Govt’s equity flow choke might block Air India revival path
Air India’s turnaround plan would be hit by a proposed curtailment in government equity infusion, the airline has informed the civil aviation ministry. Air India received Rs 1,713 crore of equity in the Budget, against its requirement of Rs 3,900 crore. The airline had requested the remaining Rs 2,200 crore to be released in the supplementary Budget. But the finance ministry has turned down the airline’s request. Lower equity infusion could result in increased finance costs and impact the turnaround plan, the airline has told the government. Air India is on a Rs 30,000-crore government bailout package and has till now received Rs 23,993 crore in equity, including Rs 1,713-crore investment this year. The infusion fund was to take care of the cash deficit and to be used for loan repayment. The airline was hoping to retire debt using the equity infusion in 2016. Last week, Air India Chairperson Ashwani Lohani wrote to the civil aviation ministry highlighting the perils of reduced equity infusion. The airline has sought the ministry’s intervention in the regard. Lohani confirmed to Business Standard he has written to the ministry. “Air India’s huge debt burden is a legacy of the past. It would be impossible to manage unless we are given full equity,” he said in response to a query. Lohani has in his letter pointed out that the airline was on an expansion mode and leasing aircraft, making it essential to have sufficient liquidity to take care of commitments. Further, he said, the airline would be forced to raise temporary loans from banks to bridge the liquidity gap, which might endanger the survival of the company. Daryl Johnston Authentic Jersey
Nepal cancels fast track road project with India’s IL&FS
In a surprise move, Nepal on Sunday announced the cancellation of all agreements with India’s Infrastructure Leasing and Finance Services for construction of a fast track road linking Kathmandu and Tarai. The Nepal government and IL&FS had signed an agreement in March to prepare the detailed project report ( DPR) of the $1 billion road project. At a meeting of the parliament’s development and finance committees, Ramesh Lekhak, Nepal’s planning and infrastructure minister announced all pacts signed with IL&FS are no more valid and all public announcements made by the Nepal government to develop the project are nixed. There was huge uproar in Nepal over awarding the projects to an Indian company after the then Sushil Koirala-led government decided to award the contract to IL&FS. IL&FS had spent over 40 million rupees for DPR and other paperwork, which the Nepal government has to compensate the Indian firm. Some experts expressed concern over the financial arrangement wherein Nepal has to reimburse the Indian firm. The government of K P Oli, which took over after Koirala, decided to construct the project using its own resources and allocated 5.5 billion rupees to construct the project. Given the strategic importance of the road, the current government has listed it as a national pride project. Minister Lekhak said, “Now all bodies concerned should make decision standing together in course of taking the nation’s pride project ahead.” Lekhak said the government has tabled a proposal for constructing the 76 kilometres of the road with its own investment. In October last year, Nepal’s Supreme Court had issued an interim order halting the government’s preparations to award the project to the Indian developer. During the International Conference on Nepal’s Reconstruction in June 25, 2015, Indian External Affairs Minister Sushma Swaraj had pledged to expedite construction of the projects. “Work on construction of the Kathmandu-Nijgadh fast track road and the Nijgadh airport with India’s participation be expedited. These projects will create new job opportunities, contribute to revenue, and facilitate long-term recovery,” she had said. Dennis Smith Jersey
Wind up Vijay Mallya’s Kingfisher Airlines: Karnataka High Court
In yet another jolt to beleaguered liquor baron Vijay Mallya, the Karnataka High Court on Friday ordered winding up of his now-defunct Kingfisher Airlines Limited for non-payment of dues to a UK-based firm. Pronouncing the judgement, Justice V Kothari observed that since KFA did not pay up dues to Aerotron, the court was ordering winding up of the airline company. “Admittedly the said amount has not been paid within the time provided in the agreement between the contending parties or even thereafter. Thus, satisfied that KFA was unable to pay its debts, the court orders the winding up of the airline company,” Justice Kothari said. As much as Rs 35 crore was due to be paid by KFA to Aerotron, for which an agreement was entered into between the two companies on February 24, 2012, whereby KFA had acknowledged its liability to pay the outstanding amounts in instalments spread over several months between March and October, 2012. Pierre Turgeon Authentic Jersey
Exorbitant air fares: No limit for metro routes as regional fares capped
Is the airline pricing mechanism fair and transparent in India? Why do people booking at the last minute – for emergency travel specially – have to pay a bomb? Well, the easy answer is that last minute bookings will mean most seats on a flight are already full and therefore, as per flexi-pricing rule followed by airlines, you end up paying a hefty premium for coming on board at a late hour. But how much premium is justified? And who decides if this premium is fair? According to data complied by online travel aggregator Makemytrip, a one way Delhi-Mumbai air ticket would have cost you a neat Rs 46,973 in September this year. Bengaluru-Delhi would have cost you Rs 46.906 in the same month. These are peak prices, the maximum that has been charged on these sectors in that month. The minimum fare during the month was Rs 2,198 on Delhi-Mumbai flights and Rs 2,395 on Bengaluru-Delhi flights. It is clear that peak pricing is about 20 times the lowest fare. As of now, there is no control over how much premium an airline can charge for last minute bookings. Civil Aviation Minister A Gajapathi Raju said in a written reply in Lok Sabha yesterday that airlines are free to fix “reasonable” tariff under sub-rule (1) of Rule 135, Aircraft Rules 1937 having regard to all relevant factors including “cost of operation, characteristics of service, reasonable profit and the generally prevailing tariff.” He also said that airlines remain compliant with the regulatory provisions of Sub-Rule 2 of Rule 135 as long as the fare charged by them does not exceed the fare established and displayed on their website. Dragan Bender Womens Jersey
No plan to regulate surge pricing for airlines – Govt of India
The central government has said that it has no plans to impose any limits on the fare charged by airlines in India. The clarification has come in the context of demands in certain quarters that airlines will be the next to see curbs on surge pricing after such limits were placed on taxi services such as Uber. Last week, the Karnataka High Court had dismissed a petition by Uber that had argued that state governments did not have the right to control surge pricing by cab companies. Like airlines, Uber and Ola have different fares depending on the demand. When demand is higher, so are the fares. States like Karnataka and Maharashtra have placed curbs on the maximum fares that taxis can charge. Karntaka, for example, has imposed a limit of Rs 19.5 per km for an air-conditioned cab and Rs 14.5 per km for non-ac cabs. There was speculation that since airlines also work on the same model, they too would see limits placed on the airfares. A ticket between Bangalore to Delhi can vary from around Rs 2,500 in times of low demand to as much as Rs 40,000 in times of heavy demand. Ozzie Newsome Authentic Jersey
Erumeli airport will be counter-productive: Experts
The State government’s new initiatives for a greenfield airport at Erumeli has surprised many in the aviation sector. For, they feel that the State’s urgent requirement is a string of airstrips or two-tier airports capable of ferrying passengers and tourists across the length and breadth of the State. Kerala is the only Indian state having four international airports in a small radius. Experts opine that rather than benefiting the aviation sector even slightly, setting up another international airport in a nondescript region will, to some extend, badly affect the performance of existing airports in the State. Speaking to ‘Express’, a senior official attached to the Kochi-headquartered Air India Express, the low-cost arm of Air India, said Erumeli was a town that came to life for around 68 days a year, when the Sabarimala pilgrim season began. “An airstrip or a small domestic airport capable of handling smaller aircrafts is enough to cater to the needs of Sabarimala pilgrims,” he stated. Cameron Johnston Jersey
Enhancing Regional Air Connectivity is top priority: Aviation Minister
The Indian civil aviation industry is exploring all possibilities for capacity expansion of leading airports in the country as well doing its best to make sure that the regional air connectivity is accomplished as per its UDAAN initiative, Ashok Gajapathi Raju Pusapati, Union Minister of Civil Aviation, said today at the inauguration of the two-day Aero Expo India-2016 organized by the PHD Chamber of Commerce and Industry under the patronage of Ministry of Civil Aviation. Present on the occasion were Jayant Sinha, Minister of State, Ministry of Civil Aviation and Rajiv Nayan Choubey, Secretary, Civil Aviation along with other dignitaries from India and overseas. Raju also stressed that though the domestic civil aviation industry has been growing at a rate of more than 20 per cent in the last few years, admitting that higher passenger growth in civil aviation sector is still a challenge for the government which could be won with addition of capacities in India’s leading airports. Speaking on the occasion, Sinha asked civil aviation industry to grow in such a manner so that its passenger traffic, currently estimated at about 150 million for domestic and overseas sector multiplies manifold and catches on pace with the air traffic of China which presently is calculated at 500 million per annum. In order to achieve this objective, the ministry has been adopting three pronged strategy under its UDAAN commitment which includes expansion of airports capacities, ensure regional connectivity and equip the air passenger with better level of satisfaction and experience under its Air Sewa initiative, emphasized the minister adding that the government would do all possible to transform the civil aviation sector. Choubey reiterated the government commitment for higher growth of civil aviation sector with all possible government’s initiatives in partnership spirit, adding that by December 2016 dozen of schedule commercial operations could begin to connect small towns in the country under its regional connectivity drive. Anthony Brown Authentic Jersey
Boeing to invest in new factory in India
Aerospace major Boeing will invest in a brand new factory in India and create an entire aviation ecosystem as far as its ‘Make in India’ plans for its fighter aircraft the F/A-18 Super Hornet are concerned, said the company’s F/A-18 Program vice-president Dan Gillian. He was speaking to a visiting Indian media team now in the U.S. The multirole, dual seat aircraft is reported to be of interest to India, and now features in “Make in India” offers. He said that in the India plan, huge opportunities exist in the supply and manufacture of avionics, engine parts and landing gear components. Further, with improvements in displays, which now worked like an iPad, there were prospects in the fields of graphics too. Adding to his remarks, Boeing India’s president Pratyush Kumar called it a “crown jewel project” which includes indigenisation and tapping into a supplier chain of vendors. This will attempt to mirror the system around the Super Hornet production line at St. Louis, U.S., which is now supported by 800 vendors in 44 states and employs 60,000 people. Mr. Kumar added that with this plant, India could not only look forward to manufacturing the Block II Super Hornet and even an Advanced Super Hornet but also help it design and build an Indian-made ‘next generation’ fighter. According to him, this would also help advance the country’s aerospace capabilities. Mike Nugent Authentic Jersey
Cathay Pacific plans to increase air cargo services to India
Cathay Pacifc Airways, the Hong Kong-based aviation company, is planning to increase the frequency of its cargo flights from the city to India, given the spurt in business. Currently, the carrier operates from six Indian cities and there are 25 freighter departures every week. “At this moment, we plan to optimise our network base in India and want to increase our frequency here,” Mark Sutch, Cathay Pacific’s General Manager (cargo sales and marketing) was quoted as saying by the PTI. During the first nine months of calendar year 2016, the airline’s cargo business grew about 8 percent in volume terms, up from 4 to 5 percent in the past. The carrier provides freight services from Delhi, Mumbai, Chennai, Kolkata, Bengaluru and Hyderabad. Alexei Emelin Womens Jersey
Parking made free at airports across India till November 21
If dealing with the cash crutch due to demonetisation was getting to your nerves there’s some relief coming your way. Parking at all Indian airports will be free until November 21, declared the civil aviation ministry. MoS, Civil Aviation Jayant Sinha took to social media website Twitter to write, “We heard you! To facilitate smooth movement, collection of parking charges at all airports suspended till midnight of 21 Nov! #AirSewa.” This move comes just days before the winter session of the Parliament behind where all opposition parties are expected to question the Modi government. The ministry in a statement said, “The Ministry of Civil Aviation has decided to suspend the collection of parking charges at all airports till midnight of November 21, 2016. This has been done in order to facilitate the smooth movement of passengers.” Matt Calvert Womens Jersey