India's Air Passenger Traffic Is Expected to Grow Sixfold to 1.1 Bi
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1 Revue de presse Semaines 52/2018 et 1-23/01/2019 Mumbai: India’s air passenger traffic is expected to grow sixfold to 1.1 billion per year by 2040, according to the Vision 2040 report for the civil aviation industry released on Tuesday at the government-backed Global Aviation Summit 2019. The Indian commercial air fleet is expected to be 2,359 by March 2040, says the report prepared by consultancy firm KPMG and industry body Federation of Indian Chambers of Commerce and Industry. India is also expected to have 190-200 operational airports by 2040, with Delhi and Mumbai having three airports each, it says. India may consider investments of up to $2 billion for low traffic airports, excluding land acquisition costs, the report says. It also recommends that a strong leasing industry for financing of aircraft and maintenance, repair and overhaul, be established in India to prevent domestic airlines from going abroad for the facilities. The Vision 2040 report was prepared in consultation with the government though it was not commissioned by it, said aviation secretary R.N. Choubey. “We didn’t commission the report as we wanted suggestions from the industry," he said. The government will deliberate on the suggestions and take a call on which ones to implement, Choubey said. Aviation minister Suresh Prabhu said the report will address the immediate challenges of the aviation sector. “We are working on getting aircraft financing and maintenance, repair and overhaul (MRO) industry in India, which will also increase jobs in the country," Prabhu said. At present, most airlines go abroad for MRO services and for raising capital to finance aircraft purchases. Four of the five engine issues related to the Pratt and Whitney engines on Airbus 320neo planes have been resolved, while the fifth issue, that of the gearbox, is being addressed, said minister of state for aviation Jayant Sinha. Domestic airlines such as IndiGo (InterGlobe Aviation Ltd) and GoAir have had several flights grounded over the last few months because of glitches in the Pratt and Whitney engine. “The director general of civil aviation is expected to issue further directives regarding this shortly," Sinha said. 2 The Centre also proposed amendments to the draft drone policy, including allowing drones beyond visual line of sight. The amendment also proposes the use of algorithm to pilot drones, and a dedicated drone corridor, besides creating drone ports for landing and taking off. It also bats for 100% foreign direct investment in drone manufacturing. Meanwhile, Qatar Airways’s group chief executive officer Akbar Al Bakr said on the sidelines of the event that the airline is in talks with IndiGo and GoAir for code share opportunities. International Air Transport Association (IATA) expects India to become the third-largest aviation market worldwide in the next decade, it said in a report released at the summit. “The fundamental drivers of air passenger demand, including population and demographics and increasing incomes, are favourable and supportive of ongoing growth over the longer-term," the report said. The aviation industry in India is not yet on a sound financial footing and this remains a work-in- progress for the industry and its key stakeholders, including policymakers, it said. “While the industry has demonstrated resilience in the face of various shocks and disruption, including the global financial crisis and airline exits, financial stability is a key factor for the industry to be able to successfully develop and grow," according to the IATA report. Mint 16/01/2019 Raising concerns over delayed salary payments, a group of Air India pilots has said that financial stress could impact flight safety. The Indian Pilots' Guild, which represents pilots of wide-body planes of Air India, has also told aviation regulator DGCA that the management has continuously used the guise of financial losses to illegally change their service conditions and withhold payment of arrears as well as overtime. "We are already engaged in multiple litigations for our basic rights and service conditions."If even our salaries are now withheld and reduced at the whims and fancies of airline management, it is not 3 humanly possible to keep all this stress away from the cockpit," the guild has said.The guild has around 700 members. In a letter to DGCA chief B S Bhullar, the grouping's general secretary Captain K Jayakumar said that such a prolonged atmosphere of financial uncertainty is not conducive to flight safety. "For more than six months, our wages are not being paid on time. "Our January wages have still not be paid even after half the month is gone and even now nobody can give us a straight answer as to when we can expect payment," the letter dated January 17 said. The pilots have received their December salary. Mint 20/01/2019 With ballooning debt and rising costs, Jet Airways founder and promoter Naresh Goyal is left with few options and little time to save the airline. He can take up an investment offer from Etihad Airways, which owns 24% of Jet Airways, and relinquish control of the airline he started about 25 years ago. Alternatively, Goyal can rush to gather his own funds or watch Jet shut shop like erstwhile rival Kingfisher Airlines did about six years ago. However, he knows it won’t be an easy ride, for the carrier posted three straight quarterly losses of more than ₹1,000 crore each and is saddled with a debt of ₹8,052 crore as of end-September. Goyal may have his own reasons, perhaps valid, to thwart any offer that seeks to invest in his crown jewel, which he started in 1993 after about two decades of sales and marketing work for foreign airlines in India. The offers from Etihad and the Tata group come with riders, the core being the transfer of management control. However, Goyal does not have much time on his hands. Jet Airways has delayed payment of pilot salaries amid a crippling cash crunch caused by rising costs and a bruising fare war. On 31 December, the airline defaulted on interest payments to a consortium of lenders led by the State Bank of India. Analysts say Jet needs to immediately raise at least $250-300 million to pay off lenders and vendors. It would need to raise another $450-500 million by the end of 2020 when some of its overseas debt matures, analysts say. Jet’s predicament echoes the dire scenario of India’s aviation industry. Several airlines mushroomed after the 1990s when the government liberalized the aviation sector. Only a handful have survived. India has been ranked as the fastest-growing aviation market globally and airlines here have ordered planes worth several billions of dollars in the past few years. However, mostly everyone, other than the airlines, seems to be making money. Crisil Ltd, the ratings company, expects Indian airlines to post their steepest loss in a decade this financial year. The airlines will need equity infusion of about ₹35,000 crore over 3-4 years to reduce their debt, rating agency Icra said in November. There are several factors that can be blamed. The weakening of the rupee last year has swollen airline costs as most non-fuel payments, such as aircraft maintenance and lease rentals, are dollar denominated. There is also the high cost of fuel, about double that of Dubai or Kuala Lumpur. The Union government last year cut excise duty on fuel from 14% to 11% but a much-needed move to bring fuel under the ambit of the goods and services tax, something which would have helped lower costs, is yet to happen. 4 The airline industry is traditionally a heavy capex business. For airlines working on wafer-thin margins, any increase in cost acts as a double whammy, especially when they are forced to offer lower fares in an intensely competitive environment. Goyal is now at the crossroads with some tough choices to make, something that can either sustain or shutter Jet Airways. He has to choose whether he wants to give up the driving seat or continue frantic efforts for cash to run India’s second-largest airline by market share. Mint 22/01/2019 After the year's worst spell of fog on Friday morning, at least 600 flights were held up at the Indira Gandhi International Airport. The restrictions on the flight operations during peak hours for Republic Day rehearsals also worsened the scenario. According to air traffic officials, the airlines did not prioritise their flights' departures after the visibility improved which led to every pilot calling the Air Traffic Control for permission to take off. This commotion lasted for around 7-8 hours, disrupting the schedules of the flight departures. According to officials, as cited by Hindustan Times (HT), lack of coordination worsened delays and forced many passengers to wait inside aircraft. Normally, the process to clear backlog involves airlines communicating to airport authorities which of their flights must be sequenced first. “For instance, if five different airlines had 10 flights each to depart and there were only four slots, they were unable to tell us which four will go first. Passengers of all 10 flights were asked to board instead,” an (ATC) official, not authorised to speak to the media, said, as cited by HT. Although most of the airlines are equipped with systems and pilots for handling low visibility using the CAT3B technology, the take-offs and landings of the aircraft are normally suspended when the visibility drops below 75 metre. “The visibility between 5:30 am and 9:30 am was below 75 metre but once it improved, we didn’t receive any sequence and every pilot was calling us, requesting to depart.