30 Minute Interview

‘Regional connectivity will lead to the next phase of aviation growth’

Minister for Civil Aviation, Praful Patel, talks about the role aviation has played in taking Indian tourism to the top. By P R Subas Chandran

Praful Patel Minister for Civil Aviation

What has been the role of airlines, in general, in making India a top destination?

Airlines have provided connectivity to places within India, which have till now been outside the aviation map. Besides the increase in the number of airlines has led to more seats and more competition, thereby leading to a fare pricing of air tickets. The affordability of air tickets has changed the general perception that air travel is meant only for the elite few. In the twelve onths ending 31st March 2007, airlines have carried 35 million domestic passengers - a 40 per cent increase, year-on-year, and 22.4 million international passengers - a growth of 15.1 per cent. In fact domestic air traffic has almost doubled in the space of three years. The boom in aviation has also attracted several new entrants and the options available to the traveller is much more today, thus making India a top destination.

How do you think airlines could play a vital role in the future? What more needs to be done by individual airlines in order to take India to the top?

The airlines should now move towards strengthening themselves and connecting more regions. Air travel in India has been historically Delhi and Mumbai centric. However, today there is a shift and regional and intra-regional connectivity of tier II and tier III cities will lead to the next phase in the growth of the airlines. Airlines also should gear themselves to meet international standards by strictly adhering to all the norms set by the government.

The costs of flying have drastically reduced, but with ATF charges still being high, what is the strategy being worked out so that business is smooth for all in the business, as well as passengers flying?

The Ministry of Civil Aviation will continue to work with state and central government departments to reduce taxation on aviation turbine fuel, which is currently a significant impost on carriers. The ministry has been taking it up with the oil PSUs to find out ways to bring down the ATF costs. The ministry is also working with the PCRA to optimise the consumption of ATF by aircraft. I will soon be having a meeting with the minister for petroleum to explore possibilities of reducing the ATF price.

What measures are being undertaken to negate any infrastructure bottlenecks at the airports?

The rapid growth in air traffic has placed pressure on airport infrastructure, however that has been the model the ministry has adapted. It has let the traffic grow so that the pressure would be on developing the airport infrastructure at the earliest. A number of steps have already been taken, and there is a plan to invest $ 9 billion by 2010 for modernising airport infrastructure. Mumbai and Delhi airports are being upgraded and modernised by JV companies with 74 percent private participation, and the stage I of completion for both are scheduled for 2009-10. The Chennai and Kolkata airports, meanwhile, are being upgraded by the AAI. Besides that, two greenfield airports at Bangalore and Hyderabad are being built by the PPP approach and are due for completion in March 2008.

The Navi Mumbai Airport, which has received the approval of the government, will be the third greenfield airport. Other such greenfield airports are planned at Greater Noida, Goa, Pune, Ahmedabad, Hassan, Gulbarga, Halwara, Pakyong (Sikkim), Cheithu (Kohima) and Itanagar. 35 non-metro airports across the country are also to be modernised in the next 3-5 years, at a cost of approximately $1.2 billion. Besides the government is encouraging the development of private airports particularly for cargo and logistics operations, and a policy for the same will soon be in place. Various measures are also being taken to upgrade or augment the CNS/ATM infrastructure to enhance the airspace capacity, in order to deal with sustained growth efficiently and safely.

According to you, which major policy decisions can help the growth of the aviation sector in the country?

The policies of the present government to open up the skies, to help in consolidation of airlines, to increase FDI limits in a number of non-scheduled and ancillary sectors, to upgrade and set up more flying training institutes, to liberalise air services, to upgrade modernise and build airport infrastructure, to augment air traffic management infrastructure, to bring in an Airport Economic Regulation and several other forward looking policies have helped in the growth of the aviation sector.