7 NE airports have potential for operations under UDAN: Report
About 44 airports across the country including seven in Northeastern States have “high potential” for operations under the ambitious Regional Connectivity Scheme (RCS) for civil aviation, UDAN, according to a report brought out by apex industry body FICCI. “Based on the geographical, operational and commercial parameters, 44 out of the 414 underserved and unserved airports have high potential under RCS. “We have also identified around 370 potential destinations for the shortlisted airports, including metros, State capitals and important commercial, industrial and tourism centres,” said the FICCI report, brought out in concert with global professional service company KPMG. Assam has three high potential RCS destinations and two each in Arunachal Pradesh and Meghalaya. Uttar Pradesh has four high potential RCS destinations, three each in Maharashtra, Rajasthan, West Bengal, Bihar, Karnataka, Himachal Pradesh, Gujarat, Chhattisgarh and one each in Andhra Pradesh, Telangana, Tamil Nadu, Odisha, J&K, Puducherry, Lakshadweep, Daman and Diu, Haryana, Madhya Pradesh, Jharkhand and Uttarakhand. “So far 22 States have joined the RCS and we have identified 30 airports where operations could be started immediately,” Union Civil Aviation Secretary Rajiv Nayan Choubey said. RCS, or UDAN (Ude Desh Ka Aam Naagrik), was introduced as part of the National Civil Aviation Policy 2016 and was formally launched in October last. It provides an opportunity to take flying to the masses by way of fiscal incentives, infrastructure support and monetary subsidies (viability gap funding). Noting that RCS was a good scheme, Regional Director of International Civil Aviation Organisation Arun Mishra, however, said India did not have the wherewithal right now for RCS to become successful. “They are trying to build the wherewithal but it will take some time,” he said. “We have to be careful about creating the enabling conditions for this scheme to become successful. One of the most important things is the right size of aircraft that you need.” He said a plan was required to induct smaller aircraft for RCS operations. Seattle Seahawks Jersey
Indian Airlines Soar But Experts Warn of Turbulence Ahead
A major acquisition by Indian budget airline SpiceJet this week underscored the vast potential of the world’s fastest-growing aviation market, but experts say woefully inadequate infrastructure and high operating costs could threaten the industry’s rapid expansion. India’s burgeoning middle classes are taking to the skies in ever greater numbers, with passenger growth of 20 percent in 2015 according to industry body IATA — nearly double China’s 11-percent increase over the same period. Low-cost airlines are rushing to expand their fleets to take advantage of that growth, encouraged by a fall in fuel prices that last year pushed several private operators into profit for the first time. SpiceJet, India’s fourth biggest airline with a 13-percent market share, said Friday it was buying up to 205 Boeing planes worth $22 billion to fuel a major expansion of its domestic operations. Experts say the country’s aviation sector holds vast untapped potential, with just 100 million of India’s 1.2 billion people taking to the skies last year. But they warn that India’s rickety infrastructure could hold back future growth, with just 90 of the country’s more than 460 airports currently operational. “Consistent 20-percent-plus growth per se is not a cause for celebration if the institutional framework is weak,” said Kapil Kaul, South Asia head of industry advisory and research firm CAPA. “This only increases safety and security risks. And skill shortages are also emerging. An urgent fix is required.” CAPA has warned that India could face a capacity crisis unless it builds 50 new airports over the next decade. Andreas Athanasiou Authentic Jersey
Will the Government spend $10 Billion on Airport Infrastructure?
According to Civil Aviation Secretary RN Choubey, if about $10 Billion is spent on airport infrastructure in the five years then India will become the world’s third largest in the aviation market in next seven years. There are around 400 unused lands across the country, which have become useful for the cattles for grazing. These lands could be used by the aviation industry to make airports. The growth rate is expected to escalate in the coming years after the airport infrastructure is determined. The growth of about 23% is what India is aiming at in comparison to China. China—India’s rival in terms of aviation—shows a growth of about 41%. The Indian aviation growth is enhanced by proactive industry-friendly policies but also by the fall in the fuel prices. The progressive policies and the Regional Air Connectivity Scheme at the national level have helped in boosting the airport infrastructure and developing more flights for the masses. The fares in the civil aviation have been made almost as same as that of an air-conditioned train fares. As per the Regional Air Connectivity Scheme, about 50–60% viability gap funds were refunded as subsidy. Jerry Hughes Authentic Jersey
Watsa’s Bangalore International Airport investment plan gets government nod
The government has given the long-awaited security clearance to billionaire Prem Watsa’s proposed investment in the GVK-led Bangalore International Airport (BIAL). A GVK spokesman confirmed the development and said this will pave the way for the deal “to be concluded very soon”. Sources said the security clearance had been recommended by the Ministry of Home Affairs several months earlier. The Ministry of Civil Aviation however had kept some approvals pending and sought several clarifications from both parties as well as from the Karnataka state government. Indian-born Watsa’s Toronto-based Fairfax Group had in March last year, announced its decision to buy a 33% stake in BIAL from GVK Group for Rs 2,149 crore, valuing the eight-year-old airport at about Rs 6,500 crore. A month later, Fairfax signed another deal to buy 5% stake held by Flughafen Zurich AG in BIAL. GVK had said the sale was one of its fund-raising steps to reduce debt. The conglomerate has total debt of over Rs 22,000 crore on its books. The Bangalore airport is Fairfax Group’s largest investment in the country since it opened an India-dedicated investment company in 2014. It is also the company biggest bet on India’s infrastructure sector. Post the deal, Fairfax will hold 38% of BIAL, followed by Siemens Project Ventures with 26% while the governments of India and Karnataka will each own 13%. GVK will hold the remaining 10%. When contacted, BIAL managing director Sanjay Reddy told ET that GVK will “continue to be responsible for the management of the company and also operate the airport. The MD and CEO will be from GVK,” Separately, a person close to the development said that Fairfax may nominate Watsa himself, Harsha Raghavan, CEO of its affiliateFairbridge Capital and Deepak Parekh, chairman of HDFC and an independent director at Fairfax as board representatives in BIAL. The rest of the board composition is yet to be decided. According to its latest annual report, BIAL’s board as of end FY16 had former Air India chief and chief-secretary Karnataka governmentArvind Jadhav as chairman, GVK Reddy as co-chairman, Sanjay Reddy as managing director, GVK CFO Issac George, GVK board member Krishna Ram Bhupal, Airports Authority of India’s Sudhir Raheja, Venkatramana Hedge from the aviation ministry, IAS officers Vandita Sharma and Arvind Shrivastava, DR Kaarthikeyan, as well as Basil Justin Wetters, Johannes Schmidt, Pramod Bhambani and Daniel Schmucki from Siemens. S Balasubramanian and A Meher Prasad were independent directors. A few months earlier, Subhash Chandra Khuntia, the new chief secretary of the Karnataka government took over as chairman, BIAL. Bangalore airport handled more than 20 million passengers last year. It now has a built capacity to cater to 20 million passengers annually but upon completion of its expansion plans the number can go up to 50 million. Michael Irvin Authentic Jersey
Budget 2017: Ministry seeks cut in excise duty on jet fuel
The civil aviation ministry, as part of its Budget recommendations, has sought a reduction in excise duty on aviation turbine fuel (ATF), or jet fuel, to 8% from 14%, by rolling back an increase made last year. The government had raised the duty to compensate for its tax loss, as global crude oil prices fell to below $30 a barrel. Crude oil prices have doubled now. “Excise duty was raised when crude prices were low. Now they are inching up and the government can easily cut excise duty, which will also help shield airlines from a hike in jet fuel prices,” said a government official, who did not want to be named. “The government’s revenue would also not be impacted, as any revenue impact shall be compensated by a positive realisation due to the high output multiplier,” said an industry source, pointing to the impact a healthy industry can have on the economy. Rising fuel cost is a concern for the airline industry, which has started reporting profits after a long spell of losses. A more than 20% increase in air passengers and low fuel prices were the key drivers of the improved performance. To be sure, the duty hike helped temper volatility in fuel prices — though local prices didn’t fall in line with global rates earlier, they may not rise too much either now, if the government rolls back the tax increase it made. “Any rise in price of fuel, which constitutes a large part of our cost, is a concern but we may not be impacted that much because the government was raising taxes when crude was falling. So, the full benefit of crude decline was never transferred to airlines, which can act as a shield for us,” SpiceJet Chairman Ajay Singh said at a press conference last week. The ministry is, for the first time, sending the Budget wishlist after getting it vetted by professional consultants. This decision was in line with an idea mooted by the minister of state for civil aviation Jayant Sinha, who had called a meeting of all industry representatives to discuss Budget demands last week. Other requests include keeping ATF in the GST ambit. Fuel products aren’t included under GST and are set to attract higher taxes than those proposed under the new indirect tax system. “ATF is kept outside the GST ambit. However, globally ATF is delinked from other petroleum products and is included under the scope of GST and not considered a ‘sin’ product. Vonn Bell Authentic Jersey
No demonetisation impact; airlines flew 23.91% more passengers in December
In a clear indication of not being impacted by the government’s demonetisation move, which has seen sectors witnessing drop in demand, air passengers flown by airlines during December grew by 23.91% over same month last year, shows data released today by Directorate General of Civil Aviation (DGCA). The aviation sector, in terms of passenger growth, had registered a growth of 22.45% during November – PM Modi had announced a move to demonetise Rs 500 and Rs 1,000 notes on November 8, 2016. During December, which is also traditionally a peak travel month, all national scheduled carriers flew their planes with over 80% of their seats full. The list was led by SpiceJet, which recorded load factors of 93.7% and flying its panes with over 90% seats full for 21 months in a row. IndiGo came close second by flying its plane with 91.45 full followed by GoAir with 90.7% PLF. SpiceJet also topped the chart of airlines that flew the highest number of its flights on time. The data shows that SpiceJet flew 70% of its flights on time at four airports –Delhi, Mumbai, Hyderabad and Bengaluru- in the country. Jet Airways and Jet Lite came second by flying 64.3% of its flights full followed by Vistara, which flew 64.2% of its flights full. Air India was last in the list by flying 59% of its flights in time. Roquan Smith Jersey
Ramp up copter production, Defence Ministry tells HAL
With the armed forces projecting the need for some 700 helicopters — light utility and armed — the Defence Ministry (MoD) has asked the public sector giant Hindustan Aeronautics Limited (HAL) to ramp up production, speed up existing under-development projects and start out-sourcing work. The HAL, headquartered at Bengaluru, produces some 22-24 advanced light helicopters (ALH), the Dhruv, annually and some 200 of these are flying; however, the requirement is huge. In the second phase, rapid production of light utility helicopters (LUH) and light combat helicopter (LCH) will start. Prototypes of both are ready but need operational clearance. The MoD wants HAL to produce up to 85-90 copters per annum of these three types – the Dhruv, LUH and LCH — said sources, while adding that out-sourcing of some work had been suggested on the lines of global manufacturing practices. Andre Johnson Jersey
CBI case a ‘shock’; will hit Air India hard, says Ashwani Lohani
With CBI registering a case related to software procurement at Air India, airline chief Ashwani Lohani today termed it as a “shock” saying the omnipresent shadow of vigilance and other probe agencies over processes undertaken by the executive has caused maximum damage to the public sector. The case has come as a shock because ostensibly as per the stand taken by the company as well as its parent ministry, there may be procedural lacunae but “there is no apparent malafide in this case”, he said. While observing that “perhaps there is more to it than meets the eye,” Lohani in a strongly-worded blog also said regardless of the issue, such an investigation is bound to hit the company hard. Besides, there is the pain of digging out old papers, questioning of many including the innocent and the honest and its attendant ramifications, he noted. CBI has registered a case against unknown officials of Air India, German firm SAP AG and IT major IBM in connection with alleged irregularities in procurement of software worth Rs 225 crore by the national carrier in 2011. “Air India that has been a victim of gross indecision in recent years and only lately had started to come out of its slumber will also take a hit, I am absolutely certain, as an outcome of the unfortunate turn that this case has now taken,” he said. In the blog titled ‘Pinning the executive down Those who idle shall commit no mistakes!’, Lohani said he was unable to appreciate the basic premise that a non-executive is required to keep an eye on every single aspect of working of the executive. “… that we should have checks and balances that are highly tilted in favour of the checks,” he added. Lohani, who took over as Chairman and Managing Director of Air India more than a year ago, has been steering efforts to revive the fortunes of the national carrier. Known for speaking his heart, the Air India chief said the case would further strengthen the belief that following processes is important and deliverance can take a back seat. “The omnipresent shadow of vigilance and other more powerful investigative agencies over the minutest processes undertaken by the executive is one single factor that has caused the maximum damage to the public sector in our nation,” he noted. Air India is surviving on a Rs 30,000 crore bailout package for a ten-year period which was extended by the previous UPA government. Ryan Kesler Jersey
44 airports have potential for operations under UDAN: Report
About 44 airports across the country have “high potential” for operations under the ambitious Regional Connectivity Scheme (RCS) for civil aviation, UDAN, according to a report brought out by apex industry body FICCI has said. “Based on the geographical, operational and commercial parameters, 44 out of the 414 underserved and unserved airports have high potential under RCS. “We have also identified around 370 potential destinations for the shortlisted airports, including metros, state capitals and important commercial, industrial and tourism centres,” said the FICCI report, brought out in concert with global professional service company KPMG. Uttar Pradesh has four high potential RCS destinations, three each in Maharashtra, Rajasthan, West Bengal, Assam, two each in Arunachal Pradesh, Meghalaya, Bihar, Karnataka, Himachal Pradesh, Gujarat, Chhattisgarh and one each in Andhra Pradesh, Telangana, Tamil Nadu, Odisha, J&K, Puducherry, Lakshadweep, Daman and Diu, Haryana, Madhya Pradesh Jharkhand and Uttarakhand. “So far 22 states have joined the RCS and we have identified 30 airports where operations could be started immediately,” Union Civil Aviation Secretary Rajiv Nayan Choubey told PTI. RCS, or UDAN ((Ude Desh Ka Aam Naagrik), was introduced as part of the National Civil Aviation Policy 2016 and was formally launched in October last. It provides an opportunity to take flying to the masses by way of fiscal incentives, infrastructure support and monetary subsidies (viability gap funding). Noting that RCS was a good scheme, Regional Director of International Civil Aviation Organisation Arun Mishra, however, said India did not have the wherewithal right now for RCS to become successful. “They are trying to build the wherewithal but it will take some time,” he said. “We have to be careful about creating the enabling conditions for this scheme to become successful. One of the most important things is the right size of aircraft that you need.” He said a plan was required to induct smaller aircraft for RCS operations. “Many of the airports (identified for RCS) do not have big runways, so they can’t take regular aircraft. We need to induct smaller aircraft for short runways for short takeoffs and landings. “Those aircraft are not available in our country,” Mishra, who earlier served as Director General of Civil Aviation, pointed out. Also, Mishra said, there was shortage of pilots and crew. “Small aircraft need specialised crew. We need a special initiative from the government to build that up. Pilots and engineers can’t come overnight. We need to train them,” he added. “India produced only about 200-300 pilots every year. “The Civil Aviation University in China has 2000 trainers. It has 265 aircraft for training purposes,” the ICAO official pointed out. Observing that aviation created high value jobs and has multiplier economic effect, Mishra said “one aircraft that comes to the country, creates 600 jobs, directly and indirectly. These were not regular jobs that paid Rs 5,000 or Rs 10,000 a month but those that paid Rs 50,000 or Rs 60,000.” “Essentially, necessary infrastructure needs to be created for RCS to become successful. Airports Authority of India has readied 55 airports and there they can start the RCS,” Mishra added. Meanwhile, the FICCI report suggested that Viability Gap Funding under RCS be extended from the proposed three to five years or more as these airfields might taken even longer to become financially sustainable. RCS operators should also be allowed to use pilots, cabin and maintenance crew of other airlines and allow foreign registered aircraft for operations. Nolan Ryan Jersey
Govt to spend Rs. 16k cr in the next 5 yrs on airport infrastructure
The government is now working on a national level plan to make unused airstrips operational again, which will offer easy air connectivity to the people who are living in far-flung areas of the country. For this, the government will be spending Rs.16,000 crore in the next five years to upgrade the airport infrastructure, said Civil Aviation Secretary R. N. Choubey on Friday. Choubey was speaking at the Aviation Summit 2017, jointly organised by Ministry of Civil Aviation, government of Andhra Pradesh and Federation of Indian Chambers of Commerce and Industry (FICCI) in Vijaywada city of Andhra Pradesh. “We want to increase the number of air passengers to such a level that in the next five to seven years, India will become the third largest aviation market in the world. That’s the kind of market which is available here,” he said. Under the regional connectivity scheme, the government is providing 50-60% viability gap funding to airlines that connect unconnected airports, he added. Choubey informed that this is the first time that the civil aviation sector has achieved parity with the railways. “Civil aviation sector in India has achieved annual turnover of Rs. 1.4 lakh crore as compared to Rs. 1.6 lakh crore of Indian railways, he said. “Our airfare is comparable now with the fares of AC trains. Civil aviation was perceived in India as a mode of transport for only the rich. But now the change in perception among people as well as policy is happening,” he added. Gareon Conley Authentic Jersey