New Civil Aviation Policy to address issues of e-visas, regional connectivity
The new civil aviation policy of the union government, which is quite on the cards, will address both the issues of opening up the skies and regional connectivity in a very aggressive and fulfilling manner, a top Tourism Ministry official said at an ASSOCHAM event held in New Delhi. “The new tourism policy, which is just a matter of time, is going to highlight and emphasise a lot on the possibility of increasing Meetings, Incentives, Conferences, and Events (MICE) into India,” said Vinod Zutshi, secretary, Ministry of Tourism while inaugurating a “Thought Leadership Meet on MICE Tourism in India,” organised by ASSOCHAM. Talking about the e-visa for MICE, Zutshi, “We had a meeting with the Ministry of Home Affairs a few days ago, we insisted on MICE e-visa as well, we have been trying very hard for e-visa for MICE and medical and we are hopeful to have this e-visa to see the light of the day, particularly for business tourists to begin with but we are insisting that ultimately the conference visa should also be done, which we have been assured that it will be, step-by-step.”
20 years of growth: Why India’s aviation industry is taking off
“Indians want to spend money. They’re one of the world’s biggest spenders today.” That’s the explanation Neerja Bhatia, vice president of India Etihad, offers for why India is now the world’s fastest-growing aviation sector. “If you look at the past, an average middle-class family would take one domestic holiday a year,” she tells CNN. “Today the trend has changed.” International carriers want in on the action. In 2013, India’s Jet Airways partnered with the UAE’s Etihad Airways. With Jet having the widest domestic network in India, there were suddenly dozens more routes, and tens of thousands of seats, connecting India to the Abu Dhabi hub. Together, the partnership holds 21% of India’s aviation market, meaning about one in five fliers in India board either Jet or Etihad. India’s airspace hasn’t always been so lively or attractive. The government had a monopoly on national air carriers and strict aviation policies blocked foreign ventures. That all changed with de-regulation in 1994. Air India, the country’s national carrier, has been carrying the India flag around the world for decades.
Supreme Court threatens DGCA with audit of its licensing policies
he Supreme Court on Tuesday asked whether lucrative sectors were being handed out as “largesse” to private airlines to the detriment of state-run Air India. It threatened an audit of licensing policies to find out why the national carrier was making losses unless the government ensured that private airlines flew on routes that weren’t lucrative as mandated under the rules. The court was hearing a petition seeking a Delhi-Shimla flight, which the aviation ministry has been resisting on the grounds that the airfield was small and that Air India didn’t have planes of the right size. The bench comprising chief justice TS Thakur and justice R Banumathi threatened the Directorate General of Civil Aviation (DGCA) with an audit by former comptroller and auditor general Vinod Rai. Under route dispersal guidelines, all private airlines have to connect not-so-profitable routes as well. But most leave the task to the national carrier, causing it huge losses, the court had observed earlier. Appearing for DGCA, additional solicitor general PS Patwalia initially sought more time from the court to allow the regulator to revisit route dispersal guidelines to deal with lack of connectivity to areas such as Shimla. However, he later urged the court not to direct an audit by Rai. DGCA had no “skeletons” in its cupboard and nothing would come of such an inquiry, he said, seeking another opportunity to address Shimla’s lack of connectivity. Thakur was reluctant to grant him time, but deferred passing any order directing Rai to audit DGCA guidelines till April 22. “You are just promising to revisit the guidelines. You have not done anything,” he observed. “These airlines are not bothering on the not-so-lucrative routes. You are not insisting on it. You are giving the lucrative routes without insisting that they carry out their concomitant obligations to cover the not-so-lucrative sectors.” Thakur’s statements on the matter were forthright. “You need someone to call your bluff. This is a bluff. We need someone who will call your bluff. People are suffering because you are looking after operators’ economic interests and not the people’s interests,” he said. “Is it not the obligation of your policy to take care of the interests of Shimla? You have not done it.” Patwalia’s defence that many poorly connected destinations had been covered by air services didn’t appear to satisfy the bench. “We want results,” Thakur said. “We don’t want dilly-dallying tactics. There are a lot of skeletons in your cupboard. Let them all come out. It is time to open the process up to scrutiny.” The law officer denied this, saying the guidelines were transparent and being implemented strictly. Air India has been insisting that it will fly the route if the state government subsidised its losses, whereas private airlines have refused to do so.
Kingfisher Airlines fund trail: CBI plans to send letters rogatory to 4 countries
The Central Bureau of Investigation (CBI) has received information from the Financial Intelligence Unit (FIU) on Vijay Mallya investments abroad and now plans to send letters rogatory (a judicial request) to four countries including France, US, Switzerland and the UK to probe former Kingfisher Airlines fund trail. The central agency is probing allegations that Mallya diverted funds taken as loan from government banks to the now defunct Kingfisher Airlines. ET has first reported that CBI will send LRs to different countries on March 11. The Letters Rogatory (LR) is required to gather information which will be admissible as evidence in court. Mallya reportedly has several properties in US, UK, France and Hong Kong. He is reportedly living in London. A non-bailable warrant (NBW) may be issued against Mallya as he has failed to appear before the Enforcement Directorate in connection with the loan default case. The former liquor baron owes nearly Rs 7,000 crore to a group of 17 banks. The ED may either move a competent court in Mumbai to get a NBW issued against him or approach Ministry of External Affairs to revoke his passport. Mallya, on March 30, had submitted to the Supreme Court a repayment plan of Rs 4,000 crore by September this year. But the consortium led by the State Bank of India has rejected his proposal.
Passenger growth, lower fuel prices to boost revenues of airlines
Earnings of Indian carriers are likely to be high in the the March quarter, too, as jet fuel prices are down over 23 per cent from last year. Strong passenger growth will help domestic airlines improve their top line and margins in the March-end quarter, analysts say. With traffic growing well over 20 per cent and load factors elevated at 85 per cent, airlines are likely to fare well in what is known to be a seasonally weak quarter. Aviation turbine fuel price is 23.7 per cent lower at around Rs 37,900 per kilolitre in January-March 2016 on a year-on-year basis and this could boost airline margins. According to an analyst poll by Bloomberg, SpiceJet is estimated to show 70 per cent revenue growth on a year-on-year basis while Jet Airways’ revenue, excluding other operating income, is expected to rise 15.5 per cent. IndiGo had earlier indicated its revenue would rise six-eight per cent on a year-on-year basis, but analysts expect it to do better than that on strong demand. Bloomberg has not shared a comparative year-on-year figure for IndiGo. On the flip side, however, a six per cent depreciation in the rupee and pressure on yields due to softening of fares will impact profitability of carriers. While Jet Airways and SpiceJet are expected to post growth in profitability, IndiGo has warned that its profit will be impacted by the rupee depreciation.
5-year rule for airlines to fly abroad may go
The rules for local airlines to fly overseas, a highly contested policy issue within the industry, are set to change with the government ready to abolish one of the current eligibility conditions while keeping the other. The condition of flying on domestic routes for five years for an overseas permit doesn’t feature in a note circulated by the civil aviation ministry for inter-ministerial consultations on Friday. But it keeps the requirement of a minimum fleet of 20 aircraft. There is an addition as well: every airline will have to maintain 20% of the total capacity in the domestic sector all the time. This is likely to be the final policy because ministers have already met and informally approved it. “We have the consent of all these ministers and ministries and the cabinet approval should come by the end of this month,” said a senior aviation ministry official, who did not want to be named.
Cochin International Airport posts 20% growth in passenger traffic
Cochin International Airport Ltd has posted a 20 per cent growth in passenger traffic, thereby handling 77 lakh travellers in FY-16. Of this, the growth in domestic passengers was 16.66 per cent, while the international passengers constitute 23.92 per cent. The number of domestic passengers was 31.29 lakh against 26.82 lakh in the previous fiscal while the figure of international travellers was 46.41 lakh against 37.45 lakh. The aircraft movement during the period also registered a 10 per cent growth. As many as 24 airlines are currently operating from CIAL and more companies have evinced interest in staring operations shortly both domestic and overseas services. This included Vistara, Air Pegasus and Thai Air Asia’s Kochi-Bangkok service. V.J. Kurian, Managing Director, attributed the surge in traffic to the economic model that CIAL had been following. “We always practice cost effective way of functioning. This is one of the airports in the country charging the lowest fares for services offered”. The notable feature in the past fiscal was the significant increase in the domestic passengers. There had been a good increase in the tourists from North India as well as passengers from Far East countries. With the commencement of operation of new international terminal, the flight services as well as number of passengers would clock an even greater surge, he said.
Plea in Bombay High Court for CBI probe into KFA’s jet fuel procurement
The Bombay high court on Monday received a petition to hear a fresh plea for CBI action against Vijay Mallya and his defunct Kingfisher Airlines over Rs 602-crore aviation fuel, which he received on credit from a public sector company between 2008 and 2010. The petition has alleged that Hindustan Petroleum Corporation (HPCL) started extending credit for the sale of aviation fuel to Kingfisher Airlines in 2008, and continued to do so despite his unpaid fuel bill of Rs 602 crore. After social activist Pratap Teli first approached the HC in 2013, the CBI had in February 2014 assured the court that it had registered a criminal case against Kingfisher and would complete its “inquiry” within three to four months. The HC bench of Justices Naresh Patil and V L Achliya had disposed of the petition then after recording the statement made by CBI counsel Rajesh Desai, but kept all issues open on merits of the case. Over two years later, Teli’s counsel Aditya Pratap on Monday informed a bench of Justices Naresh Patil and A M Badar that the CBI appears to have done nothing as its probe has not progressed at all. He said, “Representations made even last December to the CBI to find out the status of the probe have gone unanswered, and the HC ought to hear the matter afresh and direct it to complete it.” The bench directed that the matter be placed for hearing after two weeks. Teli’s petition says that in 2013 he got information of how a public servant was committing an offence of criminal breach of trust under the Indian Penal Code and criminal misconduct under the Prevention of Corruption Act over the huge fuel credit to Kingfisher Airlines. Concerned at the huge outstanding amount, the ministry of petroleum had written in March 2010 that “further supplies to KFA be made against bank guarantee to cover entire outstanding dues including for the credit period allowed by HPCL”. The ministry even sent a reminder in May 2010 expressing its “concern” over the “continued outstanding of HPCL towards Kingfisher Airlines on account of ATF supplies. Almost one-and-a-half months have elapsed, HPCL has not furnished action taken report.” When Teli first gave the information to the CBI, he said the premier agency merely sat on it till he moved the HC when the CBI said it registered an FIR. But despite the February 2014 HC order, the CBI has not investigated, nor filed any chargesheet or even a closure report, his petition said. “This inaction has emboldened Mallya to leave the country” and the petitioner to move the court. The petition in the court now says, “A detailed investigation is required to unravel the real truth about how HPCL kept on giving credit in violation of public policy.”
Navi Mumbai airport: Maharashtra gives nod for issuing request for proposal
Maharashtra cabinet today gave its assent for the City Industrial Development Corporation (CIDCO) to issue a Request for Proposal for the proposed Navi Mumbai International airport. Replying to a debate on Mumbai and Konkan in the Assembly, Chief Minister Devendra Fadnavis gave this information and said four consortiums had been short-listed but one was disqualified as it did not get a security clearance. Fadnavis said the first phase, which will handle one crore passengers, will be commissioned by 2019. “The Rs 16,000 crore project is being implemented through Public-Private Participation and CIDCO has a 26 per cent stake in it. CIDCO already has 80 per cent of the land in its possession. Nearly 95 per cent of the land has been acquired through consent,” he said. Provision of Rs 40 crore will be made for development of Ambavade village, the native place of Dr B R Ambedkar, on the occasion of his 125th birth anniversary, the Chief Minister said.
Pul’s sends proposal to centre on tourism and civil aviation
Chief Minister Kalikho Pul called on Minister of State for Culture, Tourism and Civil Aviation Dr Mahesh Sharma on Thursday to discuss on ways to develop tourism in the state. Unveiling his plan, the CM proposed to develop the circuit from the entry points along Assam-Arunachal border upto the tourist destination. CM informed that state government is making efforts to make easily available inner-line permits (ILP) and the restricted area permit (RAP). For that to achieve, he informed that entry check gate at the state’s border will have provision to issue the permits “on-arrival”. Pul further informed that proposed tourist circuits would provide wayside amenities at every 50-60 km points with all facilities to assist the travellers. The CM requested to expedite the process of connecting and improving helicopter services for all the district headquarters. Pul requested the minister for one-time waiver of all pending dues for helicopter service in Arunachal, to which the minister agreed to consider it.