BRINGING PEOPLE AND PLACES CLOSER

Syed Shahnawaz Hussain *

---

Since the dawn of Independence, civil aviation in India has made giant strides and today it is a major contributor to the growth of the national economy. Apart from providing connectivity in a large and diverse country like India and serving the transportation needs of people in a speedy, cost-effective and efficient manner, the aviation sector has also greatly facilitated the development of domestic and international tourism, business, commerce and trade. Air India and Indian Airlines are recognised as symbols of national pride both within and outside the country.

As we observe our nation’s 54th Republic Day, the Ministry of Civil Aviation renews its commitment to the advancement and growth of aviation in India and re-dedicates itself to face the challenges that lie ahead under the leadership of our Prime Minister, Shri Atal Bihari Vajpayee.

Of late, the aviation industry has been facing difficult times. Even before the September 11 terrorist attacks in USA, the industry was facing the acute pressure of global recession. International passenger growth in the first and second quarters in 2001 was only 6.3 per cent and 2.6 per cent respectively as compared to 9 per cent increase in 2000. Similarly, the Indian market was growing only at the rate of 2.4 per cent in early 2001 as compared to 6 per cent in 2000. September 11 and the events following it have had a very adverse impact on the airline industry. There was a severe erosion of passenger confidence in respect of the safety and security of air travel. For the first time after the Gulf war, there was reduction in the passenger traffic on a year-to-year basis. The decrease in global passenger traffic was 4 per cent in 2001 over 2000.

Because of its geo-political situation India was all the more affected. India has been bearing the effect of cross-border terrorism. The terrorist attack on Parliament made the situation worse for the airline and hotel industry in India. Many airlines closed their operations to India and some others reduced their services. The cut in total capacity was to the tune of about 17000 seats per week.

In this scenario, regaining the confidence of passengers became the highest priority of the Government. The Government and its agencies responded to the situation in an exemplary manner. Several measures had already been introduced following the hijack of Indian Airlines aircraft from Kathmandu which were further strengthened after the attack on Colombo airport. The Central Industrial Security Force has already been deployed at 45 airports in the country for their security. The presence of this professional and disciplined force had an immediate and positive effect on passenger confidence. Other major steps included deployment of sky marshals both in national and private domestic airlines, deployment of strike forces at all major airports and strengthening of cockpit doors in aircraft. The maintenance and safety audit regime were further improved and today our standards are among the best in the world. This has been confirmed through independent assessments by the Federal Aviation Administration (FAA). All these steps have resulted in renewing the confidence of the passengers in the safety and security of air travel.

Despite these temporary setbacks, civil aviation in India has a great future. The International Civil Aviation Organisation (ICAO) has projected India as one of the fastest growing markets in the world, both in passenger and cargo traffic.The growth in our traffic is estimated at 7 per cent per year till 2015 which is higher than 5.6 per cent for Europe and 6.8 per cent for South East Asia.

Initiatives

The NDA Government at the Centre has a vision for establishing a world-class aviation sector in India that will be second to none. This includes making our airlines and airports comparable to any in the world, enhancing safety and security measures to make it at par with the highest international standards and establish affordable air services linking every nook and corner of our nation. It is our dream to create and consolidate a competitive, efficient, safe and user-friendly civil aviation environment in the country.

As a first step, the Government is formulating a comprehensive Civil Aviation Policy covering all aspects in the field of civil aviation. We will be emphasizing the increasing role of private sector not only for reasons of bridging the gaps in resources but also to bring in greater competition and cost-efficiency in management of aviation infrastructure.

The Government has approved establishment of new international airports at Hyderabad and Bangalore. The State Governments of Andhra Pradesh and Karnataka have initiated effective steps to implement these projects, with 74 per cent participation by the private sector and State Governments while the Airports Authority of India will hold the balance of 26 per cent equity. These world class Greenfield Airports are expected to become operational within the next 3 to 4 years. A special package of concessions has also been announced in the Budget for 2002-03 to encourage private sector participation in Greenfield Airports which includes availability of land and related infrastructure from the State Governments; exemption from levy of the Inland Air Travel Tax (IATT) and Foreign Travel Tax (FTT) and financial assistance or equity participation by Airports Authority of India.

Restructuring of the four metro airports of Delhi, Mumbai, Chennai and Kolkata has been taken up with a view to upgrading them to world-class standards, with significant investments and infusion of technology and managerial skills from the private sector. This restructuring exercise is planned to be completed by October 2003. There is also a proposal to attract private participation in the development of selected non-metro airports as well.

A project is under implementation jointly by the Airports Authority of India and the Indian Space Research Organisation for developing indigenous capabilities for providing satellite-based navigation services. This is in the line with ICAO decision to switch over to satellite-based navigation worldwide by the year 2010. With this India joins the select club of USA, Russia and the European Union, which are developing the capability to provide satellite-based navigation services.

Along with airports, it is also planned also planning to restructure the airlines to meet the global challenges. They should be lean, technologically advanced and customer-focused airlines. Despite difficult circumstances, after a gap of six years Air-India has registered a profit of Rs.15.44 crore in 2001-02. In the first six months of the current year also, it is likely to register a net profit of Rs. 46.79 crore. The management and employees of Air India have been exhorted to target a profit of Rs. 100 crore for the financial year 2002-03. With the arrival of more dry-leased aircraft and after introducing services on Guwahati / Bangkok and Kuwait / AI Ain (UAE)/ Kozhikode sectors, Air India has begun thrice weekly flights on Paris / New York route on December 3, 2002. With effect from December 8, 2002, Air India has also resumed operations to Frankfurt. The flights will be operated thrice a week on the Bombay-Delhi-Frankfurt sector. This was a long-felt need of the passengers since Frankfurt is a major international hub providing convenient connections to all parts of the world.

Air India and Indian Airlines have taken steps to have greater synergies through hub and spoke arrangements and through seamless transfers at some airports. Indian Airlines has now started 23 flights per week on domestic routes as hub and spoke arrangements with Air India. Seamless transfer of passengers between Air India and Indian Airlines have also commenced at Delhi and Mumbai airports from December 1, which will be a major convenience to passengers. In order to increase the capacity and speed up the purchase of new aircraft, the Board of Indian Airlines has approved dry-lease of 5 additional A-320 aircraft for three years, extendable by two years. The aircraft will be delivered between February and May 2003.

Haj Operations

The NDA Government has paid special attention to Haj operations. After carrying out Haj operations successfully in 2002, Air India will operate Haj flights with its own aircraft in 2003. During the Haj 2003, Air India, Indian Airlines and Saudi Airlines are expected to carry 72,000 Haj pilgrims from 12 different embarkation points in India (Delhi, Mumbai, Chennai, Kolkata, Gaya, Lucknow, Srinagar, Ahmedabad, Nagpur, Hyderabad, Bangalore and Kozhikode). Nagpur and Gaya are new embarkation points that are being added. Indian Airlines proposes to operate 36 flights in two phases between Srinagar and Jeddah. The total number of pilgrims proposed to be carried by Indian Airlines is 7,800. Indian Airlines will also operate 15 Hub & Spoke Haj services between Gaya and Kolkata on behalf of Air India from January 2003.

Focus

The Government has given greater focus to the North Eastern Region in various sectors, including aviation. In order to provide inexpensive air travel to the people of the North-Eastern States, the Government had decontrolled the pricing of Aviation Turbine Fuel(ATF) to small aircraft from April, 2001, amended Section 14 of the Central Sales Tax Act, 1956 to reduce the level of Sales Tax to 4 per cent on ATF and exempted all routes to, from and within the North Eastern Region from the levy of Inland Air Travel Tax (IATT) from March 1, 2002. In addition, IATT has been exempted on flights to or from Leh, Andaman & Nicobar Islands and Lakshadweep. In an effort to improve air connectivity in the North-Eastern Region, Guwahati has been declared as an international airport. Moreover, Indian Airlines has acquired four 50-seater ATR-42-320 aircraft on lease with the assistance of the Department for Development of North East Region and North Eastern Council that started operations from 25th December, 2002. In addition, Pawan Hans Helicopters Ltd. has deployed helicopters in Meghalaya, Sikkim, Arunachal Pradesh and Tripura for easy connectivity in the hilly areas.

India has the capacity and strength to be a major global player in the civil aviation sector and the Government will spare no efforts to realize this potential. Its endeavour is to enhance the performance of our airlines and our airports to match the highest international standards, encourage the private sector to participate in this task and place the passenger first in all our programmes. On the occasion of the Republic Day the Government pledges its resolve and direct our energies to achieve these objectives.

* Union Minister for Civil Aviation