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IATA Cautions Against AAI’s Myopic Approach
Bhisham Mansukhani - Mumbai
IATA has cautioned against Airport Authority of India's (AAI)
policy regarding aeronautical charges as well as planning airport restructuring
in light of the developments on the international front.
According to Peter Bysouth, assistant director (Airport & ATC Charges) Asia
Pacific, IATA, India was in principal breach of its international agreements
due to its existing pricing policy and subsidies awarded to regional airports.
"The AAI will have to confront both serious criticism and the prospect
of losing revenue if it does not review some of its pricing policies. It is
presently levying a service tax on international aeronautical charges, which
is not in accordance to the ICAO agreement it has signed. From IATA's point
of view, the overflight and enroute charges levied by the AAI is about 20 per
cent higher. When every country signs their respective bilateral agreements,
they consent to levying aeronautical charges on a cost recovery and non-differentiating
basis while earning a reasonable amount of returns. But the AAI has been earning
a healthy profit over and above the cross subsidising for the regional airports,"
Bysouth said.
India also runs a risk, according to Bysouth, of losing revenue accruing from
international airlines overflying India. "For the moment, most carriers
are forced to traverse south of the Himalayas owing to the terrain. In the longer
term, when China restructures, they will capture a substantial share of India's
overflight revenue," he warned.
Bysouth also highlighted the parallel between Singapore and Dubai in their integrated
approach towards airport and airline development. "The government must
take a holistic approach rather than act in isolation. Allowing 100 per cent
international investment in domestic aviation and a partnership approach towards
planning pricing infrastructure with an industry-agreed capital equipment programme
can radically boost the country's domestic aviation growth," he said.
According to him, the gathering manpower problem is one that India cannot escape,
what with more than 500 aircraft orders already placed. "Engineers take
more than five years to train and need at least three years of experience. Pilots
need another five years to qualify for small aircraft. A 747 pilot requires
10 years by comparison. Most of these planes will be here in less than seven
years. But what is happening on ground to alleviate the problems that are round
the bend? It is important that we temper the exuberance with the slew of challenges
that confront domestic aviation in India," Bysouth said.
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