India agrees to ink bilateral air service agreement with Fiji
As per a Financial Chronicle report by Nirbhay Kumar, India has agreed to sign a bilateral air service agreement (ASA) with Fiji, paving the way for direct flights between the two countries. According to a Ministry of Civil Aviation official, the two sides recently agreed to ink an agreement in this regard under which designated airlines from the two countries could operate thrice a week. “Besides cities like Delhi and Hyderabad, Varanasi has also been added as a point-of-call for Fijian Airlines in India. Indian carriers can operate to anywhere in Fiji,” the official said.
Airlines clock good growth; carried over 78 lakh people in March 2016
With the aviation sector continuing to see a spurt in traffic, many domestic airlines posted good growth as they ferried 78.72 lakh passengers in March with no-frills carrier IndiGo carrying most passengers during the same period. While the overall passenger growth stood at around 5.3 per cent, the market share of IndiGo jumped to 38.4 per cent in March, followed by Jet Airways at 17.6 per cent and Air India (14.7 per cent). Latest data from aviation regulator DGCA released today showed that local airlines carried 78.72 lakh passengers last month compared to 74.76 lakh in February. Over the past several months, more number of people have been travelling by air. In terms of Passenger Load Factor (PLF) — an indicator of filled seats — SpiceJet was on top with 91.1 per cent, followed by GoAir (86.3 per cent), IndiGo (85.1 per cent), AirAsia (82.7 per cent) and Air Costa (82.1 per cent). Among other airlines, the PLF of Jet Airways was at 79.1 per cent while that of JetLite and Air India stood at 77 per cent and 75.7 per cent respectively. According to the Directorate General of Civil Aviation (DGCA), PLF of airlines slightly decreased last month, primarily due to the end of tourist season. Except for IndiGo, GoAir and Trujet, rest of the carriers saw their market share either decline or remain flat in March. IndiGo’s market share rose to 38.4 per cent compared to 36.8 per cent in February while that of GoAir rose to 8.3 per cent from 8 per cent during the same period. Market share of Jet Airways fell to 17.6 per cent from 18.4 per cent. Air India saw its share drop to 14.7 per cent last month from 15.4 per cent seen in February. In the case of SpiceJet, the market share slipped to 12.8 per cent in March from 13.1 per cent in the previous month. Start-up carriers AirAsia and Vistara’s market share remained unchanged at 2.2 per cent and 2 per cent, respectively in March. “Passengers carried by domestic airlines during January-March 2016 were 230.03 lakh as against 185.46 lakh during the corresponding period of previous year thereby registering a growth of 24.03 per cent,” DGCA said. The figures are based on passengers carried by 11 airlines — Air India, Jet Airways, IndiGo, JetLite, SpiceJet, GoAir, Air Asia, Vistara, Air Costa, Air Pegasus, and Trujet. Meanwhile, the overall cancellation rate of scheduled domestic airlines stood at 1.29 per cent in March. “During March 2016, a total of 737 passenger-related complaints had been received by the scheduled domestic airlines. The number of complaints per 10,000 passengers carried for the month of March 2016 has been 0.9,” DGCA said.
Deal signed for development of occupational map in aviation
The Indian arm of global consultancy KPMG has collaborated with the Aerospace and Aviation Sector Skill Council (AASSC) to develop occupational map for the aerospace and aviation sector. The agreement, signed between KPMG India and AASSC, provides for design and development, manufacturing and assembly, airline operations, airport operations and MRO (maintenance, repair and overhauling), a statement by the consultancy said today. The occupational map will list the possible job roles along with the skill levels in each sub-sector, the statement said. Subsequently, KPMG will develop National Occupational Standards (NOS) for 70 job roles where there is high demand, it said. “This is a humungous task as there is a need to work with various industry players in the aerospace and aviation sector while drafting the NOS and getting their validation. After going through an elaborate process, the NOS for each job role shall be notified by the Central government,” the statement said. According to a study instituted by the Civil Aviation Ministry, the domestic aviation sector is projected to employ nearly four million people in two decades, driven by improved economic activities and labour productivity. “Our estimate indicates that by 2035, the Indian civil aviation sector (across the study segments of airport, airlines, cargo, MRO (Maintenance, Repair and Overhaul) and ground handling) will employ 0.8 to 1 million personnel directly and another 3 million indirectly (for 1 direct job about 3.5 indirect jobs are created),” the study said. While emphasising the need for having skill development programmes across various levels in the sector, the study suggested setting up of the National Civil Aviation Training Entity (NCATE). Formed under the government and industry led initiative of skilling Indian labour force, Aerospace and Aviation Sector Skill Council (AASSC) is the apex body in skill development.
Competition Appellate Tribunal sets aside CCI penalty on the airline: SpiceJet
SpiceJetBSE -1.20 % today said Competition Appellate Tribunal has set aside CCI’s order imposing a penalty against it in the case of alleged cartelisation in relation to cargo fuel surcharge. The tribunal, on April 18, set aside the Rs 258 crore fine on Jet Airways, IndiGo and SpiceJet and directed the regulator to pass a fresh order. In November, Competition Commission of India (CCI) had penalised the carriers for alleged cartelisation in fixing fuel surcharge on air cargo. SpiceJet was slapped with a fine of Rs 42.48 crore. In a filing to BSE, SpiceJet said the tribunal has set aside CCI’s impunged order and that the matter has been remanded back to the regulator. The tribunal has asked CCI to reconsider the joint Director General’s report and then take appropriate decision, the filing noted. CCI’s order last year came after its investigation arm Director General ( DG) conducted a detailed inquiry. “In the event the CCI disagrees with the findings and conclusions recorded by the JDG, then the CCI shall indicate the reasons for such disagreement and issue notice to the parties incorporating the reasons of disagreement and give them opportunity to file their replies/ objections and thereafter to pass appropriate order in accordance with law,” filing said quoting Compat order.
Looking to develop retail assets at Delhi airport land: GMR
GMR Infrastructure today said its subsidiary DIAL has shortlisted players for submitting financial bids in order to develop retail assets on nearly 23 acres of land at the Delhi airport. Delhi International Airport (Pvt) Ltd (DIAL), a joint venture where GMR group is the majority stakeholder, is operating the airport in the national capital. Other stakeholders are Airports Authority of India and Germany’s Fraport. In a regulatory filing, GMR Infrastructure said DIAL has initiated a two-stage international competitive bidding process for “development of retail assets on approximately 23 acres of land at the Delhi airport”. The Request for Qualification (RFQ), the first stage of the bidding process, was initiated on November 5, 2015. Applications from entities with relevant experience and financial capacity were sought. “The second stage of the bidding process was initiated on April 6, 2016, whereby the RFP documents have been shared with the shortlisted players inviting them to submit their financial proposals,” the filing said. Sources said as many as five leading realty players, including DLF, have been shortlisted for submitting the financial bids. The proposal is for developing retail complex of over two million sq feet at the land available with DIAL, they added. According to them, in the financial bids, the shortlisted players need to provide details about the upfront payment as well as the revenue sharing formula. Currently, GMR holds 64 per cent in the airport venture while Fraport has 10 per cent and the remaining 26 per cent shareholding is with AAI. The GMR-led consortium was awarded the concession to operate, manage and develop the Indira Gandhi International Airport here in January 2006. It inked the Operations, Management and Development Agreement (OMDA) in April, 2006. DIAL is a special purpose vehicle formed to carry out development, operation and management of the Delhi airport.
Civil Aviation Ministry suggests shifting from airport-based security to aircraft-based security at smaller airports
The civil aviation ministry has suggested a shift from airport-based security to aircraft-based security at smaller airports to minimise cost of flying on regional routes, an idea that has not found favour with experts. The suggestion, which marks the first time the government has thought of economising on security in aviation sector, is part of the new aviation policy that was sent for interministerial consultation earlier this month. “The sole intent is to keep the cost of flying low for regional flights, where we plan to fix fares at Rs 2,500 per hour, and is part of the policy,” said an aviation ministry official, requesting not to be named. The official said the plan is to make security aircraft-based or flight-based at the small airports. “Under the plan, the airport will be sanitised about two hours before the flight is to arrive and the security will move out of the airport about one hour after the flight departs. Otherwise, the airport will not be used and will have minimal security,” he said. This will help keep the cost low, he said. Analysts, however, slammed the idea on the grounds that aviation security cannot discriminate on the size of the aircraft or airport. “The risk of a hijack is the same for a big and small aircraft. Aviation security cannot be lax at airports that are small or have regional flights,” said Shakti Lumba, former head of operations at Air India and IndiGo. The ideas, if implemented, will lead to further problems, Lumba said. “What if the flight is delayed or an aircraft is grounded at an airport that does not have security. It simply cannot work like the way it has been suggested only because the government wants to keep the cost low,” he said. According to the National Civil Aviation Policy 2016, which is likely to be taken up by the Cabinet by the end of this month, the ministry intends to roll out regional flights at 30 airports which have the infrastructure in place. The government has decided to subsidise airlines for their cost of flying passengers beyond the fixed tariff of Rs 2,500 per hour. The policy proposes to charge Rs 8,000 per landing or take off on domestic flights by planes with 80 or more seats to fund the subsidy for regional flights. This levy will help generate an estimated Rs 500 crore annually. Apart from the subsidy, the government plans to offer concessions such as a flat 2% excise duty on fuel at regional airports for three years and 1.4% service tax on regional flights for one year. Excise duty on aviation fuel is 14% at present, while airlines have to pay a 5.6% service tax on tickets.
Zurich Airport sells 5% stake in Bengaluru airport to Fairfax for $48.9 mn
Zurich Airport has inked an agreement to sell its 5 per cent minority shareholding in Bengaluru International Airport Ltd (BIAL) to the Prem Watsa-backed Fairfax Holdings for $48.9 million. Subject to customary regulatory approvals, the deal is expected to be completed within the third quarter of 2016. While there has been no word on the agreement from Fairfax, Zurich Airport has announced it on its website. BIAL owns and operates Kempegowda International Airport Bengaluru (KIAB) under a 30-year concession agreement from the Indian Government, with an option for a further 30-year extension. KIAB, which began operations in 2008, is among the first greenfield airports in India built under a public-private partnership. It is now India’s third largest airport. Since the start of construction in 2005, Zurich Airport has transferred its operational expertise to BIAL through an Operations, Management & Services Agreement. With the conclusion of the maintenance contract in 2015, Zurich Airport’s role has been reduced to a minority shareholder, leading to the decision to monetise the remaining 5 per cent stake in BIAL. In 2009, Zurich Airport had sold 12 per cent of its shareholding in BIAL to GVK Power & Infrastructure Ltd. Ownership pattern The GVK Group, which had acquired a 29 per cent stake from L&T and Zurich Airport and 14 per cent from Siemens Project Ventures in the past, recently divested its 33 per cent stake in the airport to Fairfax Financial Holdings Ltd for ?2,149 crore, to pare its corporate debt. GVK’s stake is now 10 per cent, while Fairfax is the largest shareholder with a 38 per cent stake (including the Zurich Airport stake). Siemens has a 26 per cent stake, while the Airports Authority of India and the Karnataka government hold 13 per cent each.
Passenger movement up by 2.47 lakh
For the first time passenger movement at Coimbatore International Airport has crossed the 15 lakh mark. On reaching 17.31 lakh last financial year, the airport is all set to join the select airports in the country that are considered as major airports. Reason for increase is cited as the over all average increase in passenger movement across the country. Passenger movement that is steadily on the rise is expected to go up further when Air Carnival begins operations – possibly by the second half of May. Passenger movement at the airport has gone up by 2,47,261 in 2015-16. The departure and arrival last financial year is the highest the airport has recorded so far. It is 16.66 per cent more than the passenger movement recorded the previous year – the highest so far. This increase was despite a mere 1.18 per cent increase in the aircraft movement. Passenger movement has gone up in both domestic and international sectors.
Bekal to join the big league, air connectivity soon
The famous Bekal Fort of the Chirakkal Rajas, one of the largest and best preserved forts in the State, is all set to figure on the aviation map with plans afoot for the construction of an airstrip. The airstrip that can accommodate 50-seater aircraft will offer last-mile connectivity to the Bekal Special Tourism Area that has already been developed as an exotic beach destination. The Cochin International Airport Limited (CIAL) has almost finalised a Detailed Project Report (DPR) for the construction of the airstrip. Incidentally, the authorities are yet to convene a meeting of stakeholders and the Bekal Resorts Development Corporation (BRDC) spearheading the destination development in Kasaragod district, thanks to the code of conduct in force ahead of the May 16 Assembly election. Sources said the government had already granted administrative sanction and had allocated Rs.35 crore for the first phase of the project proposed in Uduma panchayat. As much as 120 acres will be required for the airstrip, which will come up close to the notified area, while 40 acres are already in the possession of the government and the BRDC. For the record, it takes two hours by road from Bekal to the Mangaluru airport and the upcoming Kannur international airport. The airstrip will come in handy for the six resorts that have come up at Bekal to attract upmarket holidayers. Airlines can directly operate to Bekal or can offer air connectivity from international airports in the State.
Air India chairman joins rodent watch
After the frequent grounding of its aircraft due to rodents, Air India chairman Ashwani Lohani carried out an inspection at Delhi airport and directed the staff to ensure strict maintenance and cleanliness of the hi-lift trucks used by catering companies. Also, staff of the government-owned airline will be restrained from eating meals in the ramp area (where the aircraft is parked during boarding). “We have also requested Delhi International Airport Ltd to provide space for a staff canteen,” said Lohani. On Saturday, an AI Boeing 787 on the Melbourne-Delhi flight was diverted to Singapore, after a rat was spotted on board. The plane was fumigated in Singapore and passengers flown to India on another flight. This was the third instance of grounding of an AI aircraft due to rodents. Rats were also spotted on an aircraft between Birmingham and Delhi, and while passengers were boarding a Frankfurt-bound flight at Delhi. Airline staff are advised to take immediate action to clean and fumigate the aircraft on sighting of a rodent.This is done for safety reasons, as rats can mess with cables and wiring inside the aircraft. Staff also keep rat traps (called glue traps) in the aircraft cargo hold whenever a rat is spotted. Till a few years earlier, AI used to fumigate aircraft with methyl bromide if a rat was seen but its use has been discontinued, as it is highly toxic.