Jul 1 2017 | Focus

Flying High

Tier-2and Tier-3 cities are becoming newer growth engines. People from every nook and corner of the country especially the emerging cities are likely to benefit fromUDAN. The scheme was launched by Prime Minister Narendra Modi in April 2017from Shimla Airport. Sandeep Sharma takes a look at the sector....

Domestic airlines register 17.63% passengergrowth
Domestic airlines carried 465.87 lakh passengers during January-May, 2017 as against396.04 lakh during the corresponding period of previous year thereby registering a growth of 17.63%.

Passenger Load Factor
The passenger load factor in the month of May 2017 has shown increasing trend compared to previous month primarily due to beginning oftourist season. The passenger load factors of various scheduled domestic airlines in May 2017 are as follows:

Air Cargo likely to grow at 9 per cent
While delivering the keynote address at the India Integrated Transport& Logistics Summit 2017, the Minister for Civil Aviation, Ashok Gajapathi Raju had said that the air cargo is likely to grow at 9% in next few years. The logistic parks development is likely to support the cargo growth. Speaking atthe plenary session of the Summit, the Secretary of Ministry of Civil Aviation,R.N. Choubey had informed that a common framework for air cargo would come upin a year time so that freight operators, airlines, and security as well addressees come within one system. Common User Cargo Terminals would be create dat 17 airports. This will bring efficiency in handling air cargo.

Disinvestment of Air India
The Cabinet Committee on Economic Affairs, chaired by the Prime Minister Narendra Modi, has given its approval to fourth tranchere commendations of NITI Aayog on strategic disinvestment of CPSE (strategicdis investment of Air India and five of its subsidiaries) based on there commendations of Core Group of Secretaries on Disinvestment (CGD).

SpiceJet goes ahead to order 50 Q400 turbo prop aircraft
Low cost airlines SpiceJet had recently signed an initial pact with Boeing Co for the supply of 40 737 MAX planes worth $4.7 billion as part of its ambitious expansion plans. In addition, the airlines have announced its plans to purchase 50 Q400 turboprop aircraft worth $1.7 billion from Bombardier.

Airport development needs Rs 2 lakh crore of investment

Union Minister Jayant Sinha has said that India would require an investment of Rs 2-3 lakh crore for setting up new airports and adding capacity to the existing ones in the next 10-15 years. Around 31 airports have become operational in the last 2 years taking the total number of airports to 106 in place of 75 earlier. AAI to monetise five percent of its land for airport development

Airports Authority of India (AAI) currently has a land bank of 1.36lakh acre. The Government of India is keen to monetise around 7,000 acre of land owned by AAI and use it for building shopping centres, commercial offices and conference centres, among others. Some of the land will be used for cargo purposes as well.  Inter-ministerial consultations are on to amend the Airports Authority of India Act, 1994, paving way to expand the scope of usage for land owned by the Authority.

The government has already announced plans for developing and modernising 50 existing AAI airports at an indicative cost of Rs 50-100 crore each. While the Centre will provide budgetary support for airport development,AAI can use funds from land monetisation for airport development.

Centre approves Jewar airport project
The Government has granted in-principle approval for a Greenfield airport at Jewar in Greater Noida. The air traffic in the NCR region is expected to grow from the current level of 62 million passengers per annum to91 MPPA by 2020 and 109 MPPA by 2024. This would lead to capacity saturation atthe Indira Gandhi International Airport in Delhi. Yamuna Expressway Industrial Development Authority (YEIDA) is the implementing authority of the Jewar airport project. The Noida International Airport will be located 72 Km from IGI Airport and 65 Km from Hindon Air Force station Ghaziabad. An area of 3000hectare has been notified for the airport which will be developed in phases. Anarea of 1000 hectare will be developed in the first phase at an estimated costof Rs 10,000 crores. There will be one runway in the first phase. Three more runways will be developed in subsequent phases. The project cost is estimatedto be in the range of Rs 15000 crore to Rs 20000 crore. On completion, the airport is expected to cater to 30-50 million passengers per year over the next10 to 15 years. Government of Uttar Pradesh along with YEIDA will bear the costof land procurement. The project will be implemented in the PPP mode.

Delhi airport to have terminal for chartered flight
Delhi International Airport Limited (DIAL) is constructing a dedicated terminal for chartered flights. In order to meet the growing demand of VIPs who prefer to travel in private jets, the airport operator has started construction work on the terminal and likely to complete the same in three years. The new terminal will come up near the Indian Air Force area. Currently, all such movements are happening from Terminal 1, which is operating beyond its capacity.

AAI may explore second airport for Chennai
Airports Authority of India plans to construct second airport for thecity of Chennai. Around 3,000-5,000 acre of land is required for the greenfield airport. Walajabad and Madhurantakam in Kancheepuram district and Alamathy and Gummidipoondi in Tiruvallur district are the likely sites for setting up the airport.
Expansion of Coimbatore International Airport
The expansion of Coimbatore International Airport is still not happening due to long pending land acquisition issues. Around 630 acre of land is required to carry out the expansion plan. Initial estimate indicated requirement of 1200 acre of land. Demand for greenfield airport is also gaining ground as far as the Consumer forums are concerned.

Airports at Hosur, Neyveli and Salem
Airports Authority of India plans to make three airports at Hosur, Neyveli and Salem operational. MOU is likely to be signed between AAI, Civil Aviation Ministry and the State Government. The cost of Salem airport would beRs 9 crore and work has already started.

Bagdogra airport expansion project needs additional land
Bagdogra airport is located about 16 km from Siliguri Township and isthe nearest airport for Darjeeling and Sikkim. The airport expansion project is being considered due to increase passenger turnout. Airports Authority of India, the airport operator, plans to commence the new terminal construction work by the next quarter. To undertake expansion of the airport, AAI has sought land from the state Government near or adjacent to the current airbase.

Future Outlook
The civil aviation sector has emerged stronger and become the fastest growing industries in the country during the last three years. The domestic passenger traffic has grown at 19 per cent from about 6.1 crore in 2014 to 10crore in 2016-17. India is now the third largest aviation market in the world,with the promise to grow even further. Regional Connectivity Scheme (RCS) UDANis likely to be the game changer and propel the industry in the next league. 31currently served, 12 under-served and 27 unserved airports are now connecting128 RCS routes across the country. Due to this scheme, around 50 airports are being revived and 13 lakh new UDAN seats are being added annually under the first round of UDAN for a Viability Gap funding of Rs 205 crore. Dis investment of Air India may also improve the health of the ailing national carrier andusher in new era of advancement and customer delight.




UDAN Air Cargo