The Cabinet, at its meeting in New Delhi approved the management contract agreement between CAE and Indira Gandhi Rashtriya Udaan Akademi in Rae Bareli to enhance the latter's capacity to churn out 100 pilots each year instead of 40 at present.
The management of IGRUA would be taken over by CAE for "better management of the Akademi in a more professional manner," Finance Minister P Chidambaram said after the Cabinet meeting chaired by Prime Minister Manmohan Singh.
The new institution at Gondia in Maharashtra, to be called the National Flying Training Institute, would be set up as a subsidiary of Airports Authority of India in
joint venture with CAE.
The NFTI is estimated to cost Rs 113.48 crore (Rs 1.13 billion). A new aerodrome would also be created at Gondia, Chidambaram said.
The upgradation and modernisation of IGRUA would cost about Rs 43.25 crore (Rs 432.5 million), including the cost of single and multi-engined aircraft and computer-based simulators.
The present strength of Indian pilots is 3,950 against the requirement of 4,540. Airlines are meeting the gap by employing foreign and expatriate pilots.
The shortage comes in the wake of projections that the domestic and international passenger traffic would grow from 60 million per annum now to 100 million in 2010 and 280 million in 2020.