Event Round-up

India: Land of promise

Going by the way the world is looking at India and tracking down it's every move across sectors and industries, one can easily conclude that 'India' is the latest 'catch-word' or should we say 'cash-word' for growth. The Indian aviation sector is no exception and top of the line on the radar of the global aviation business.

According to aviation experts, India would require 1,000 aircrafts in the next 12 to 13 years, while passenger traffic would go up six times, from 32 million to 180 million, with investment opportunities in airports and infrastructure estimated to rise to around US$ 120 billion. Speaking about India's aviation potential, Praful Patel, minister for civil aviation, Government of India, said, "Aviation acts as a catalyst in integrating the world. The last few years have seen new impetus in aviation as it facilitates economic growth, equitable development and generates employment. India has seen a 25 per cent annual compounded growth in three years with a 50 per cent growth in the domestic sector and 20 per cent in the international sector. India has a total of approximately 300 aircrafts now and the number of air travellers come to about 0.8 per cent of the population. By the time even 10 per cent of the population begins to fly, we will need about 5,000 aircrafts." He further added that India for the next 10 years would enjoy a compounded growth of about 25 per cent in the aviation sector, which will be sustained for the next 10 to 15 years. He attributed the reason for this growth to the liberalisation of the regime and the proactive bi-laterals which have minimised restrictions in the free flow of passengers.

According to civil aviation ministry estimates, Indian airports are likely to handle 400 million passengers per annum by 2020. The projections for Mumbai are similarly huge. Mumbai is expected to handle 91 million passengers by 2030-31, from the current 20 million. According to government sources, the proposed Navi Mumbai International Airport would cost around Rs 4,235 crore and will be run on a public-private partnership basis through an SPV. While the Airport Authority of India and Maharashtra's City and Industrial Development Corporation will jointly hold 26 per cent in the SPV, a private partner is expected to retain the balance 74 per cent.

The US interest

Taking this cue and to further promote greater collaboration between the US and Indian aviation sectors, US Trade and Development Agency (USTDA), in partnership with the US Federal Aviation Administration (FAA), lead by Marion C Blakey, administrator, FAA and the ministry of civil aviation (MOCA), Government of India, sponsored the first ever US - India Aviation Partnership Summit, in New Delhi from 23rd to 25th April, 2007. The three-day event, sought to encourage high-level dialogue between US and Indian government officials and private sector representatives on the development of India's aviation sector and the growing relationship between the two nation's industries and governments. Addressing the conference, US Federal Aviation Authority (FAA) chief Marion C Blakey said there was great potential for a bilateral aviation safety agreement (BASA) and emphasised that though the formal negotiations and signing may take several years, the process of building mutual confidence in our respective certification processes and technical expertise is something that can and should start today.

Apart from the government and trade officials, the summit was attended by leading American aviation firms. The US India Business Council (USIBC) chairman's circle members, Federal Express, Boeing, General Electric, Northrop Grumman, United Technologies, Pratt & Whitney, Lockheed Martin, Honeywell, Continental Airlines were represented by their respective senior executives. "The civil aviation industry in India is a dynamic multi-billion dollar opportunity for 'American Companies', said Ron Somers, president, US-India Business Council, "and this boom is creating new jobs and spurring the development of enhanced infrastructure in India."

"USTDA is focusing significant attention on India's aviation sector because we are interested in exploring ways to help our aviation systems grow together in mutually beneficial ways," said USTDA deputy director Leocadia I Zak. "Working in partnership with each other, we can achieve results that will shape the future and strengthen our respective systems." The extraordinary growth of India's economy has placed increased demands on the nation's aviation infrastructure to accommodate rising passenger and cargo volumes. As a result, India is facing enormous infrastructure development challenges as it strives to further enhance air service quality, airport efficiency, flight security, and air-space management.

Recognising the potential for further cooperation between the United States and India in the aviation sector, USTDA initiated a Memorandum of Understanding (MOU) with the ministry of civil aviation, (MOCA), Government of India at the summit to establish the US - India Aviation Cooperation Program (ACP). The MOU was initiated by Zak and MOCA joint secretary R K Singh, on behalf of the US and Indian governments, respectively, in a ceremony following the opening plenary.

The ACP consists of a public-private partnership between USTDA, the FAA and many US aviation companies that will serve as a mechanism through which Indian aviation sector officials can work with US civil aviation representatives to highlight specific areas for bilateral technical cooperation. Initially, the ACP is expected to focus on activities that support air traffic/air space management enhancements and the challenge of rapidly increasing aviation traffic in India. Specific plans for upgrading the aviation sector are outlined in India's Policy on Airport Infrastructure, in which MOCA states that the establishment of a technologically advanced and systematically reliable air traffic control system is a key priority. Other objectives include expanding airport facilities, installing airport security and monitoring systems, establishing an information technology network to synchronise airport operations, and enforcing airworthiness certification and regulatory systems. To promote a discussion between representatives of the US and Indian aviation sectors regarding industry growth opportunities and challenges, the summit included sessions on air traffic management and airspace utilisation, and the promotion of commercial collaboration in the development of new airborne systems.

The US - India Aviation Partnership Summit took place in cooperation with the Airports Authority of India (AAI), the Directorate General of Civil Aviation (DGCA), the US Departments of State and Commerce, the US Commercial Service, and the Confederation of Indian Industries (CII).

Reality check: Getting the house in order

Though the aviation sector of India is flying high, fortunately India's leaders and decision makers have their feet firmly on the ground. The civil aviation minister agreed that though on one side the opportunities are big in this sunrise sector, where the principles of an open economy will be followed, the other side is the bitter reality of poor infrastructure which is an issue of concern. But he also added that the government is working hard towards getting the systems in place and hence a partnership summit of such nature will only help improve the situation. "We can learn from other countries and apply their systems, practices and expertise in such a way that can enhance and strengthen the Indian aviation scenario and upgrade it to a world class standard," he said.

The modernisation of the Mumbai and New Delhi airports on the public-private partnership model is a positive sign and set towards India's progressive aviation approach. The minister further added that the policies will surely evolve as per requirements in order to bring about positive changes and increase connectivity in a meaningful way. Added Patel, "The government plans on relaxing the FDI norms and there are plans that it may enhance the 49 per cent FDI limit in areas such as helicopter services, sea-planes and non-scheduled operations."

Growth and safety: Siamese twins

The first session on the summit emphasised on the role and importance of balancing aviation safety and growth. They both go hand in hand and cannot be separated from each other. Both evolve and mature in order to meet international standards. Moderated by Robert Francis II, former vice chairman US National Transport Safety Board, the session had eminent speakers, like Nick Sabatini, associate administrator for aviation safety, FAA, Kanu Gohain, director general, DGCA, Vivek Lall, managing director, Boeing India, Dr Agam N Sinha, senior vice president and general manager, The Mitre Corporation and Saroj K Datta, executive director, Jet Airways (India). Said Datta, "Aviation and economic growth are closely related and the cascading impact is much more pronounced in the airline industry. With expected sustained long term growth of the Indian economy, air travel market in India will continue to grow to realise its full potential. But for growth to be real one has to work on the following: Permission for private carriers to fly to international destinations, increase of Foreign Direct Investment (FDI) limit to 49 per cent (investment by foreign airlines is not permitted), initiation of measures to improve aviation infrastructure, quick implementation of modernisation of airports in Mumbai and New Delhi, development of greenfield airports, modernisation of 35 other airports and permission to hedge fuel prices for uplift at international destinations.

Nick Sabatini mentioned that the four pillars of a safety management system are, 1) Policy 2)Safety risk management and design assessment, 3) Safety assurance and performance assessment and 4) Safety promotion. Vivek Lall, felt that to bring in the balance, cooperation between industry (manufacturers, airlines, IATA) and the government is vital. He also felt that recently, the industry's accident rate has improved considerably and the global nature of the aviation industry makes it impossible to put borders around safety issues.

Modernising strategies for airports (domestic and international)

This session highlighted the strategies and work flow methods of few airports both in the US and India. Presentations were made on the Mumbai, New Delhi and Cochin international airports about the systems and structures and how these airports operate.

Rudy Vercelli, COO, Mumbai International Airport said that the Mumbai airport is surely a challenge in itself and all we are trying to do now is maneouver around the infrastructure. Being the largest international airport in India and with 30 per cent of the total traffic, it needs to improve on infrastructure, passenger traffic handling and maintaining service standards.To cope with the increasing air traffic, the government has finally agreed on establishing a second airport at Navi Mumbai.

Similary the Delhi airport is also on its way to a major revamp and will accommodate another terminal to cater to the increasing passenger loads. This new model is going to be tried out for recovery of charges from different sources like shopping malls and other such businesses which will account to non air collections, said Pradeep Paniker, head strategy planning group, Delhi International Airport.

Cochin International Airport (CIAL) is another feather in the cap when it comes to airports in India. The airport is the first greenfield airport in India. It is a sponsored project built on the public-private-partnership model and has over 10,000 shareholders from different countries. "The airport has been built at the lowest budget ever and because of this we are now planning to specialise in low budget airport building," said S Bharath, managing director, CIAL. "We are also being approached by many different countries for the same," he revealed.

He informed that they were also developing a new model for recovering revenue through non-aviation services like development of IT parks, entertainment parks, golf courses, hotels and townships.

D Kirk Shaffer, talked about the FAA Airport Technology Research and Development, which touched upon the following: 1) Airport planning and design, 2) New large aircraft, 3) Advanced airport pavement designs, 4) Runway surface operations, 5) Airport wildlife hazards abatement 6) Aircraft rescue and fire fighting and 7) Visual guidance and runway incursion reduction.

Air traffic management: Systems, opportunities and challenges

This was probably one of the most talked about topics of the summit, especially keeping in view the Indian aviation scenario where air traffic management is the need of the hour and something that needs to be addressed with immediate effect.

The first presentation of the day made by Jeff Williams, manager, RNAV/RNP group, Federal Aviation Administration Air Traffic Organisation, discussed the growing challenges due to increasing air traffic generating demands on air space. As a result this increases the costs of fuel and compelling infrastructure expansion, improvement and maintenance. He identified these as the three major challenges for the future ahead and introduced the performance based navigation (PBN) as a cost effective way at producing measurable improvements in flight safety, system capacity, operational efficiency and new or improved airspace access.

For achieving the effectiveness of the PBN it is necessary for air traffic regulator agencies and stakeholders to work together in order to successfully implement Evolution of Area Navigation (RNAV) and Required Navigation Programme (RNP) capabilities in a country's airspace, he concluded.

Judy Marks, president, Lockheed Martin Transportation and Security Solution also emphasised on strengthening of ties between different agencies in order to cope up with the rapid growth in an attempt to make air travel safe and efficient. Making a next generation commitment she said that the interoperability and global harmonisation and integrated environment are the key focus areas. She also explained about the shared goals of safe separation, easy reliable travel and a secure environment.

Focusing on future initiatives Marks said that the critical expansion and improvement of infrastructure and also decongesting the choke points like the secondary airports and the terminal domains is vital. Modernisation plans of strategic alliances, inter alliances, satellite based system and interoperability using oceanic procedures, automatic surveillance and communications data links will help change the scenario. According to Charles Keegan, director, Future Air Navigation Systems, Raytheon, the infrastructure is undervalued. The challenge being that the implementation of infrastructure is not due to lack of planning or standards but due to financing. He opted for public private partnership as the most viable model of growth. "Its minimised impact on customers and sponsors, operational relationship with the private party and the long term sustainability all make it a preferred solution. Financing is most necessary for ATC modernisation which is necessary for the future," he reiterated.

Giving details of the Indian plans for overcoming traffic management problems, program director - satellite navigation, Indian Space Research Organisation, Dr S V Kibe said modern Indian airspace would soon be operating with the Indian satellite navigation program - GAGAN. The ISNP-GAGAN to be launched in the year 2009 would be managed jointly by ISRO and AAI. This regional satellite navigation system will placed in the L-5 band to facilitate navigation. This SBAS (satellite based augmentation system) will serve all the airports within the area and also support other augmentation techniques like the ground-based and the aircraft-based techniques. It is one of the most concrete efforts of upper airspace management that will link aircrafts to each other without using the ground ATC.

The air traffic management, AAI, general manager, V Somusundaram discussed the challenges faced by air traffic service providers and on how to meet their demands. "Effective airspace management can help bring coordination in civil and military use of airspace. An automatic air traffic management will help optimum usage of airspace with optimum capacity, prove cost effective, provide flexibility in operation and encourage cooperative decision making," he concluded.

Technology is available to enhance capacity, efficiency, safety and security. Exploitation of the strengths of airborne and ground-based systems and the integration of both is the key. Global collaboration would accelerate system modernisation and a comprehensive and committed plan will encourage investment to achieve airport and ATC efficiency and capacity. According to Christopher Benich, director of Aerospace Regulatory Affairs, the key drivers for growth are: capacity enhancing mobility and economic and industry growth; efficiency decreasing environmental impacts; safety ensuring continuous improvement and growth without degradation and security neutralising threats . "There are different objectives for airport surface and airport terminal area operations and both can be achieved by using technology which will enable solutions across all domains, optimise functional allocation and increase global harmonisation. All these well defined technology based plans will reduce investment risk," he said.

Also addressing the need of traffic flow management and metering, David Rhodes., director, Advanced Air Traffic Solutions, Civil Group, Computer Sciences Corporation said that an effective system will help keep traffic moving securely and efficiently powered by automated strategies overcoming severe weather and congestion. "Efficiency can only be achieved by balancing customer needs with responsibilities and development of technology minimising ill effects on environment", he stated.

The two enabling technologies for traffic flow management (TFM) and for metering, Traffic Management Advisor (TMA) helps smooth air traffic flow by collaborative decision making and decision support and execution tool to help optimise flow into capacity constrained areas using time based metering, spacing and sequencing respectively.

The two technologies help in maximising throughput, minimising delay, efficient use of capacity and fuel, enhancing safety, reducing pollution, making reliable schedules and predicting block times.

Aviation project development

Looking at aviation project development through maximising non aeronautical revenue development at airports saw a strong interest from the audiences. Michael A Hodges, MAI, president, Airport Business Solutions presented the importance of these revenues as they reduce costs to airlines. The opportunities helping make such revenues could be the public private partnerships, non essential property development and internal service providers. Golf courses, driving ranges, commercial and retail developments, industrial parks, hotels and automobile dealerships are examples of such properties that help create revenue and reduce airline costs. Also providing financing options was Jessica Farmer, senior project officer, Export-Import Bank of the US who gave details on structured finance and project-based finance.

Mallya magic: Saying it as it is

In his keynote address, Vijay Mallya, CEO, Kingfisher Airlines stated that the increasing purchasing power, exposure, aspirations and willingness to spend is making the Indian consumer upgrade to better things in life. He said that the 350 million strong middle class anticipated to increase to 400 million in the next three years is posing a difficult challenge for the policy makers and infrastructure developers.

The policies of the government will have to under go a revamp to cater to this boom. He highlighted the fact that government policies with regards to permitting domestic carriers to fly international is completely lopsided. "Today if an airline can fly Mumbai-Chennai, why can't it fly Mumbai-Colombo, keeping all other conditions the same," he questioned.

Airline management and operations in India

On the concluding day, there was a meeting of leading names from the Indian airline business, namely V Thulasidas, chairman and managing director, Air-India, (who also moderated the session on airline management and operations), Captain Gopinath, chairman and managing director, Air Deccan, Bruce Ashby, CEO, Indigo Airlines and R K Singh, joint secretary, ministry of civil aviation amongst others.

Speaking on the Air India and Indian merger, Thulasidas stated that the merger is a very sensible act as there is no point operating separately when both the companies are ultimately owned by one owner. "The merger will also make us stronger to face competition better. The merger will result in a large combined fleet of about 115 - 120 aircrafts. In the coming three years 64 aircrafts will be inducted making us the largest airline in Asia ensuring wider network and higher service quality," he further added. He also mentioned that he has put into force a committee to study the need to order for more aircrafts as he feels there will definitely be a demand for more in the future. Talks are also on for joining one of the global alliances resulting in seamless transfer to any place in the world. This merger is the most effective way to tap a market with 40 per cent growth figures. The launch of the new airline will happen in due course, he announced.

The challenges of capacity vs demand, full service vs low cost, sustainable needs and government intervention were some of the topics that were discussed by Singh, joint director, ministry of civil aviation. The legacy airlines have enough capacity while the new airlines are inducting fresh capacity. The trunk routes will get choked if more capacity is added, therefore new or regional routes should be used to divert traffic but in the long run even those will suffer from inadequate infrastructure, he opined.

He raised a very important question of how are low cost airlines called low cost when they pay the same cost for leasing of aircraft, airport charges, navigation charges and so on. This unfair plan has resulted in consolidation or mergers which seem necessary for survival. This trend is here to stay with more mergers stabilising the yields, introduction of new pair cities and regional airlines playing a big role.

Shifting the importance to engine manufacturing, Pratt and Whitney, senior vice president and general manager James Keenan said that in this growing market the development of MRO environment is important as it is a major driver of airline cost. Reducing green house emissions is one of the moral responsibilities and the challenges that would come in India's way in achieving this will be the regulatory burdens and bad infrastructure.

The transition period is now, said Bruce Ashby, CEO, Indigo Airlines. Considering the huge demand for air travel, the need for better infrastructure has gained momentum. The initiator of the low cost airline trend, Captain Gopinath said that as the new India is emerging new things are happening. Right now the country is on the rebound, it is a place of all possibilities. With markets opening and allowing deeper penetration it is the right time to connect the smallest of the cities with the major metros. Huge need for multiple airports in cities and speedy actions facilitated by the government will help take control over the market, he added. Speaking on the next generation air transportation system, Nick Sabatini, associate administrator for aviation safety, FAA said that moving to satellite and internet based systems will not only be safe but also be dependable. It will help achieve efficiency, safety, security and flexibility in operation.

Aviation training

Moving to the most basic and essential contributors to safe, secure and reliable aviation, the session on the need for aviation training practices saw speakers from major aviation training institutes like the Indira Gandhi Rashtriya Udaan Academy, Delta Connection Academy and India Airlines academy.

With the aviation industry growing rapidly it needs more and more qualified pilots. India needs about 4500-500 pilots in the next five years, said air vice marshal Malahan, director, Indira Gandhi Rashtriya Udaan Academy. In order to meet this demand even more flying clubs and aviation training schools would be needed.

Also learning how to handle risk is one of the key areas of expertise for the pilots. Risk management is training in all aspects of aviation including air traffic control, maintenance and operations. It is about managing the safety resources to minimise the risk said Robert Francis, safety consultant, the Washington group.

The central training establishment of the India Airlines Academy has successfully trained many pilots, said Ron Nagar of Indian Airlines. The international major, Delta Airlines also informed about its Delta Connection Academy for aviation training. Captain Gary Beck, president Delta Connection Academy informed that the institute which is a subsidiary of Delta Airlines now has a fleet of over 100 aircraft, 200 flight instructors, 1.7 million hours of fatality free flights and has issued 4000 pilot licenses per annum.

The conference ended with a few general issues of aviation security that emphasised on creating a layered approach to security covering passenger security, bus parking, roadway security, behaviour pattern recognition, inspections, baggage screening, aircraft security and ramp security measures. The topic of air cargo development and infrastructure challenges was also touched upon at the summit.

(Round-up by Anupama Sushil, Jyoti Koul and Reema Sisodia)