Indian Civil Aviation : News , Updates & Discussions

RISING SUN

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Cabinet gives nod for leasing out Thiruvananthapuram, Jaipur, Guwahati airports through PPP
The Union Cabinet has approved the proposal for leasing out Jaipur, Guwahati and Thiruvanathapuram airports of the Airports Authority of India (AAI) through Public-Private Partnership, Union Minister Prakash Javadekar announced on Wednesday.

“This is not a permanent move, it has been leased out for 50 years. The revenue received through this model will be utilised by the AAI to develop airports in small cities. Secondly, passengers will get better facilities,” Javadekar said while briefing the media on the Cabinet meeting, chaired by Prime Minister Narendra Modi.

The latest announcement comes a year after the Cabinet had similarly cleared the civil aviation ministry’s proposal to lease out Ahmedabad, Lucknow and Mangaluru airports through PPP to the Adani group for a period of 50 years. It was the second big airport privatisation round after Delhi and Mumbai were given to private companies GMR and GVK, respectively.

In February last year, the Adani group was selected to operate the three airports, in addition to Jaipur, Guwahati and Thiruvananthapuram, after having bid aggressively.

As per the lease terms of the PPP agreement, Adani group is responsible for operations and management of the existing airport assets as well as for designing, engineering, financing, construction and development of the additional air-side, terminal, city-side and land-side infrastructure for the airport.

The government had invited bids from private players to operate these airports for 50 years on a PPP basis. The AAI adopted the per-passenger fee model this time, which is a modification of the revenue-sharing model that was used earlier in the privatisation of airports such as Delhi, Mumbai, Bangalore and Hyderabad.

Under the per-passenger fee model, the airport operator needs to pay fixed charges per passenger on a monthly basis to AAI. For instance, if 1 lakh passengers use a particular airport in a year, the operator pays the charge multiplied by the number of passengers for the entire year to AAI. Charges are paid on a monthly basis. This provides an incentive for the airport operator to grow revenue as there is no sharing while AAI benefits from the growth in passengers.

National Recruitment Agency for central govt jobs
Among other major decisions, the Cabinet gave its nod to set up a National Recruitment Agency (NRA) for conducting a Common Eligibility Test (CET) for central government jobs.

Explaining the rationale behind the decision, Secretary C Chandramouli said that the government recruitment exams used to have different schedules, application processes and fees, leading to malpractices due to infrastructural challenges. The decision to set up the National Recruitment Agency has been taken to eliminate these challenges, he said.

He further said that around 2.5 to 3 crore people appear for over 1.25 lakh central government vacancies in Group B and C every year through IBPS, SSC, and RRB.

Terming the move as a “landmark reform”, Union minister Jitendra Singh said it will lead to ease of selection, ease of job placement and ease of living, especially for those sections of society that are considered disadvantaged. It will also help the poor and women who have to travel long distances for taking exams for various jobs, he said.

The NRA will conduct a CET to screen/shortlist candidates for the Group B and Group C (non-technical) posts. The NRA will have representatives from the Ministry of Railways, the Ministry of Finance/Department of Financial Services, the Staff Selection Commission (SSC), the Railway Recruitment Board (RRB) and the Institute of Banking Personnel Selection (IBPS).

For now, the scores of the common test will be used by three major recruitment agencies, but other agencies would be included over a period of time. In the long run, the CET score could be shared with other recruiting agencies in the Central government, state governments/Union Territories, Public Sector Undertakings and Private Sector, Singh said. This, he said, would help them save costs and time spent on recruitment.

At present, candidates seeking government jobs have to appear for separate examinations conducted by multiple recruiting agencies for various posts even though they have similar eligibility conditions. The candidates thus end up paying fee to multiple recruiting agencies and also have to travel long distances for appearing in these exams. Singh said the initial plan is to set up 1,000 exam centres across the country for conduction this common test. There will be at least one exam centre in each district and no candidate will now have to travel out of their district for taking this common exam, he said.

Fair and remunerative price of sugarcane
The Cabinet also approved the fair and remunerative price (FRP) of sugarcane payable by sugar mills for 2020-21 season (October-September) on the recommendations of the Commission for Agricultural Costs and Prices (CACP). The FRP of sugarcane for 2020-21 sugar season has been determined at Rs 285 per quintal for a basic recovery rate of 10 per cent. The government said the move is expected to give relief to 1 crore cane farmers.

Working capital norm relaxed for discoms
Besides, it approved a proposal to relax working capital limit norm for discoms under the Ujwal DISCOM Assurance Yojana (UDAY) to get loans as part of the Rs 90,000 crore liquidity infusion scheme.

After the Cabinet meeting, Javadekar said, “Power sector has a problem. There is a slump in power consumption. The bills are not being collected by them. PFC and REC have been allowed to give loans above the limit more the 25 per cent working capital limit. This will increase liquidity of the state discoms”.

“The working capital limit is 25 per cent of last year’s revenue. Now the limit is relaxed,” he further said.

Finance Minister Nirmala Sitharaman had in May announced the Rs 90,000 crore liquidity infusion into cash-strapped discoms, facing demand slump due to the lockdown to contain COVID-19.
 

RISING SUN

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Adani Group to acquire 74% stake in Mumbai International Airport
Gautam Adani-led Adani Group is set to acquire a 74 per cent stake in Mumbai International Airport (MIAL), which operates the country’s second-largest airport, with the current operator settling its disputes with its minority partner and exiting the venture.

With six airports already under its belt, this will make the group the largest private airport operator after GMR Group, which operates Delhi and Hyderabad airports.

The acquisition will also give the Adanis ownership of the upcoming Navi Mumbai airport, in which MIAL holds 74 per cent.
 

RISING SUN

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Adani Group to acquire 74% stake in Mumbai International Airport
Gautam Adani-led Adani Group is set to acquire a 74 per cent stake in Mumbai International Airport (MIAL), which operates the country’s second-largest airport, with the current operator settling its disputes with its minority partner and exiting the venture.

With six airports already under its belt, this will make the group the largest private airport operator after GMR Group, which operates Delhi and Hyderabad airports.

The acquisition will also give the Adanis ownership of the upcoming Navi Mumbai airport, in which MIAL holds 74 per cent.
 

Ankit Kumar

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Nov 30, 2017
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Indigo is looking to sell is turboprops or lease them outside India. And has also put a pause on their deliveries.

Meanwhile has requested Airbus to focus on delivering A321s more than the A320s.

Air Asia India has dropped a leasing program of unknown number of A330s to start international operations.

Go Air is making cuts in older A320 fleet but has as of now not cancelled or shown any intent of cancelling on their neo order.

Spice Jet too has put a pause on its turboprops purchase and will possibly even cut short it's MAX order and turn Airbus. Already it has been leasing A320 , A330 and A340 aircrafts for its operations now.

All in all the domestic circuit of Udaan is in tatters and with impending Air India Sale , the only small oppertunity for growth is snapping up foreign routes and that's where the companies are focusing.

Only Tata is showing interst in Air India, and if that happens Tata may give up its share either in Vistara or Air Asia India or both.
 

Gautam

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Feb 16, 2019
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Adani Group ready for dominance in aviation

Updated: 24 Aug 2020, 10:39 AM IST
By Tanya Thomas

Adani Enterprises is set to become the largest private sector airport operator
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Photo: Adani Enterprises Ltd (AEL) has acquired 74% stakes of Mumbai's Chhatrapati Shivaji Maharaj International Airport. AEL will also take control of the airports in Ahmedabad, Lucknow, Mangaluru, Jaipur, Thiruvananthapuram and Guwahati.

MUMBAI
: Adani Enterprises Ltd (AEL) is set to become India’s largest private airport operator, marking a step forward in its ambitious plan to establish a dominating presence in the civil aviation sector as it has in its current businesses of ports and energy.

The Adani Group flagship will become the largest operator of airports other than state-run Airports Authority of India (AAI), which runs most of the airports, with the Union cabinet approving the transfer of six airports on 50-year leases to AEL. The company will take control of the airports in Ahmedabad, Lucknow, Mangaluru, Jaipur, Thiruvananthapuram, and Guwahati. These will be leased for operation, management, and development in a public-private partnership model. AEL won the contracts after offering to share the highest revenue-per-passenger with AAI during a bidding process that concluded in February 2019.

AEL’s plans have faced headwinds with the economic disruptions caused by COVID-19, especially in the civil aviation sector. Passenger demand for air travel will contract by 49% this year for domestic airlines because of the pandemic, global airlines body International Air Transport Association (IATA) had said in July. The Adani Group is also facing opposition from the Kerala government over the Thiruvananthapuram airport.

Adani has sought from the government time till February 2021 for the official handover of the Ahmedabad, Lucknow, and Mangaluru airports citing the pandemic. AEL is thus likely to take charge of the second batch of three airports later.

In its FY20 annual report, AEL gave a glimpse of its ambition to be the largest private airport developer in the country, breaking the duopoly of the GMR and GVK business groups. The report lists its aim for the airports division as developing world-class infrastructure at airports, both at airside and landside, enhancing the passenger experience, creating entertainment destinations (aerotropolis, airport village, hotels, and malls), increasing domestic airline connectivity to new and under-served destinations, and increasing flights to long-haul destinations in the West and also to South-East Asia.

For an airport operator, the major chunk of revenue comes from the captive entertainment destinations such as an aerotropolis, hotels and shopping malls. The revenue streams are typically split between aeronautical revenues (land fees, user development fees, cargo and ground handling, parking and housing fees and aircraft fuelling) and non-aeronautical revenues (duty-free shops, retail licences, food and beverage, advertising, space rentals, car parking, and development rights on land adjacent to the airport).

The six airports that AEL has won have a current non-aero spend of ₹80 per passenger while the largest of India’s privatized airports—Delhi, Mumbai, Bengaluru and Hyderabad—have a non-aero spend of ₹200-300 per passenger, CLSA said in a 2019 report. The potential to double or triple this revenue stream, along with the 227 acres of city-side land available to AEL for development as the concessionaire, is considerable.

In a February report, property consultant Knight Frank India estimated that India’s airport retail market will grow to $9.3 billion by 2030 from $1.4 billion in 2019. The real estate opportunity for airport operators in India is projected to be $1.6 billion by 2030. In case of key markets such as Mumbai and Delhi, airport retail developments garner revenue of 2.4 times and 2 times that of most successful malls in cities.

That AEL’s focus would be on maximising non-aeronautical revenue streams was clear from its appointment of Ben Zandi as chief executive officer of its airports division. Zandi previously headed the North American business for German airport developer Fraport AG and has decades of experience in hospitality and non-aeronautical services.

 

RISING SUN

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Hardeep Singh Puri: Expect bulk of air traffic back by Diwali
Much of the pre-Covid domestic air passenger traffic could be restored by Diwali, Minister of State for Civil Aviation (Independent Charge) Hardeep Singh Puri said on Monday.

The Centre will allow more flights from locations such as Mumbai and Kolkata, which have had restricted operations so far, Puri said.

“The figure (of domestic passengers) yesterday was 98,800, so we have already reached 33% of pre-Covid numbers. We are increasing domestic passengers at the rate of 5,000 a week. With Mumbai hopefully having Covid numbers under control, the graph stable and coming down, I’m hoping that after the Ganesh Chaturthi celebrations, we will open up Mumbai more; Bengaluru, Kolkata will be a little less sporadic. We will be looking to touch the 50% mark before too long,” Puri said at an online Idea Exchange event of The Indian Express. (A detailed transcript of the conversation will be published later.)

By Diwali (November 14), “we should be getting a bulk of our civil aviation traffic back in form”, the Minister said.

Operations are currently limited to 100 flights per day at Mumbai airport. Flights to Kolkata from Delhi, Mumbai, Pune, Chennai, Nagpur, and Ahmedabad have been restricted until August 31.

Overall, the Ministry of Civil Aviation has allowed airlines to operate only up to 45% of their pre-Covid capacities. This cap was 35% when flights resumed on May 25.

International flights, Puri said, will depend on the behaviour of the virus. “I cannot anticipate whether countries will allow people from India in, but we have gone ahead and made the best out of a very difficult situation, navigated through turbulence, and today we have air bubbles with the US, Canada, the UK, France, Germany. I have announced 13 more,” he said.

“In our case, we started with a mandatory 14-day quarantine — 7 days’ institutional and 7 days’ self quarantine. Now we have introduced an innovation, if you are carrying a certificate of an RT-PCR test done in the last 96 hours you can go through the green channel. We are opening up these things so that we move towards normalcy.”

Aviation is among the sectors worst impacted by the outbreak of the pandemic and the lockdowns all over the world. Consultancy firm CAPA India has projected losses of $4-4.5 billion for India’s airline industry in 2020-21 (April-March).

However, Puri said that airlines could be saved by resuming operations as quickly as possible, and that the government was “navigating its way forward” on this.

“Different airlines are in different financial positions. There are some which were under strain even prior to Covid. There are others that are a little more comfortable because they are tied to bigger business establishments,” he said.

“My own firmly held view is that the saving of airlines, etc. will come by as quickly as possible resuming operations. We have taken many meetings, we are navigating our way forward.”

Puri spoke about the controversy over the privatisation of Thiruvananthapuram airport. Responding to a question on how the Centre would proceed now that the state had refused to cooperate, the Minister said that if the Kerala government was against privatisation, it should not have participated in the bidding process.

“First they turned around and said they are against privatisation. If they’re against privatisation, they should not have participated in this. They are already running two privatised airports (Kochi and Kannur). Some people have suggested that there is angle of the person who has won the bid. That also does not seem to be right because that economic entity is running a port 20 kilometres from there. So, my short answer is that they have an experience in privatisation, they wanted to participate, they participated, they lost the bid and therefore, we have proceeded,” Puri said.

In the tender process for the privatisation of Thiruvananthapuram airport, Adani Enterprises outbid the Kerala state government entity KSIDC by 19.64%, which resulted in the state becoming ineligible to match the winning bid — an option that it could have exercised if its bid was within 10% of the winning bid.
 

Gautam

Team StratFront
Feb 16, 2019
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Tripura, NE, India
Bhuntar airport on banks of river Beas in Bhuntar, HP. This airport serves Kullu and Manali areas.
Elevation: 1190m
Runway: 1125m

Due to short runway, an aircraft fully packed with passengers cannot land or take off. Recently centre has given its approval to expand the airport. Not sure how they will do that.
EhU4WHbUMAIttcv.jpg
 
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Ankit Kumar

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Nov 30, 2017
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Bhuntar airport on banks of river Beas in Bhuntar, HP. This airport serves Kullu and Manali areas.
Elevation: 1190m
Runway: 1125m

Due to short runway, an aircraft fully packed with passengers cannot land or take off. Recently centre has given its approval to expand the airport. Not sure how they will do that.
View attachment 17687
The UDAAN scheme is going down the drain. Even in expanded form, little use of this.

Indigo is officially moving to sell/lease it's ATR fleet outside India and Spicejet has put an hold on Dash 8. Only the Air India subsidiary is still operating some routes.

Spicejet, Vistara, Air Asia India and Go all are operating on very thin ice. Maybe if Govt sells of Air India successfully and maybe gives some tax benefits to the airlines on fuels....