Government tells NITI Aayog to draw a road map for ailing Air India
Amid the dilemma over spending Rs 50,000 crore on health, education or airline, the government has tasked NITI Aayog to devise a road map for ailing Air India, which may include recommendation for a strategic sale. The latest push to set the house in order in the beleaguered state carrier has been spearheaded from the top. Sources said the NITI Aayog is looking at various options and will submit its recommendations in the next few weeks after which the government will take a final call on the way forward. This is the most serious effort being launched by the Modi government to tackle the mess in Air India. The then Vajpayee government had jump-started efforts to sell a stake in Air India and the then disinvestment minister Arun Shourie had promised to push ahead with a strategic sale even if one bidder was in the fray . But ultimately, the plans fell through and Air India continued as a state-run entity . “Why should we continue to put thousands of crores in Air India when we can utilise the money for several social sector projects,“ said an official, who did not wish to be identified. Estimates suggested that the airline has liabilities of over Rs 52,000 crore, with the interest burden alone esti mated at Rs 4,000 crore annually. While Rs 25,000 crore has been pumped in over the last five years,a similar amount has been committed till 2032 but still Air India will have an annual cash deficit of Rs 3,000 crore. Alarge part of the blame is on the way the national carrier was operated during 200507 when an aircraft acquisition plan of Rs 50,000 crore was cleared for an airline with a turnover of around Rs 15,000 crore, putting the national carrier under a severe debt burden, which it is finding tough to service. Officials have also blamed the Air India-Indian Airlines merger for the current mess. But the government is now finding it tough to sustain the ailing airline given its commitment to fiscal consolidation and the focus having shifted to welfare, for which it needs to spend more on health and education. Air India has loans of Rs 48,400 crore -working capital and term loans of Rs 22,000 crore, aircraft-related debt of Rs 19,000 crore, and Rs 7,400 crore that it had raised via non-convertible debentures (NCDs). Air India has been trying to get lenders to cut the interest rate on loans of Rs 10,500 crore, on which it pays 10.1%.The debt servicing alone comes to about Rs 4,000 crore per annum for the airline. John Elway Womens Jersey
Maha CM lauds Praful Patel’s contribution to aviation sector
Maharashtra Chief Minister Devendra Fadnavis today recognised contribution of senior NCP leader and former Union minister Praful Patel for the face-lift of the aviation sector in the country. “The changed face of the country’s aviation sector is pushed by Praful Patel and people are thankful to him,” Fadnavis said after the launch of Patel’s photo-biography. Patel, a Rajya Sabha member, is a former Civil Aviation Minister. Shiv Sena president Uddhav Thackeray, megastar Amitabh Bachchan and Reliance Industries chief Mukesh Ambani also attended the function. “There was a time when landing at any Indian airport from an international flight was enough to notice that you have arrived in India. The odour and looks of the airport were disappointing. “Now, things have changed for better and world class airports that can handle millions of passengers are well managed by our companies. The decision of privatisation of airport development and management turned crucial and all are thankful to Patel,” said the Chief Minister. Praful Patel has achieved several things but his closeness to people is still intact and it is commendable, added Fadnavis. Uddhav said he and Patel represent different political parties but that did not affect their friendship. Charles Harris Womens Jersey
UP govt revives Jewar airport project, survey to start today
With the change in regime, the Uttar Pradesh (UP) government has started the process to revive the international airport project in Jewar. The Obstacle Limitation Surface (OLS) survey for the proposed airport will begin on Monday. Talking to DNA, Yamuna Expressway Industrial Development Authority (YEIDA) Chairman Prabhat Kumar said the proposal will soon be sent for clearance to the steering committee formed by the Union Ministry of Civil Aviation. According to officials, an OLS survey is mandatory before starting work on an international airport. They further said the survey is conducted to determine corners and midpoints of runway strips. “An Inclinometer (slope indicator) is required to calculate slope, which is determined according to the regulations applicable in a particular country. An OLS survey mobile app will be used to record observations, including photos, for each location. An electronically recorded survey report will then be automatically sent via email. The app is being used as part of an aviation safety management master emergency plan. The app can be tailored to include action plans for regional planning and zoning regulations as well,” an official said. San Francisco Giants Jersey
With A Flight In 65 Seconds, Mumbai World’s Busiest Single-Runway Airport
The GVK group-run Mumbai airport has become the world’s busiest amongst the single-runway facilities by handling 837 flights a day or one in 65 seconds on an average in fiscal 2017, overtaking London’s Gatwick airport that had 757 flights a day. In terms of the number of passengers also, the city airport tops with 45.2 million people flying in and out in fiscal 2017 as against 44 million at Gatwick airport. Notably, no other large city in the world is served by one airport, that too with a single-runway. Besides, illegal squatters occupy nearly one-third of the airport land. The second airport proposed in Navi Mumbai is yet to come up. All the leading cities like New York, London, Dubai, and Singapore have more than one airports with multiple runways. The New Delhi airport has three parallel runways in use at any given time. As against this, Mumbai has to make do with a single runway (09/27) for all passenger and cargo aircraft and when it is shut for repairs, it uses the secondary runway (1432). In terms of aircraft movement in a day, the city airport had one plane take-off or landing in 65 seconds, which means it handled on an average 48 flights, peaking at even 52 movements at times, making it the busiest in the world on both the counts, an airport spokesperson said. The ATC (air traffic controller) thus has to manage two arrivals every 130 seconds and one departure in between these two arrivals. So there is one take-off or touch-down every 65 seconds from the main runway. That means the land-starved airport handled a whopping 837 flight movements a day, which on an average is 80 flights more than Gatwick handling 757 movements in a day, the spokesperson said. There are days when the number crosses even 900 movements a day, she said. However, the Delhi airport handles much larger number of passengers. At 45.2 million, Mumbai handled only 18.6 per cent of the total air traffic in the country while the Delhi airport handled 57.7 million passengers or 21.6 per cent of the total air traffic in the country in fiscal 2017. Out of the 45.2 million passengers at the Mumbai airport, 12.4 million were international travellers. John Gibson Womens Jersey
Draft of revised rules for UDAN likely in two weeks
The government is likely to complete in the next two weeks framing of the draft of revised rules for its scheme to promote low cost air travel and put up for stakeholder consultations, as it prepares for the second round of bidding by airlines. The Ministry of Civil Aviation undertook a comprehensive review of the rules, including those relating to the number of discounted seats in a plane and exclusive flying rights for carriers on select routes, under its regional connectivity scheme (RCS). “In another two weeks we will be putting out the RCS (rules) with amendments for public consultations,” Ministry of Civil Aviation Secretary R N Choubey told PTI. Without elaborating on the specifics, the top official said the revision is being done with an emphasis on increasing competition. “Our intention is to decrease entry barriers and increase competition. We would like to bring as many players as possible. We want to create a level-playing field so that small players can bid aggressively,” Choubey added. In the first round of bidding, which concluded in March, five airline operators were awarded 128 routes. The regional connectivity scheme became operational last month with the first flight under it being inaugurated on the Shimla-Delhi route. Josh Reynolds Jersey
Mumbai airport gets green nod for Rs 3,500 crore expansion plan
The Mumbai airport has received environmental clearance for a Rs 3,500-crore expansion plan as well as shifting of the iconic air traffic control tower to Kalina as a long-term security strategy. The changes are set to take place over the next three years as the Chhatrapati Shivaji International Airport (CSIA) expands to accommodate 50 million passengers by 2020. Interestingly, chief minister Devendra Fadnavis had said the first flight from the proposed Navi Mumbai airport will take off by 2019. Arguing its case before the Union environment ministry, MIAL, the consortium that operates the airport, said: “This is important as CSIA shall be required to serve the entire demand of Mumbai till the commencement of operations at the proposed Navi Mumbai International Airport.” On the drawing board for CSIA is a new vehicle underpass below the secondary runway that will ferry passengers between the two terminals in less than 15 minutes. At present, traversing the 4km between the terminals takes up to 30 minutes. MIAL’s ambitious expansion project, which got the nod of the Expert Appraisal Committee of the Union ministry of environment and forests and climate change last month, will require around 20 acres of the 308 acres of encroached airport land. This includes six acres for a taxiway from the parking apron of Terminal T2 to the main runway and 9.04 acres for another taxiway expansion to enhance airside safety and efficiency, said an MIAL spokesperson. The balance 4.9 acres will be for facilities like radar, aircraft parking, aerobridge, etc. Though MIAL has obtained permission to shift the awardwinning Air Traffic Control Tower (ATCT), the spokesperson said there were no immediate plans to relocate it. It was constructed around four years ago at acost of Rs 125 crore. “The current ATCT location is highly accessible from all sides. In view of threat perceptions of security agencies, MIAL is considering shifting the ATCT to a more secure location in the southern part of the airport as a long-term strategy. This project will be taken up for implementation only if advised by the security agencies after careful consideration of all aspects,” said a senior MIAL official. Another construction planed to enable more flights to take off is a bridge to connect the air craft parking apron of Terminal T2 to the taxiway leading to the main runway, creating additional holding area for aircraft ready for takeoff. The Mumbai Metropolitan Region Development Authority (MMRDA), which is the planning authority for the airport area, has identified slums in 11 priority areas that need to be shifted. The survey has been underway for one year despite severe opposition from local residents and political parties. The spokesperson said car go expansion work is already on. “It has been increased to 7.8 lakh metric tonnes and will be further expanded to one million metric tonnes. The expansion of the passenger terminals will require the relocation of slum dwellers. This will be done in accordance with the slum rehabilitation policy of the Maharashtra government for CSIA.” Residents of the surveyed slums will be relocated on the Premier Auto land at Kurla where around17,000 tenements have been constructed by HDIL in lieu of transfer of development rights to the tune of Rs 2,000 crore. MIAL refused to disclose how it proposes to develop the balance 288 acres of slum encroached land. CM Fadnavis has announced in situ rehabilitation while the previous Congress-led government had sanctioned a global floor space index of 1 for the entire airport land. The interim development plan approved for the airport notified area allows the non-aeronautical area to be used for hospitality, leisure, tourism and business activities. Riley Dixon Authentic Jersey
How UDAN scheme has changed IndiGo’s flight plan
IndiGo, it seemed, was convinced that a single-breed aircraft fleet works best for a low-cost airline. But, now, in a complete change of tack, the carrier has announced that it will acquire ATR 42-600 aircraft to fly on regional routes. The airline has signed a term-sheet with ATR for these aircraft. IndiGo’s change in plans can be viewed in various ways. First, it can be seen as a logical step to grow in Tier 2 and 3 cities, for which, the airline’s existing fleet of Airbus A-320 will not work. With many believing that the next phase of growth in the domestic aviation market will come from tier 2 and 3 cities, and the fact that the number of passengers flown under the Government’s UDAN scheme will count towards domestic market share, it probably makes sense for IndiGo to venture into this market. Many also believe that the announcement follows a nudge from the Government that the market leader needs to be part of its new aviation initiative. Anyway, there is history of other airlines opting for smaller aircraft. SpiceJet ordered Q400 in 2010 almost five years after Ajay Singh restarted the airline. Jet Airways picked ATR aircraft years after starting and stabilising its operations in the domestic market. Guarding dominance Many believe that as the market leader, with a share of over 40 per cent, IndiGo may be looking at ATRs as a natural way to ensure that its competitors — SpiceJet and Air India, which have already secured routes under UDAN — do not become a threat to its dominance. Incidentally, this is not the first time IndiGo has announced its intention of entering the regional market. During the UPA government’s second term, IndiGo officials had told media, off the record, that it was signing up for smaller aircraft to look at regional routes. The then Civil Aviation Minister, Ajit Singh, had been keen on regional connectivity. But with the Manmohan Singh government losing the elections that plan died a natural death. This time, the regional connectivity scheme is already up in the air. Focus division And, IndiGo is serious about that. Addressing a conference call after announcing the ATR move, Aditya Ghosh, IndiGo President, said a ‘focus division’ will handle the turbo-prop operating functions that will not overlap with its narrow-body working. These operating functions will comprise flight operations, inflight services, despatch and operations control, route planning and revenue management. But human resource, finance and legal functions will be managed by the IndiGo infrastructure already in place. “The advantage of this overall structure is that it will avoid adding complexities to IndiGo’s mainline operations. At the same time, most if not all administrative functions will be handled by the existing IndiGo department,” Ghosh said. ATRs will also face other hurdles. The first is lack of a trained manpower, especially pilots to operate the ATR 42-600 aircraft. If IndiGo is forced to bring in expat pilots, it could be looking at a monthly salary packageof $10,000 (?645,000) per commander. The actual payout is likely to be higher, as the airline will have to bear the taxes on pilots’ salaries. While IndiGo has not indicated how many ATRs it is planning to get, the rules stipulate that there should be a minimum of three sets of crew per aircraft, which means that the airline will need at least six pilots per aircraft. Besides, the pilots operating the smaller aircraft will naturally want career progression by moving to operating the larger Airbus A-320 aircraft of the airline. This is something which has played out in several Indian carriers already, including in Air India. At the moment, IndiGo does not face this problem as it operates an all Airbus A-320 fleet. Jason McCourty Jersey
‘It is difficult to harmonise airline services’
As Star Alliance, a club of 28 global airlines including Air India, celebrates its 20th anniversary, its Chief Executive Officer, Jeffrey Goh, met global media to outline the Alliance’s plans. Excerpts A lot of customer service issues have been raised by various airlines with United being the big one? Has there been any discussion at the Alliance on common standards of customer service? We should recognise that certain operational matters remain the prerogative of our members. In terms of cooperation, Star Alliance is not all-encompassing. On the issue of more standardised service, it is not easy to achieve because our members are of different size, cultural backgrounds and have different business models… it is very difficult to try and harmonise service standards. In the case of United, there has been a lot of interaction within the Alliance…The resulting new policy for this airline (United) is certainly one of communication and exchange with other members. The discussion was not across the Alliance but among members. In a large country like India, is one airline enough for the Alliance, or will you look at another partner? India and Brazil are big and fast growing markets. We are constantly assessing to see whether one, two or even a third member will meet our purposes. Will that be a low-cost carrier or a full-service airline? The Connecting Partner Model gives us the option of working either with a full-service carrier or with, I will not call it a low-cost carrier, a hybrid carrier, on a more local or regional basis. (Launched in December 2015, the Connecting Partner Model allows low-cost and hybrid airlines to connect to the Alliance network.) In its 20th year, will you look at advocacy as the Alliance has not really spoken up on issues concerning the industry? If it is an industry issue, we think the better people to advocate it will be the International Air Transport Association or the International Civil Aviation Organisation. But almost three-fourth of the passengers flown globally are on your partner airlines… It will depend on the issues. Which are the issues? Our voice may add, but it is not going to change, for instance, the electronic devices ban. We have a view on this and we will share it with IATA and ICAO. What is your view? Our members are concerned. Obviously this impacts operations and customer experience. If this has a negative customer experience, then we should be careful. But it is a positive for a number of your airlines (the laptop ban has seen passenger carriage increase on Air India)… If you look at the latest coming out of Washington, they are also thinking of extending the ban to Europe. We have a member from the US as do the other alliances and they operate to many stations in Europe. If this ban happens, it is going to affect them just as much as other airlines. In its 20th year, is Star Alliance now targeting 20-year-olds by shifting the focus to a digital experience? We have to adapt. If we continuously focus on high-value travellers… then we are missing an important segment of the market. Travis Frederick Womens Jersey
Let the scripting of Air India’s future begin with professionalising it
Even half-hearted suggestions of a stake sale (read: privatisation) in Air India (AI) have invariably been followed by virulent protests. This has compelled the government to repeatedly deny the existence of any such plan. As a result, AI continues to be in a turnaround mode for over two decadeswith every incumbent aviation minister and AI chairman and managing director periodically making claims of having achieved success, even if discernible signs of a meaningful turnaround have been non-existent. Rusney Castillo Womens Jersey
Run ragged by rivals, Air India has just two choices left: Privatise or perish
Two months after the Narendra Modi government took charge in May 2014, the Prime Minister’s Office (PMO) called a meeting to discuss the possibility of Air India advancing its revival by two years and subsequently going in for a stake sale. “During the meeting, pointed questions were raised on advancing Air India’s profitability target to FY19 from FY21and a plan to divest stakes in the national carrier after it turns around,” said a senior Air India official, who did not want to be identified. Kamalei Correa Authentic Jersey