Domestic air passenger traffic grows 21% in June
The domestic airlines carried 79.75 lakh passengers in June, a jump of 20.81 per cent over the 66.01 lakh passengers flown during the same period in the previous year. The latest data released by the Directorate General of Civil Aviation shows that IndiGo has retained its number one position having flown 30.23 lakh passengers with Jet Airways at the second position having flown 12.96 lakh passengers. The state-owned airline Air India carried 12.37 lakh passengers In addition, SpiceJet carried 10.10 lakh passengers in June this year while Vistara flew 2.27 lakh passengers. Vistara is a joint venture between Singapore Airlines and Tata Sons. AirAsia India flew 1.73 lakh passengers. Stephen Gostkowski Womens Jersey
Intervening to reduce overseas airfares will violate law: Government
Government intervening to reduce airfare charged by domestic airlines on international routes will not only violate Indian law but will also be anti competitive, Union Minister Jayant Sinha said today. Emphasising that airfares are driven by market forces, he said as the demand goes up, the seats on lower fare levels get filled. “An intervention by the government in the matter of airfare reduction of domestic airlines operating on international sector to protect the interest of NRIs (Non Resident Indians) would not only be in contravention of Indian law but also anti-competitive,” he told Rajya Sabha in a written reply. The Minister of State for Civil Aviation was responding to a query on whether the government is aware that in certain seasons airlines charge higher than norms in the case of Kerala-Gulf flights and whether the government would intervene. Sinha also said airlines are free to fix reasonable tariffs under the Aircraft Rules, 1937 after taking into consideration all relevant factors including the cost of operationa, characteristics of service, reasonable profit and generally prevailing .. Airlines remain compliant with regulatory provisions as long as the fare charged by them does not exceed the fare established and displayed on their website, he added. Fernando Rodney Authentic Jersey
PMO unimpressed with Air India’s improved financial performance, sets new targets
Air India may have improved its financial performance on the back of low fuel prices, but the Prime Minister’s Office (PMO) doesn’t seem convinced about the flag carrier’s revival story. The PMO has asked the airline to improve its performance on all fronts. It wants on-time performance improved to at least 85 per cent, revenues increased by 10 per cent and industry standards met on load factor, or capacity utilisation, and has also asked the airline to carry out a proper survey before inducting new aircraft. The targets were given at the PMO’s first official review of the airline, convened by the Prime Minister’s principal secretary, Nripendra Misra, on July 6. Loss-making Air India is set to report an operational profit for FY16, helped by Rs 2,700 crore of savings on account of lower fuel prices and a one-time gain of Rs 1,200 crore from the sale and lease back of Boeing 787 Dreamliners. But its revenue for the year is estimated to have increased only marginally even after accounting for the proceeds from the aircraft sale, which points to the risks faced by the state-owned carrier in an increasingly crowded market. The airline’s operational parameters have fallen short of industry standards: its on-time performance was the lowest in the industry at 74.3 per cent for May 2016, when its passenger load factor was 84.7 per cent. SpiceJet reported the highest load factor for the month, utilising 93.5 per cent of its capacity. A government official, who is aware of the discussions at the review meeting, said the PMO wanted Air India to improve performance. “There is no doubt that Air India’s performance has improved but that is on the back of lower oil price. The PMO has said that the airline needs to improve its revenue, which has remained flat during the last fiscal (year). The industry, during the same time, saw revenue increase by about 10 per cent,” said the official, who didn’t want to be named. The PMO also noted that the “benefits of reduced ATF was outweighed by the reduction in revenue”, the official added. During the meeting, Air India chairman Ashwani Lohani said the airline needs more manpower and the government should allow it to hire. Lohani also wanted the retirement age at Air India to be increased to 60 from the current 58. The PMO didn’t approve these, but asked the aviation ministry to look into the demands. “They said that the aviation ministry should examine both the proposals before taking a final decision,” said the official. Analysts said a solution to Air India’s problems could only be found after a detailed analysis by professionals. Stephen Curry Authentic Jersey
India discovers producible natural gas hydrates: US agency
India has discovered a large, highly enriched accumulations of natural gas hydrates in the Bay of Bengal that has the potential to be tapped, a top US agency which helped in this major discovery has said. “Advances like the Bay of Bengal discovery will help unlock the global energy resource potential of gas hydrates as well help define the technology needed to safely produce them,” said Walter Guidroz, coordinator of the US Geological Survey (USGS) Energy Resources Program coordinator. USGS said this discovery was the result of the most comprehensive gas hydrate field venture in the world to date, made up of scientists from India, Japan and the US. The scientists conducted ocean drilling, conventional sediment coring, pressure coring, downhole logging and analytical activities to assess the geologic occurrence, regional context and characteristics of gas hydrate deposits in the offshore of India, it said yesterday. This research expedition was called the Indian National Gas Hydrate Program Expedition 02. It is second joint exploration for gas hydrate potential in the Indian Ocean. The first expedition, also a partnership between scientists from India and the US, discovered gas hydrate accumulations, but in formations that are currently unlikely to be producible, a statement said. Natural gas hydrates are a naturally occurring, ice-like combination of natural gas and water found in the world”s oceans and polar regions. Although it is possible to produce natural gas from gas hydrates, there are significant technical challenges, depending on the location and type of formation. USGS said the second expedition focused the exploration and discovery of highly concentrated gas hydrate occurrences in sand reservoirs. The gas hydrate discovered during the second expedition are located in coarse-grained sand-rich depositional systems in the Krishna-Godavari Basin and is made up of a sand-rich, gas-hydrate-bearing fan and channel-levee gas hydrate prospects. The next steps for research will involve production testing in these sand reservoirs to determine if natural gas production is practical and economic, it said. “The results from this expedition mark a critical step forward to understanding the energy resource potential of gas hydrates,” said USGS Senior Scientist Tim Collett, who participated in the expedition. A.Q. Shipley Authentic Jersey
ONGC, Cairn India demand halving of cess on crude oil
State-owned ONGC and private sector Cairn India have demanded halving of cess on domestic crude oil production saying their burden has actually gone up after Finance Minister Arun Jaitley’s Budget exercise aimed at reducing the levy. Oil and Natural Gas Corp (ONGC) paid Rs 4,500 per tonne cess on crude oil it produced from almost all its fields including prime Mumbai High, till February 2016. In Budget for 2016-17, Jaitley changed the cess from specific levy to an ad valorem rate of 20 per cent of crude oil price. However, at the current oil prices, ONGC and other oil firms like Cairn are paying more than Rs 4,500 per tonne cess. Sources privy to the development said the two firms have made representation to the government saying the Rs 4,500 per tonne equals to 20 per cent ad valorem duty when oil price crosses USD 44 per barrel. And with oil prices ruling higher, the net impact of an exercise which was aimed at giving relief to domestic oil producers, is that they have to pay more now, they said. Historically, the Oil Industry Development (OID) cess was first levied in 1970s at the rate of Rs 60 per tonne. Over the next decades it was hiked few times. It was Rs 900 per tonne, when India opened up its economy in 1991 and was doubled to Rs 1,800 in 2002. In 2006, it was hiked to Rs 2,500 per ton when international oil price was USD 60 per barrel. It was further hiked to Rs 4,500 per ton in 2012 when oil pries were over USD 100 per barrel. Sources said the levy translated into no more than 10 per cent of the oil prices even when oil prices were at their peak. But when international oil prices slumped to decade low, putting question mark over fresh investments in exploration, Jaitley proposed to move to ad valorem rate of 20 per cent. The move was to give relief to upstream firms but has turned out to be reverse, they said. ONGC and other upstream players have sought reduction in cess to 8 to 10 per cent as the purpose of Budget exercise to rationalise the cess has been defeated even at current moderate crude prices. In a low crude oil price regime, cess imposes a significant economic burden on producers, they said. In addition to cess, other statutory levies like royalty (10-20 per cent), VAT (5 per cent) and Octroi (4.5 per cent) are also payable on production/sale of crude oil. At prevailing crude oil prices, with the revised rate of 20 per cent fro cess, ONGC would end up paying almost half of crude prices towards statutory levies, source said. Moreover, since both royalty and OID cess are production levies and not pass through to buyers, it adds up in cost of production of crude oil. William Jackson Jersey
Airlines’ costs set to soar over pilots’ crisis; here’s why
A fairly big shortage of pilots two years down the line — estimated at around 2,000 — could drive up costs for airlines. While employee costs constitute around10% of an airline’s overall revenues, the need to pay pilots more may push up expenses on this front. Although the country has over 5,000 commercial pilots currently, data from KPMG-Ficci reveal the sector could need close to 9,000 pilots in another two years. The planned expansion apart, carriers would also be looking to add aircraft now that they can fly overseas even before they have completed five years of operations provided they have a fleet size of 20. The civil aviation regulator DGCA typically issues about 800-1,000 commercial pilot licences (CPL) every year, which would mean the country would have around 7,000 pilots by 2018. However, the growth in the number of pilots doesn’t appear to have matched the growth in the fleet size. The current fleet size — commercial as well as chartered — is 850 and going by the orders placed, this should go up to around 1,000 by 2018. This would imply that against a requirement of 9,000 pilots for 1,000 planes, the supply will be closer to 7,000. Carriers are ideally required to have 10 pilots for each aircraft they operate. According to sector experts, the shortage will be higher because even after a pilot graduates from a flying school and gets a licence, he needs further training and cannot fly immediately. “Pilots as well as engineers will be a major problem in the future. One reason the projected fleet growth for this year is only 110 aircraft is because of pilots. There are lots of people in India who have CPL and PPL (private pilot licence) but in spite of that they are out of jobs as training on any one specific aircraft can be unaffordable to a lot of pilots with valid CPLs,” Dinesh Keskar, senior vice-president of sales in India for Boeing, told FE. He added that it takes $48,000 to train a pair of pilots. Currently, the DGCA recognises 30 flying schools across the country. It takes nearly two years for a trainee pilot to obtain a CPL but the pilot still needs to be trained on specific aircraft by an airline for a few months before being cleared for flying commercial jets. However, some flying schools like CAE Oxford in Gondia and Raebareli have tailor-made courses in partnership with airlines that expedite the induction of pilots into cockpits, making it easier for such carriers to fulfil the quota of pilots needed for their fleet. While such tie-ups cushion scheduled commercial airlines from a pilot shortage to a large extent, it makes it even more difficult for chartered operators to find trained pilots at an affordable cost. “Scheduled airlines alone would require about 2,000 pilots in the next two years and this poses a massive challenge for chartered operator to find trained pilots,” Bhupesh Joshi, CEO of the largest chartered operator Club One Air, told FE. He added that chartered operators end up spending more on pilots due to lack of training facilities in the country. “There was a similar projection regarding shortage of trained pilots in 2008 when the sector was expanding rapidly. However, due to the global recession, some airlines went belly up while others adopted cautious expansion plans thus avoiding pilot shortage situation,” said Abhay Krishna Agarwal, partner, infrastructure & PPP at Ernst & Young. Jeff Petry Womens Jersey
Metro rider for NHAI Dwarka Expressway takeover
Haryana chief minister Manohar Lal Khattar has directed Huda to hand over a 75-metre-wide corridor to the Union ministry of road transport and highways, for the latter to develop an elevated Metro on the corridor. This is against the ministry’s demand for a 90-metre-wide corridor, for two contiguous projects – increase the width of the Northern Peripheral Road (NPR) also known as Dwarka Expressway, and develop a proposed metro route over it. During the Happening Haryana summit in Gurgaon in March, Union roadways minister Nitin Gadkari had announced granting of National Highway status to the NPR, after a request by the chief minister. With that, it became imperative that National Highways Authority of India (NHAI) will take over the project from Huda. In a recent meeting with state government to discuss the handover of NPR to NHAI, the ministry had made the demand for the 90-metre-wide corridor, to increase the width of the road and add a few extra lanes. At present, the 8-lane NPR is 75m wide in Gurgaon. “Beyond the 75 metres already used up by the NPR, are lines for essential services like sewerage, drainage and water. Shifting all these services would be very difficult and cost intensive, so we can’t give any more land,” said Huda administrator Yashpal Yadav. The ministry had expressed its reservation about developing the metro corridor above the NPR, as proposed in the master plan. An NHAI official said that after taking over from Huda, they will first develop NPR, and if possible, also increase its width.
7 BOT road projects reach financial closure over last 2 years
As many as seven build-operate-transfer (BOT) road projects reached financial closure over the last two years, parliament was told on Monday. “Seven BOT projects have reached financial closure in the last 2 years. Some of the challenges faced by BOT projects are lack of equity with developers, over leveraged balance sheet of the developers, equity funded through borrowing by parent lender, stress on the existing road infrastructure loan portfolios of Financial Institutions (FIs), corporate debt restructuring effected in many special purpose vehicle (SPV) debt and sectoral exposure norms of FIs getting exhausted,” inister of State for Road Transport and Highways Pon Radhakrishnan told the Rajya Sabha in a written reply. He said that modes of delivery for implementing National Highway (NH) projects are BOT-Toll, BOT-Annuity, Hybrid Annuity and Engineering Procurement and Construction (EPC), but BOT-Toll remains the default mode of delivery subject to project viability on case to case basis. Major steps undertaken include emphasis on better project preparation including land acquisition, undertaking major policy initiatives and simplification of procedure for project appraisal, exit policy for concessionaires, amicable settlement of disputes, addressing issues for languishing projects, extensive coordination with line ministries and departments and promoting innovative project implementation through hybrid annuity model, he said. Jamie Langenbrunner Authentic Jersey
Government to spend Rs 7 lakh crore in developing highways
With the government constructing roads at a record 20 kilometers per day, Nitin Gadkari, Roads, Transport and Highway Minister on Monday said that about Rs 7 lakh crore would be spent to develop around 50,000 kilometres of national highways over the next five years. Replying to a query at the Rajya Sabha, Gadkari further added that the government has allocated a total gross budgetary support of Rs 46,834 crore including cess and toll remittance for 2016-17 for the ministry. In addition, internal and extra budgetary resources of Rs 59,279 crore have also been allowed to be raised for the highways department in 2016-17. For the Ministry of Shipping, the government has allocated a total gross budgetary suport of Rs 1,531 crore. In addition, internal and extra budgetary resources of Rs 3,183 crore has also been allowed. “There is a proposal to spend around Rs 7 lakh crores to develop National Highways of around 50,000 kilometres in the next five years. “For Sagarmala port development, the project cost is Rs 73,375 crore and in respect to port modernisation it is Rs 9,891 crore,” he added. The current pace is a third more than the previous best of 15 km per day achieved in 2012. “We’ll touch our target of 30 kilometres per day in another five-six months,” Gadkari had said earlier. According to him, the United States has promised technical help for the construction of roads, bridges and flyovers. The US will also share expertise in road safety and traffic management. Acknowledging that road safety is a big problem in India, Gadkari had earlier said that safe roads are of the highest priority for the government and that the US had assured full co-operation in meeting the challenge. During the current financial year, the government has set a target of constructing 10,000 kilometres of greenfield highways, for which a budgetary allocation of Rs 57,000 crore has been made. Eddie Goldman Jersey
State’s energy sector gets Rs162cr central sanction
Union minister of state (independent charge) for power, coal, new and renewable energy and mines, Piyush Goyal has confirmed that an amount of 162 crore has been sanctioned for the state of Goa under various schemes for improving and augmenting the energy needs of the state. Under the Integrated Power Development Scheme (IPDS), which will strengthen the sub-transmission network, metering, IT application, customer care services, reduce aggregate technical and commercial (AT&C) losses and establish an auditing system, projects worth 32.23 crore have been sanctioned. An amount of 110.73 crore was sanctioned in February 2009 for the implementation of the Restructured Accelerated Power Development and Reforms Programme (R-APDRP) project in the state. 31.47 crore has been disbursed till date, Goyal said. The R-APDRP aims to introduce information technology into all utility related functions of the department to bring relief to consumers who have to stand in long queues to get their bills paid. The programme that is being implemented by the REC Power Distribution Limited (RECPDL) along with their technology partner Tata Power Delhi Distribution Ltd (TPDDL), New Delhi, for the state is expected to bring greater transparency to the electricity department. Under the Deendayal Upadhyay Gram Jyoti Yojana (DDUGJY) scheme, which aims at electrifying rural India, projects worth 20 crore have been sanctioned for rural electrification works in the state. The information was provided to Goyal in response to a question from MP Shantaram Naik. Alexei Emelin Womens Jersey