Aviation Challenges Will Be Overcome: Ajit Singh

With dark clouds still looming large on the aviation sector, India Aviation 2012 got off to a steady start at the Begumpet airport in Hyderabad. Setting the tone for a ‘bright future’ in the long term, the Civil Aviation Minister, Ajit Singh said that the growing interest in the flagship aviation event was a reflection that India was fast becoming an aviation hub.

Inaugurating India Aviation 2012, Singh said, ‘The skies are not expected to clear any time soon and 2012 could prove to be equally challenging.” The global economy faced rough weather in 2011 with rising fuel costs, European debt crisis, etc. European airlines are going to be hit the hardest in 2012 and Asia-Pacific (APAC), specifically Indian and Chinese markets, would provide the boost. APAC would account for two-third of the profit forecast for 2012.

CENTRE OF GRAVITY - MOVING EAST. Singh pointed out that the aviation centre of gravity was moving eastward. By 2015, Asia-Pacific region would account for 37 per cent of the passenger traffic, while traffic associated with Europe and North America will fall to 29 per cent. The global aircraft fleet would double by 2030 and APAC would account for about a third of all new aircraft deliveries.

INDIAN STORY. India, he said, was uniquely placed to offer enormous opportunities and potential for aviation companies worldwide to collaborate and expand their presence in the region. In the last decade, India has made tremendous strides in aviation with traffic carried by domestic airlines growing nearly six-fold from 13 million to around 60 million in 2011.

The domestic passenger growth market is expected to grow at the rate of 9 to 10 per cent in the coming years. By 2020, India would be among the top three markets with about 420 million passengers as against 140 million in 2010. Indian airspace will see nearly 3.2 million aircraft movements including over-flying, etc.

GOVERNMENT INITIATIVES. The government, he stated, was committed for the development of the sector and was introducing several policies and regulations to encourage private sector participation and investments. “Our government has been expressing itself forcefully in the infrastructure area both on the ground and in the air. The lack of infrastructure with adequate capacity at airport and ATM as against increasing growth can act as constraints for expansion. A large number of Greenfield and modernisation projects in airport sector are under development on public-private-partnership model across the country to develop facilities conforming to international standards and operational performance.”

The T3 terminal at Delhi had put India on the world aviation map and it has been ranked 2nd in the 25-40 million passengers per annum category by the Airports Council International for 2011. The government was allowing 100 per cent foreign direct investment (FDI) in Greenfield airports under the automatic route. “An appropriate economic regulatory framework for future airport is also being worked out to attract investment and ensure their viability.”

AIR CARGO PROMOTION POLICY. The cargo handled at Indian airports witnessed a CAGR of 10.9 per cent in the last five years, with international cargo accounting for two-thirds. The Civil Aviation Ministry is formulating an Air Cargo Promotion policy which will be discussed with the industry.

The Airports Authority of India is gearing up to meet the challenges of rapid growth in aircraft movements. The Future Indian Navigation System Master Plan includes significant investment in modernisation of communication navigation surveillance, air traffic managements and meteorological equipment, enhancing manpower and training infrastructure and harmonisation with global initiatives and regional air navigation plans.

MRO OPPORTUNITY. With continuing growth in the sector, India offers long-term prospects for MRO business, though presently it is in nascent stage. India’s engineering workforce, R&D expertise and its strategic location make it a potential global hub for both manufacturing and MRO. An MRO facility in partnership with Malaysian Aerospace Engineering, a subsidiary of Malaysian Airlines System, has been set up at the Rajiv Gandhi International Airport at Hyderabad and Air India along with Boeing was setting up in Nagpur. Air India will also set up an MRO subsidiary soon. Airbus is also expected to make investment in MRO.

The opening up of Indian aerospace manufacturing to the private sector, he said, had led to significant investments by manufacturers of hightech precision products to serve the aeronautical requirements of the industry. Exports of aerospace products, particularly components, from India have seen dramatic growth in the past couple of years. Tata Group’s joint venture with AgustaWestland for assembling helicopters at a Greenfield facility in Hyderabad and Mahindra Aerospace’s acquisition of Aerostaff Australia and Gippsland Aeronautics are recent landmark deals. “Our Ministry is working upon a framework to modernise regulatory work for aerospace sector including its promotion. Bilateral Aviation Safety Agreement (BASA) with FAA, USA will boost export of aeronautic products.”

AVIATION UNIVERSITY. To bridge the shortage of skilled personnel in aviation sector, the government proposed to set up a full-fledged aviation university which would enhance the supply of trained pilots and other skilled personnel. “We are keen to set up world class training and education infrastructure in the country. Several such initiatives are underway and include efforts by CAE Canada, CAPA, etc. The CAE Global Flying Training Institute at Gondia and CAE Simulator Training facilities at Bangalore are excellent examples of such endeavours.”

CHALLENGES TO BE OVERCOME. The current decade posed several challenges, Singh said and added, “We will handle these challenges by cooperation with the entire aviation sector. The civil aviation sector in India will see emergence of several new institutions and robust regulatory framework to address growing challenges of safety, capacity in infrastructure, efficiency, viability of the sector and providing skilled human resources including education and R&D.”

The Union Minister for Petroleum and Natural Gas, Jaipal Reddy said as the aviation sector offered tremendous opportunity, the sector needed special attention. The needs of the burgeoning middle class had to be addressed. The Andhra Pradesh Chief Minister, Kiran Kumar Reddy, mentioned how privatisation of various sectors had opened up the economy and benefited larger sections of the people. The airline sector has to work towards making air tickets cheaper as to facilitate increased air travel. Ambassador Peter Burleigh, Charge d’Affaires, US Mission in India, said “we are optimistic about the Indian economy and we want to be part of the ongoing expansion.” The US is keen on cooperating in various fields such aviation safety, technology upgradation, training etc.

Elisabeth Dall, Head of International Cooperation, DGAC, France, talked about the dynamic cooperation between the two countries in various sectors and highlighted the offerings from France in the areas of air safety, air navigation, airport infrastructure, etc. “We all believe in the future of the Indian aviation market.”

Dr Dinesh Keskar, Chairman, FICCI Civil Aviation Committee and President, Boeing India, in his welcome address welcomed the decisions of the government in allowing foreign direct investment; direct import of aviation turbine fuel, etc.

On the occasion the Ministry of Communications released commemorative postage stamps and coins of centenary celebrations of civil aviation in India. The Civil Aviation Minister also released a coffee table book. The Secretary, Civil Aviation, Dr Nasim Zaidi, thanked the Andhra Pradesh government for leading in reducing duties on ATF to four per cent.