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Home > Business > Special


A traffic jam in the Indian skies

Amitabha Roy Chowdhury | December 23, 2005

A 24 per cent increase in air travel and the launch of several new airlines, including low cost carriers, were the key developments in the Indian civil aviation sector in 2005, even as the government tried hard to cope with severe constraints caused by the heightened strain on limited infrastructure.

The process to restructure and modernise Delhi and Mumbai airports, which was slated to be concluded this year-end, suffered a delay of about a month.

Another prohibiting factor was the zooming price of jet fuel, which hit the bottom lines of the airlines and led to rise in fares even in some of the low cost carriers.

Faced with stiff competition in domestic and global markets, the government finally gave its nod to the two public sector carriers, Air India and Indian (erstwhile Indian Airlines), to go ahead with their fleet acquisition plans for a total of 111 aircraft from both aircraft majors, Boeing and Airbus Industrie.

Both the carriers also posted minor profits, after suffering losses for several years. Even as it permitted private carriers Jet Airways and Air Sahara to start global operations as per the prevailing norms, which require airlines to have five years domestic flying experience and a 20 aircraft fleet, the government signed bilateral air traffic agreements with several major countries, including the US and the UK, virtually opening up the sky for their designated airlines to expand operations here.

Foreign airlines showed keen interest in increasing their flight operations to and from India, with many of them also taking advantage of the limited 'open sky' policy operating in the winter season.

Infrastructural constraints remained a major factor prohibiting the surge in air traffic, with aircraft having to hover over major cities for an average of 30 minutes before being allowed to land due to choking congestion. This also led to the wastage of crores of rupees worth of aviation fuel for the airlines.

The much-touted restructuring of Delhi and Mumbai airports saw vehement opposition, not just from the trade unions and the Left parties, but the process also came under attack from several bidders.

Finally, the empowered group of ministers decided to set up another committee headed by the cabinet secretary to study whether the process already gone through was in accordance with the laid down norms and procedures.

The government also decided to consider the 'Alternative Plan' submitted by trade unions to upgrade the two major airports. Work on greenfield airports at Bangalore and Hyderabad started off and both are expected to be ready by 2008.

Fog continued to affect flight operations out of Delhi and consequently throughout the country, despite the Airports Authority of India installing the highest calibre Category-III instrument landing system to overcome the handicap.

AAI also took up work to create fast exit tracks, parking bays and install equipment to allow both runways at Delhi and Mumbai airports to function almost simultaneously to cater to increasing numbers of flights.

Besides drawing up proposals to modernise Kolkata and Chennai airports, the government also planned to go ahead with the immediate upgradation and modernisation of 35 major non-metro airports, with or without private participation on a case-to-case basis, with AAI beginning work on several of them.

Even after the lapse of over two years, the civil aviation ministry failed to bring out the National Civil Aviation Policy to chart out the path for the growth of the crucial sector, which itself seems to be right on the take-off path.

However, Minister Praful Patel said several major aspects of the Naresh Chandra Committee recommendations, suggesting a roadmap for the sector, had already been put into practice and made part of the operational policy.

Faced with growing number of airline companies springing up and the number of aircraft operating on the Indian air space, the aviation sector saw new airlines poaching on trained pilots of the established ones to fly their own fleet.

This led to the flight of pilots from the public sector carriers and established airlines like Jet Airways and Air Sahara to join new and upcoming carriers. Even pilots of Indian Air Force quit jobs to join private carriers.

The ministry took the initiative and convened a meeting of all airlines to work out norms for self-restraint by all carriers on the poaching issue.

It also allowed foreign pilots particularly commanders, to be employed in the Indian carriers on short-term contracts, besides raising the retirement age for commanders from 60 years to 61 and subsequently to 65 years.

The new airlines that came into existence during the year were Kingfisher Airlines, SpiceJet, Go Airlines and Paramount Aviation.

Two more airline companies have been granted the crucial 'No Objection Certificates'. These are Inter Globe Aviation (or IndiGo) and Indus Airways, which are expected to launch operations by early 2006.

Air-India's wholly-owned subsidiary Air India Express started full-capacity, low-cost operations mainly between Kerala and the Gulf, while Jet Airways launched charters for the Indian armed forces to Ladakh.

The new and upcoming airlines placed whopping orders for aircraft at the Paris Air Show early this year with Kingfisher becoming the first Indian airline to place orders for the largest aircraft A-380 and IndiGo showing intentions to acquire 100 planes from Airbus.

After Jet Airways and Air Deccan successfully launched their Initial Public Offers, the government allowed the two public carriers Indian and Air India to go ahead with their plans to raise money from the capital market by offloading 10-15 per cent equity.

While the two carriers are expected to announce IPOs in early 2006, Kingfisher is also scheduled to go the same way.

The ministry failed to bring a legislation to establish the Airport Economic Regulatory Authority in 2005 and promised to do it next year. It has set up a high-level panel to fine tune the functions of the Directorate General of Civil Aviation.

PTI


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