficit. For consumers, high prices will mean paying more for their fuel and air ticket bills. High oil prices has a cascading effect on all sectors thereby triggering inflation. Low crude oil prices during 2015 and early months of 2016 had kept inflation under check thereby helping the government to trim CAD. Larry Fitzgerald Womens Jersey
China to invest $360 bln in renewable power over four years through 2020
China will invest 2.5 trillion yuan ($361 billion) in renewable power generation between 2016 and 2020, the National Energy Administration (NEA) said on Thursday, as the world’s largest energy market pushes to shift away from coal power. The investment will create over 13 million jobs in the sector, the NEA said in a blueprint document that lays out its plan to develop the nation’s energy sector in a five-year period. The NEA repeated its goal to have 580 million tonnes of coal equivalent of renewable energy consumption by 2020, accounting for 15 percent of overall energy consumption. Installed renewable power capacity including wind, hydro, solar and nuclear power will contribute to about half of new electricity generation capacity by 2020, the NEA said. Rickey Jackson Authentic Jersey