Backgrounder
1. INTRODUCTION:
Ministry of Civil Aviation is charged with the responsibility of-
· Formulation of National Policies and programmes for development and regulation of Civil Aviation.
· Devising and implementing schemes for orderly growth and expansion of civil air transport.
· Oversee the provision of airport facilities, air traffic services and carriage of passengers and goods by air.
· Administratively responsible also for the Commission of Railway Safety, a statutory body set up under the Railway Act.
Organizations under Ministry of Civil Aviation:
· Attached Offices
- Directorate General of Civil Aviation
- Bureau of Civil Aviation Security
- Commission of Railway Safety
· Public Sector Undertakings
- Airports Authority of India
- National Aviation Company of India Ltd. and its subsidiaries
- Pawan Hans Helicopters Ltd.
· Autonomous Organization
- Indira Gandhi Rashtriya Uran Akademi
2. NEW CIVIL AVIATION POLICY:
A revised draft Cabinet Note on National Civil Aviation Policy had been submitted to the Cabinet for approval on 16.5.2007. The Cabinet in its meeting held on 15th June, 2007 considered the note on National Civil Aviation Policy from this Ministry and decided to refer to a Group of Ministers (GoM) for further consideration. The first meeting of GOM was held on 14th August, 2007.
3. INDIA AVIATION 2008
It has been decided to hold India Aviation 2008, an exhibition cum conference in October, 2008 at Hyderabad and would include exhibitors from different areas like Airlines, Aircraft Manufacturers, MRO, Infrastructure companies, Airport services, security, management and maintenance.
4. LIBERALIZATION OF AIR SERVICES
In accordance with the policy of liberalization in the civil aviation sector and with a view to attract more foreign passengers, the Government has adopted overall liberal approach in the matter of grant of traffic rights under bilateral agreements with various foreign countries. The India-US aviation market has registered significant growth under the new revised Air Services Agreement signed between the two countries in 2005. Similarly traffic rights were enhanced with various other countries in order to enable greater connectivity to/from India. These countries included Australia, UK, Germany, China, France, Netherlands, Belgium, Canada, Singapore, Mauritius, New Zealand, UAE, Thailand, Italy, Russia, Taiwan, Finland, Maldives, Tanzania, Japan, Sri Lanka, UAE (Sharjah, Dubai & Abu Dhabi), Kuwait, Italy, Japan, Spain, Oman, Scandinavian countries,Egypt, Qatar, Jordan, Uzbekistan and Malaysia etc. This would not only lead to more flights and better connectivity from these countries to India but also provide more commercial opportunities to all operating carriers.
5. SIGNING OF NEW/REVISED AIR SERVICES AGREEMENT
Signing of a new Air Services Agreement is first milestone to achieve the purpose of establishing air connectivity with new countries. During the recent past, a number of new Air Services Agreements were initiated/singed based on modern practices in civil aviation sector. Air Services Agreement with some countries were signed way back and needed updating in view of the changing circumstances and developments in international civil aviation scenario, and with respect to newer standard and recommended practices. Some of these countries are USA, UK, Australia, Brazil, New Zealand, Iceland, Finland, Tunisia and Qatar.
6. INTERNATIONAL OPERATION BY PRIVATE SCHEDULED AIRLINES ON INDIA-GULF SECTORS:
The Government has decided to open the India-Gulf route to eligible private schedule carriers w.e.f. 1st January, 2008 and under this decision Jet Airways has been permitted to operate international services in certain India-Gulf sectors from 1st January, 2008.
7. ICAO GENERAL ASSEMBLY:
In the ICAO General Assembly held in Montreal from 18th to 28th September, 2007, India has been re-elected to the Council of ICAO for a period of 3 years. India has consistently been elected to the Council since 1944.
8. GROWTH OF THE DOMESTIC PASSENGER TRAFFIC:
During the year 2007, domestic airline passenger traffic has shown a growth of 36.74% in first nine months (January to September, 2007) as compared to the corresponding period of 2006. The number of Scheduled Passenger Airline Operators is 13 (Amongst these M/s. Indus Airways is non operational at present). The number of aircraft in their fleet has risen to about 333 upto 14.8.2007. In 2007 (upto October, 2007), these scheduled airline operators have been given permission to import another 56 aircraft.
9. PROMOTION OF REGIONAL AIR CONNECTIVITY:
To expand air connectivity on Tier II and Tier III cities and to promote regional air connectivity a separate category of permit, Scheduled Air Transport (Regional) Services had been introduced with the approval of Hon’ble Minister of Civil Aviation. Accordingly, Director General of Civil Aviation had issued Civil Aviation Requirements (CAR) on Scheduled Air Transport Regional Services on 23.08.2007.
10: POLICY FOR GREENFIELD AIRPORTS:
Government is committed to streamline the policy framework to remove obstacles in approval process for setting up of new airports. An Inter Ministerial Group has finalized the draft policy for Greenfield airports, which was considered by the Committee on Infrastructure in its last meeting. The Policy aims to provide a clear-cut architecture of the approval mechanism for setting up of new airports. Guidelines for granting technical approvals by various agencies involved in setting up of an airport would be provided upfront to provide clarity. A time bound process for approval of proposals received in this regard is also being suggested. The policy is likely to be finalized in a couple of months.
11. DEVELOPMENT OF AIRPORT INFRASTRUCTURE:
Airport infrastructure has been undertaken through the PPP route in major metro cities like Delhi, Mumbai, Bangalore and Hyderabad. Modernisation of the Kolkata and Chennai airports is being undertaken by the AAI. For the non-metro airports AAI is responsible for the airside development. For this purpose 35 airports have been selected and the work is in progress. Of these 24 airports would be taken up for city side development through PPP including maintenance and operation of the terminal buildings, cargo operations and real estate development. The aim of the Government is to transform these airports into world-class facilities through this hybrid mechanism. RFQ for Amritsar and Udaipur has already been issued and while the bids are yet to be received by next month the initial response from prospective bidders has been promising. The RFQ for Trichy, Vizag will be issued shortly.
12. TO STREAMLINE AND PROMOTE THE CARGO OPERATIONS:
To streamline and promote the cargo operations an Inter Ministerial Group is looking into various aspects of dwell time for air cargo at airports. Based on the recommendations of the IMG the free time available for the cargo has been reduced to 3 days from 5 days. The IMG is deliberating on additional steps to be taken to streamline the procedures related to air cargo to make the operations more efficient. Other steps are also being contemplated to promote cargo activities, which at present are much below the potential available in the country. One of the steps contemplated is to promote cargo operations through PPP at non-metro airports, which is expected to give a fillip to air cargo operations.
13. AIRPORT CONNECTIVITY:
The Ministry has also taken up the issue of improving connectivity to major airports and selected 10 such airports in the first phase which are as follows:
i) CSI Airport at Mumbai and the proposed Navi Mumbai
ii) IGI Airport at Delhi and the proposed Greater Noida airport at Jawar
iii) Chennai airport
iv) Bangalore airport
v) Kolkata airport
vi) Hyderabad airport
vii) Ahmedabad airport
viii) Cochin airport
ix) Coimbatore airport
x) Jaipur airpot
The Ministry has firmed up various connectivity plans for four of the above airports and is working on similar proposals for the remaining airports.
14. NATIONAL FLYING TRAINING INSTITUTE AT GONDIA, MAHARASHTRA:
The Ministry plans to establish a premier pilot training institute at Gondia, Maharashtra to augment the ongoing efforts of Flying Training Schools for increasing the number of qualified and well-trained pilots, to tackle the huge demand for pilots in the industry.
15. INDIRA GANDHI RASHTRIYA URAN AKADEMI:
Based on the recommendations of the Committee set up under the Chairmanship of Captain N.K.Dawar, ex – Director, IGRUA for suitable modernization, renovation and upgradation of infrastructure of the IGRUA, with a view to enhancing the number of trainees being trained at IGRUA from 40 to 100 trainees per course for Commercial Pilot Licence (CPL), two projects viz. project for upgradation of existing training facilities at IGRUA at an estimated cost of Rs. 21.82 crores and the other proposal of augmentation of training facilities like acquisition of single & multi engine aircraft and modern training equipment has been approved at a cost not exceeding Rs.41.30 crore. The selection of suitable trainer aircraft is underway.
In the 55th meeting of the Governing Council of IGRUA. After considering various pros and cons, it was decided that professionalism of management may be undertaken through a Management Contract with experts and professional agencies in the field. Based on this decision, an Empowered Committee comprising of officers of Ministry of Civil Aviation, DGCA and Director, IGRUA was constituted. Based on the proposal received by them M/s. CAE Canada was selected as the management contract partner for IGRUA and the approval of the Governing Council has been obtained. A non-binding MoU has been signed between M/s. CAE and IGRUA for the proposed management contract.
16. NATIONAL AVIATION COMPANY OF INDIA LIMITED:
The Indian Aviation environment has changed significantly over the last few years with rapid increase in demand for domestic and international air services. Expansion of capacity by current airline players (domestic, private and global), as well as entry of new players has helped meet this demand and at the same time significantly altered the competitive landscape. Rising fuel prices and shortage of skilled manpower is expected to put further pressure on all current airline operators.
It was felt that the integration of Air India and Indian Airlines could lead to developing seamless connectivity network of regional operations, short to medium-haul trunk operations, long haul operations, which would cumulatively lead to improved product through increased network coverage. Their merger had the potential to provide substantial synergy for procurement, sales and distribution besides affording an opportunity for financial restructuring/strengthening by leveraging common assets.
The Ministry of Corporate Affairs has approved the merger of Air India and Indian Airlines with National Aviation Company of India Limited on 22nd August, 2007 and the companies have amalgamated on 27th August, 2007.
It is expected that synergies will ramp up over three years as the extent of integration increases between the two airlines. The current estimate is for Rs.150 crores in year 1, Rs.370 crores in year 2 and by the third year, a synergy of about Rs.820 crores equally split into revenue and cost synergies of Rs.410 crores each, is expected.
This merger has the potential to allow the airlines to scale new horizons, establish fresh benchmarks for service, efficiency & reliability and emerge as a force to be reckoned with in the global aviation industry.
17. MODERNISATION/EXPANSION OF KOLKATA AIRPORT:
Committee on Infrastructure, in its 14th meeting held on 18.04.2007 decided that Airports Authority of India (AAI) would develop the Kolkata Airport from its own resources. An Inter-Ministerial Group (IMG) under the Chairmanship of Secretary was constituted to finalise the Action Plan for development of Kolkata airport. AAI has prepared a detailed Action Plan for development of airport at a cost of Rs.1942.51 crores.
The salient features of Action Plan are as under:
Extension of secondary runway by 400 m on the southern end, and construction of rapid exit taxiway.
Extension of Apron for taking the aircraft parking bays from 29 to 52.
Addition and upgradation of CNS/ATC equipments and construction of technical block & ATC tower.
Providing connectivity of Airport Terminal to the Circular Rail Station.
Construction of an Integrated Passenger Terminal Building with annual capacity of 20 million (16 million domestic and 4 million international), which is expected to saturate in 2015-16.
18. EXPANSION/MODERNISATION OF CHENNAI AIRPORT:
Committee on Infrastructure, in its 14th meeting held on 18.04.2007 decided that the Chennai Airport would be developed by Airports Authority of India (AAI) from its own resources. An Inter-Ministerial Group (IMG) under the Chairmanship of Secretary was constituted to finalise the Action Plan for development of Chennai
airport. AAI has prepared a detailed Action Plan for development of airport at a cost of Rs. 2062 crores.
The salient feature of Action Plan as under:
The project envisages expansion of domestic terminal building by 72700 sq.m. to cater additional 10 million passengers p.a. The international terminal building is to be expanded by another 64300 sq.m. to cater to additional 4 million passengers p.a. Total passenger handling capacity will, therefore, become 23 million passengers p.a. (16 mppa domestic + 7 mppa international).
Expansion of secondary runway so that airport is able to handle 50 aircraft movements per hour. This capacity is expected to be sufficient to cater to air side requirements up to 2015-16.
The cost of development of terminal building and city side activities, including a multi level car park, is estimated to be Rs.1527 crores out of which Rs.638 crores would be on new domestic terminal building, Rs.532 crores on extension of international terminal, Rs.141 crores on facelift/modification of existing terminals and Rs.206.77 crores on multi level car park including commercial development. The apron work consisting of expansion of secondary runway, construction of taxiway and additional bays would cost Rs.535 crores. The project is estimated to be financially viable with an IRR (pre tax) of 12.3% and ERR (pre tax) of 12.6%, on completion of project basis.
Remodeling of the existing domestic and international terminal buildings to accommodate further 13 million domestic passengers and 3 million international passengers, in the second phase.
Completion of terminal and city side work by June 2010 and air side by February 2010.
19. ESTABLISHMENT OF AIRPORT ECONOMIC REGULATORY AUTHORITY (AERA):
With the objective to create a level playing field, to foster healthy competition amongst all airports, encourage investment in airport facilities, regulation of tariffs of aeronautical services, protection of reasonable interest of users, operation of efficient, economic and viable airports, etc., it has been decided to set up an Airport Economic Regulatory Authority (AERA). The functions of the Authority shall be as under:
To fix, review and approve tariff structure for the aeronautical services taking into consideration the capital expenditure incurred, the service provided, its quality and other relevant factors;
To fix, review and approve users development fees which may be levied by service provider for development of an airport;
To monitor the set performance standards relating to quality, continuity and reliability of service as prescribed by Central Government or its authorized agencies through concession agreement or such other agreement;
To call for such information required to review the regulated tariff structure;
To perform such other functions as may be entrusted to it by the Central Government or as may be necessary to carry out the provisions of this Act.
Airports Economic Regulatory Authority of India Bill, 2007 was introduced in the Lok Sabha on 5th September, 2007.
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