Demand for choppers takes off

Mumbai: With the Lok Sabha elections not too far away and Assembly elections in five states lined up over the next 25 days, helicopter operators are seeing a rise in bookings.
SJS Saighal, chairman, Global Vectra Helicorp, says, “We have got bookings from political parties across the board. Three out of our 26 choppers will be used for the elections....”
A pilot says there are already 13 choppers currently flying around Bhopal — all on political rounds. Assembly elections in Madhya Pradesh are scheduled for November 25.
Chopper rentals vary between Rs 70,000 and Rs 1,70,000 per hour, says Ritesh Kakkad, founder of Airnetz Aviation. Election flying nets some of these operators 15-25% more than their usual charges.
An official in a helicopter charter firm says those who book these flights early are often middlemen as political parties try to circumvent the Election Commission’s spending caps. “Some private choppers are also lent to politicians in exchange of favours,” the official adds.
Operators point out that politicians, once aboard the aircraft, often make unreasonable demands to land at places that are out of the flight path and compromise safety. Add the dusty environs typical of election rallies in India, and the life of the chopper engine can get reduced. These, they say, are the reasons for the premium that political flying
nets operators.
12/11/08 Nirmal John/Daily News & Analysis

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Steep agent fee on air tickets from tomorrow

New Delhi: With airlines deciding not to pay travel agents commission on ticket sales, travel agencies have decided to levy a transaction fee of Rs 350 to Rs 500 on domestic tickets sold by them.
For international flights, agents will be levying Rs 2,500 per ticket for economy class; Rs 5,000 for business and Rs 10,000 for each first class ticket to all parts of the world.
"Some issues are yet to be resolved with the airlines because of which we want the move to be deferred. There must also be a remuneration arrangement between us and the airline, and not just between us and the passenger. Agents have not been provided training for the new system. And finally, the public has not been provided any education about this fees. If airlines stop commissions and agents are still not ready to collect the fee, there will be chaos from Saturday," warned TAAI president Rajinder Rai.
However, the loss-making Indian airlines are in no mood to extend the date. For the travelling public that still books tickets via agents, there could be a double whammy in store — they will have to pay a steep fee and also get caught in the crossfire between adamant airlines and unprepared agents. "There is no plan to reduce these charges," said Rai while admitting there could be a "huge turmoil" in the market.
Travel agents point out that a majority of their sale is on credit while they pay airlines within a fixed period. On their part, airlines point an accusing finger at the hefty fee structure proposed by the agents.
31/10/08 Saurabh Sinha/Times of India

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Govt approves Horizontal Aviation Agreement with EU

New Delhi: Government today said it has approved an agreement with the European Union to bring all 26 bilateral air services agreements with member nations in conformity with legal requirement.
"The new arrangement will bring all the existing bilateral air services agreements between EU member states and India in line with the European Commission law at one go, thereby obviating any threat of legal challenge," Finance Minister P Chidambaram told reporters here today.
The Union Cabinet gave an ex-post facto approval last night to the Horizontal Aviation Agreement, signed in Marseilles on September 28 during Prime Minister Manmohan Singh visit to France at the India-EU Summit, he said.
The landmark pact on civil aviation would work like an 'open skies' agreement, encouraging more airlines to offer services between the continents.
Nearly 5.7 million passengers travelled between India and the EU in 2007, with India ranking 11th in terms of passenger traffic between the EU and non-EU countries. Over the past three years, passenger traffic on this sector has grown by 75 per cent.
31/10/08 Press Trust of India

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AAI mulls harsh steps to recover airline dues

New Delhi: The Airports Authority of India (AAI) is all set to crack whip on the private and state-owned airlines which have not paid the whopping dues running into over Rs 1,000 crore.
The AAI had set October 24 deadline for the payment of the outstanding dues for all the defaulting airlines. But the non-payment by the airlines has ticked off the AAI, which offers services like landing, parking and route navigation to all the airlines in domestic and international sectors.
“Ideally the airlines must clear its dues with in 15 days and most of them breach this credit limit and it results in colossal dues. Each of the airlines has individually been contacted and told to pay but not much has been done,” the official said.
Among the list of the defaulters the state carrier National Aviation Company of India Ltd (Nacil), which runs Air India, sits right on the top. Nacil has unpaid dues running over Rs 650 crore. Of private airlines, Kingfisher Airways and Jet Airways account for around Rs 255 crore and Rs 36 crore respectively. SpiceJet, Paramount, Indigo and GoAir owe Rs 21 crore, Rs 10 crore, Rs 5 crore and Rs 7.98 respectively.
Sources said that AAI might resort to take harsh steps to recover dues from the airlines. “AAI might have to recover dues from the security deposits of the airlines, but this is no permanent solution,” said the official.
31/10/08 Yogesh Kumar/Daily News & Analysis

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ATF Customs duty may fly at half-mast

New Delhi: In yet another move to keep loss-laden airlines afloat, the government is exploring a proposal to cut the Customs duty on aviation turbine fuel (ATF) to 2.5% from the existing rate of 5%. The move is aimed at making jet fuel cheaper and help the airlines reduce their operating costs that has moved up significantly due to high fuel price.
In the wake of spiralling fuel prices during April-August period, ATF prices shot up, creating huge cost over-run for airlines. Fuel prices have since come down 21% following a drop in crude oil prices. However, even after the dip, the current prices do not augur well for airline companies. Domestic carriers had planned fleet expansion assuming fuel price at Rs 36,000 per kilolitre, but the ATF price hovers at nearly Rs 57,000 per kilolitre.
“We are not in favour of completely doing away the Customs duty as it would cause revenue loss. We are, however, agreeable to cutting down Customs duty by 50% in view of the financial crisis being faced by airlines,” a source in the finance ministry said.
The civil aviation ministry has been demanding to notify ATF in the declared goods category thereby attracting a uniform duty of 4% in lieu of sales tax, which averages around 23%. It had also urged the petroleum ministry to effect a downward revision of the base price of the aviation fuel. Of late, the demand got stronger as airlines started cutting down capacity and laying off staff to reduce losses.
31/10/08Nirbhay Kumar & Deepshikha Sikarwar/Economic Times

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Airlines may not get tax relief on fuel

New Delhi: The sharp fall in crude price might have come as a relief to airlines but could adversely affect one big relief the industry was hoping for — a uniform 4% sales tax on jet fuel, which is much lower than the existing rates.
The aviation ministry has long been requesting the finance ministry to term aviation turbine fuel (ATF) as a declared good so that a uniform sales tax of 4% is levied on it throughout the country. But highly placed government officials said with oil plummeting to a 15-month low now, giving in to this demand may “no longer be warranted”.
“In the past when oil was over $145 a barrel, airlines said they may break even the level of $70. Even if the rupee’s depreciation against the dollar is taken into account, current levels of $55-65 that could fall even further on fears of overall reduction in consumption with the slowdown don’t make a strong case for declaring ATF a declared good. States should take the lead now as a move from our end would be difficult,” said the source.
Moreover, there are legal issues in which amendments to Central VAT and its schedule would be required to do so, something that this government at the fag end of its tenure may be unlikely to do, the official added. However, the finmin may look at providing some relief from custom and excise duties.
Indian airlines are deep in red mainly on account of the fact that ATF prices in India are among the highest in the world because of high base charges and even higher taxes. The problem is compounded as states levy very high sales tax.
30/10/0 Saurabh Sinha/Times of India

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2 pilots die in air crash off Ludhiana

Ludhiana: Just a week after it was cleared for flying, after a seven-year-long grounding, state government official VIP plane, King Air C-90 Beechcraft, crashed at an abandoned industrial unit of Thapar Agro Mill near Jugiana here this morning killing both pilots.
Pilot Dalip Singh Kataria and co-pilot Manjit Singh Khokhar were the only two on board.
The plane, which had taken off from the Chandigarh airbase at 10.50 am, faced landing trouble at Sahnewal airport and crashed around 11.30 am.
According to eyewitnesses, the plane took three rounds of the Sahnewal airbase and in the fourth attempt the aircraft tilted upside down and crashed 5 km away at Jugiana village. The official of the Chandigarh airbase received the last message from the pilots at 11.25 am.
Punjab government civil aviation sources said the aircraft was not being used for some time and had been cleared for flying by the directorate general of civil aviation (DGCA) only last week after major repairs.
The eyewitnesses further said one of the pilots reportedly tried to dive from the plane before it crashed at the factory unit.
Purchased in 1978, this aircraft was for seven years at Chandigarh Hanger after it had crashed landed at the Hisar airbase in 2001.
The forensic team and the teams from the Sahnewal airbase started searching for the crucial remains that could lead them to the exact cause of the crash.
According to the Chief Minister's media advisor Harcharan Bains, the plane was on a mandatory technical check-up flight prior to a VIP trip when it seemed to stall and begin losing height and crashed.
29/10/08 Mohit Khanna and Loveleen Bains/The Tribune

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Grounded for six yrs, Punjab plane crashes on test flight

Jugiana (Ludhiana): A 26-year-old Beechcraft C-90 King plane owned by the Punjab Government crashed here on Wednesday morning killing both its occupants, the pilot and the co-pilot. The pilot saved many lives by steering the aircraft towards an abandoned industrial unit before it crash-landed.
The aircraft, which was on a test flight after remaining grounded for over six years, caught fire soon after it hit the ground.
The charred bodies of Capt Dalip Kataria and Capt Manjit Singh Khokhar were retrieved from the remains of the plane that crashed into the premises of Thapar Agro Mills located in village Jugiana some 20 km from Ludhiana. SSP R K Jaiswal said the aircraft was on a test flight and had flown from Chandigarh at about 10.50 am. “The plane crashed at about 11.30 am and the last communication that the pilot had with the ATC Sahnewal was at about 11.25 am.” It has been learnt that the pilot had been requesting permission to land at the airport and was allowed to do. However, as the plane was about to land at an airstrip it was asked to change to another air strip for which the plane had to make another circuit.
It has been learnt that former chief minister Capt Amarinder Singh had refused to use the plane saying that it was not fit for flying. However, Chief Minister Parkash Singh Badal had ordered repairs of the craft and it was being put to various tests before starting regular flights.
29/10/08 Amrita Chaudhry/Indian Express

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Badal announces grant of Rs. ten lakh each to bereaved families of pilots

Chandigarh: The Punjab government's official plane, C-90 King Air,crashed near Ludhiana this morning,killing both pilots on the spot.
According to Harcharan Bains, Media Advisor to Chief Minister Parkash Singh Badal, the bodies of the two hapless pilots would be cremated with full state honours. The Chief Minister " profoundly regretted" his inability to attend the funeral because of his participation in the 300th Guruta Gaddi functions in Huzur Sahib (Maharashtra).He has however deputed Dr.Upinderjit Kaur, Education and Civil Minister, Punjab, to represent him at the funeral.
Bains said that the Chief Minister has also announced a grant of Rs. ten lakhs to each of the bereaved families.Badal has rushed the Secretary and the Director, Civil Aviation, Vishawjeet Khanna and Gagandeep Singh Brar respectively to the crash site. The Chief Minister has also expressed "deep shock and sorrow" over the tragic demise of the pilots, Dalip. Kataria and Manjit Singh both of whom, he said, were "proud assets of the state."
Bains disclosed that the DGCA, Government of India, has constituted a two-member team to conduct an inquiry into the accident.
30/10/08 PunjabNewsline.com

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Pilot had told sister: condition of the plane so bad

Panchkula : On Diwali night, Capt Khokhar had promised daughters an outing and dinner after he returned from test flight.
It had been just a few months in the new job for Capt Manjit Khokhar, who joined the Punjab Government as a pilot after flying planes in the US for 18 long years.
And the 42-year-old was not happy flying the King Air plane, according to his sister Narender Kaur. “He was not paid his salary for the last month. He also complained that the Punjab government’s plane was not in a good shape. He would say the condition of the plane was so bad that it would certainly crash one day.”
His prediction became a reality and the plane actually crashed near Ludhiana on Wednesday morning, claiming the life of Khokhar and another pilot.
He leaves behind his two minor daughters who live with their mother in Chandigarh — Khokhar and his wife were divorced. “He called me up last night and told me that I should concentrate on my studies and that he would take us for an outing and for dinner once he returns,” said a distraught Niharika, elder of Khokhar’s two daughters. She is a student of Ydavindra Public School, Mohali. Khokhar’s former wife, too, was in a state of shock.
Narender Kaur, with whom Khokhar lived in Sector 12-A here, said he had asked her to pack a packet of dry fruits for his friends. Before leaving for the flight in the morning, he also spoke to his father who always insisted that he should marry again, she added.
Khokhar had returned to the city only on Tuesday afternoon.
30/10/08 Indian Express

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Airlines will stop paying commission to travel agents from Nov 1

Bangalore: The airline industry could see another major upheaval from November 1 when all the airlines will stop paying any commission to the 3,000 travel agents across the country and instead make the agents charge a fee from the customers for every ticket sold.
From November 1, customers will have to pay a flat fee to the travel agents for each ticket they buy which will increase the total amount they pay for a ticket. Airlines till now pay five per cent commission to the travel agents for every ticket purchased by the customers.
Confirming the decision to stop paying commission to the travel agents, a top official with National Aviation Company of India Ltd (NACIL), which runs Air India told Business Line that his company will instead implement the transaction fee model (the fee charged to the customers for every transaction/ ticket) from November 1.
The airline has already sent letters to various agents last week informing them about its decision.
Travel agents belonging to Travel Agents’ Association of India (TAAI) have already accepted the transaction fee model and had even hired Tata Consultancy Services earlier to recommend the fee structure which has now been accepted by the airlines.
However, another travel agents’ body, Travel Agents Federation of India (TAFI) has in a poll conducted among its members recently refused to accept the transaction fee model.
29/10/08 K. Giriprakash/Business Line

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SBI wants collaterals from airlines seeking credit

Bangalore: State Bank of India has insisted that airline companies provide corporate guarantees as a precondition for credit lines.
Top SBI officials said that at least two of the country’s largest private sector airline companies had approached it for credit support.
Currently, only the public sector National Aviation Company, the holding company of Air India, has credit support from the domestic banking sector.
Unlike the public sector, where there was an implicit sovereign guarantee cover and physical asset coverage, private sector had little to offer as collateral, the officials said.
Under current guidelines for borrowers, the prescribed physical asset coverage ratio is 150 per cent of the outstanding credit.
Besides, the bankers said, the airline companies were also not in a position to pledge cash flows.
This was because almost all private sector airline companies largely operate leased fleet. This makes lease financiers the asset owners.
The lessors were entirely cross-border. American International Group subsidiary International Lease Financing Corporation and Ireland-based Ansett Worldwide Aviation Services are among the largest lessors to the large domestic aviation companies – Jet Airways Ltd and Kingfisher.
In most of these lease arrangement, the lessors had the first charge on the aviation companies’ revenues through an escrow accounting mechanism.
Moreover, lease rentals during the last few months have been on the ascent on account of the hardening global interest rates and due to weakening of the rupee against the US dollar.
30/10/08 C. Shivkumar/Business Line

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Indian-American held for threatening to blow up Mumbai-New York flight

Mumbai: An Indian American was held at the Mumbai Airport after he threatened to blow up Air India Mumbai-Paris-Newark Flight A-191 here on Thursday morning, according to an airline spokesman.
The airport security was summoned and the person, an Indian resident of New Jersey was offloaded. The officials have not disclosed his identity yet.
All the passengers on board are safe and were ordered to vacate the aircraft while investigations were conducted.
The flight finally took off at 11 a.m., almost three hours behind schedule, the official said.
30/10/08 IANS/Economic Times

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CAG pulls up CSIR on aircraft programme

New Delhi: In a serious indictment of the Council of Scientific and Industrial Research, the Comptroller and Auditor General of India has questioned the way the apex agency’s Bangalore-based National Aerospace Laboratories (NAL) has gone about its indigenous aircraft development programme.
Noting that the two-seater HANSA aircraft was still being manufactured with imported components as NAL was yet to develop the sub-systems indigenously, and the project on the nine to 14-seat multi-role SARAS aircraft was suffering from time and cost over-runs, the CAG, in a report tabled in Parliament recently, said a detailed audit of the projects showed that the programme was not only not properly planned but was also mismanaged.
In the case of the SARAS project, the CAG has criticised the NAL for procuring engines with a capacity of 850 shift horsepower (SHP), even though engines with a capacity of 1,200 SHP were required as per the rules for airworthy certification by the Directorate General of Civil Aviation, and for failing to procure several critical components such as an auto-pilot system.
It noted that while the expenditure of Rs. 1.8 crore incurred on two projects to develop the auto-pilot system indigenously proved infructuous as the projects were short closed since the NAL was not in a position to provide all the necessary data, the “injudicious” procurement of engines had led to an “avoidable” expenditure of Rs.1.34 crore. In addition, 28 seats purchased at a cost of Rs.80 lakh were yet to be installed pending certification by DGCA, leading to the blockage of the fund for more than five years, it said.
On HANSA, the CAG said that even though one aircraft delivered to Andhra Pradesh Flying Club met with an accident and another flown by the Centre for Air Borne System was forced to land as the propeller got detached, the NAL did not have any documents on investigations on the mishaps conducted either by the Laboratory or the DGCA. This, it noted, indicated that it had no mechanism to monitor the performance of the aircraft supplied by it for possible improvement of design for subsequent aircraft.
Further, it pointed out that as many as seven engines valued at Rs. 64 lakh and five propellers worth Rs. 11 lakh were lying unused because the NAL had no orders for production of the aircraft beyond the 10 originally ordered. It also noted that the NAL had incurred an average manufacturing cost of Rs. 43.3 lakh per aircraft against an estimate of Rs. 5 lakh. This cost also did not count in expenditures on manpower and over-headed charges.
29/10/08 The Hindu

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Low-cost airports the next step

New Delhi: Low-cost airports are the next step for the Indian airport industry which can offer enhanced connectivity across the country and help in rationalising the costs incurred by the airlines and decongesting traffic at regular airports.
Low-cost airports can come as a relief for low-cost carriers, whose financial position has been negatively impacted by aviation fuel prices and operational costs and which currently pay the same charges as full service airlines.
“While maintaining all standards and safety norms, these airports are expected to have no baggage conveyor belts, aerobridges and buses for the passengers. These airports shall further the no-frills experience being offered by the low-cost carriers,” says a study on ‘Indian Airports,’ conducted by KPMG, an audit and advisory body.
Cities that already have an operational runway could get a new low-cost terminal. At Delhi airport, Terminal 1, operated and managed by the Delhi International Airport Limited (DIAL), is expected to be developed as an exclusive terminal for the no-frills carriers by 2010, the study says. Along with the non-operational airports, low-cost airports could be the answer to the challenges faced by the aviation sector in the country.
Taking an optimistic outlook of the aviation industry, the study noted that low-cost carriers, which opened the skies for the average Indian traveller, have underpinned the growth story of aviation. With less than five per cent of the Indian population currently travelling by air, there is a large untapped market, which could continue to fuel growth in the sector.
“Airports in India are future potential areas not just from an aviation perspective but also from a real estate point of view. While this might be a new phenomenon in India, globally, airports have embraced the concept of developing the surrounding commercial areas,” said Rajeev B. Batra, Executive Director of KPMG.
Despite the ongoing slowdown and a dip in passenger growth, the study said that once oil prices stabilised, in the long run the passenger traffic will continue to maintain its momentum.
For airports, an increase in passenger traffic implies an increase in its aeronautical revenues via the charges levied on the airlines and the potential for an increase in the non-aeronautical revenues through the retail segment.
29/10/08 Vinay Kumar/The Hindu

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Does the elephant need a superjumbo?

Mumbai: Since Airbus A380 entered service, the aviation environment has changed dramatically for the worse. Operational costs, led by fuel prices, have multiplied. World aviation is now seeing some of its toughest times yet. To make matters worse, a financial gloom has descended over the world. In India, as yet Kingfisher Airlines’ order for five of these birds remains on schedule — even though the airline has pushed back deliveries of the long-haul A340 aircraft.
Praful Patel, the union civil aviation minister, welcomed the aircraft in Hyderabad and interestingly enough, wished that Air India too will buy some.
John J Leahy, chief operating officer-customers, Airbus, was not one to miss the chance and made a sales pitch to Air India following Patel’s comment. “We think the A380 is the ideal aircraft for a market like India with a huge population,” he said.
But is it? Aviation industry experts say that for the A380 to find more takers here, the market would have to develop a strong hub, on the lines of Dubai or Singapore, where traffic from various parts would come in and get distributed. The challenge, they say, is in making sure that the 500+ seats (in a conservative two/three class configuration — in all-economy, this aircraft can fly up to 852 passengers!) can be filled
Mark Martin, an aviation analyst with consultancy firm KPMG, told DNA Money, “The success of an aircraft like the A380 would depend on the economics and the economy. In India, it is not so much the airport adaptability issues which were talked about earlier as much as the viability in being able to fill a decent number of seats, which is what should dictate the decision for airlines.”
Boeing believes that the future would be more about connecting more destinations, or in aviation parlance, point-to-point.
Airbus, on the other hand, believes in the hub and spoke model, where all traffic will flow through large hubs. Analysts say the potential depends on the way the market develops.
29/10/08 Nirmal John/Daily News & Analysis

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Biz jet makers look to build a BRIC mkt

New Delhi: The times may be tough, but not tough enough to stop big spenders. With America’s boardroom brand equity taking a knocking, its reputation in the corporate jet market has also seen a free fall. Result: major aircraft manufacturers such as Boeing, Airbus, Bell, Bombardier, Hawker Beechcraft , Cessna, Dassault, Embraer Gulfstream and Lockheed are looking at the BRIC Block (Brazil, Russia, India, China), Middle East and South East Asia.
The focus, in the business jet, has turned away from trans-Atlantic to Russia, East Europe and India. There are around 80 business jets in India currently. With pending deliveries and new orders, the number is expected to swell to over 300 by 2010. Major purchasers include the Tata Group, Reliance, ADAG, GVK, GMR, Hinduja Group, Jindal and the Ruias.
Most of the orders comprise 6-9 seater business jets in the price band of $10-30 million.
Until recently America boasted around 70% of the total sales in the business jets market. But things have changed dramatically in the past four years. Now, most of the corporate jet makers are taking a keen interest in China and India which have shown the highest potential in terms of the number of billionaires and deep-pocket corporates.
According to Merrill Lynch and Cap Gemini the population of high networth individual (HNI) with financial assets of over a $1 million grew 23% in India and 20.3% in China. The global business jet market is estimated to generate around $300 billion worth of sales in the next decade.
Take Canadian aerospace major, Bombardier, which is looking to sell 12,900 aircraft in the next 20 years. The company will be selling less than half of these in America and around 12 % in the Asia Pacific region.
Historically, markets other than America account for a minority share of the total business jets orders. However the international orders out of US have increased dramatically and now over 55% of business jet orders are from Europe, which is the most important market, followed by Asia. French luxury business jet maker, Dassault Aviation has already bagged a large order from the India. It is also working with Tata Group, GMR and Air Works to set up service centres for its growing fleet.
"....India is one of the major markets and we will be delivering 12-13 of our luxury jets in 2009, including the Falcon 900 Lx capable of flying Mumbai-London non-stop,” Dassault Aviation vice-president (sales & marketing) Alian Aubry said. The market is also changing for the big boys of the aviation mart. Airbus, one of the largest players in the global aviation industry, is also rethinking its US focus.
27/10/08 Chanchal Pal Chauhan/Economic Times

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Low airfares may attract ‘hits, not clicks’

Mumbai: Over the past week, SpiceJet, GoAir and Jet Airways have announced special fares in a bid to attract passengers. Will passengers bite?
Aviation analysts say this is nothing more than a marketing ploy to get air travel back into the consideration of travellers to whom it had once again become a luxury.
An analyst with a foreign brokerage said, “The perception that air tickets are now expensive is on the rise. Due to inflation, people were also cutting down on travel expenses. The schemes which are being offered are just enough to help airlines get back into the minds of individual travellers. At the same time, there is a realisation that airlines cannot offer tickets way below costs just to increase their market share.”
Sure enough, air travel was down a massive 38% in September, according to figures released by civil aviation authorities.
Marketing gurus say that while these schemes might help temporarily drive traffic towards the airline’s portals, there is an issue of credibility involved. The attention-grabbing Rs 99 fares do not reveal the surcharges and taxes.
They say that this would only help in complicating a situation where airlines’ trust is on the line, and lead to questions of integrity.
27/10/08 Nirmal John/DNA MONEY

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Airlines with no dues look for incentives

New Delhi: Days after oil companies gave a six-month reprieve to defaulting airlines for clearing their dues, other players - who paid on time -have now started talks with them to get some incentive. Last Wednesday, oil companies had given six months' time to clear Rs 2,926-crore dues owed mainly by Jet, Kingfisher and Air India-Indian Airlines combine NACIL.
"Since defaulting airlines have got relief, we have begun talks with oil companies to get some discount for our timely payments. Otherwise it is not fair that the ones who pay on time get nothing. At least the cost of money of getting payment should be deducted," said an airline chief.
The bailout for the big three has led to some heartburn among the other airlines. The six-month reprieve has prevented the closure of some big players as oil companies had threatened to stop supplies from this month-end if dues were not cleared.
Airport Authority of India (AAI) also has dues of Rs 653 crore and Rs 255 crore from the national carrier and Kingfisher, respectively, as on September 30, 2008. Jet is third highest on this list with a figure of Rs 36.63 crore. The combined oil and airport dues of Jet, Kingfisher and NACIL are over Rs 4,400 crore. Smaller players allege that the bailout package is being sought for the benefit of a few biggies, while the aviation ministry points out every airlines will benefit from something like cheaper jet fuel.
27/10/08 Saurabh Sinha/Times of India

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Jet seized from India's Punj Lloyd over alleged duty evasion

New Delhi: The Indian Customs Department has seized an aircraft worth Rs 720 million (US$14.5 million) owned by PUNJ LLOYD AVIATION LTD for alleged evasion of import duty. Punj Lloyd had imported the Gulfstream G-200 aircraft under Non-Schedule Operator Permit Scheme, which entitles 100 per cent duty exemption, but violated norms by using it for private purpose, leading to its seizure, sources said. The Customs Department is now all set to issue a show-cause notice for duty evasion to the tune of Rs 180 million (US$3.6 million). In the last three months, the Customs department has seized a total of 15 aircraft for alleged evasion of import duty.
27/10/08 Trading Markets, USA

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U.S., India, EU Discuss Relaxing Rules on Airline Ownership

The U.S., India, the European Union and a dozen other countries are exploring ways to liberalize the aviation industry after a weekend summit meeting in Istanbul organized by the International Air Transport Association.
Senior aviation officials from Australia, Brazil, Canada, Chile, Mauritius, Morocco, Panama, Singapore, Switzerland, Turkey and Vietnam were among those assessing regulations on airline competition and ownership with a view toward easing restrictions, said Jeff Shane, an aviation lawyer and former undersecretary for the U.S. Transportation Department, who chaired the meeting. He spoke in a teleconference.
International air traffic is governed by about 3,500 bilateral air treaties that dictate where carriers can fly and how many times a day, how many airlines may fly from a given country, and who must own the airline, Shane said. While many treaties have been updated since the framework was set up after World War II, restrictions on aviation are still tighter than those governing other global industries, Shane said.
By allowing capital to flow more freely within the industry, the airline business would be stronger and better able to cope with difficult periods such as the current one, Shane said. By allowing more competition, consumers would also be better served, he said. Today, for the most part, international carriers may not carry passengers across international lines unless the plane leaves from and ends up in the country in which that carrier is based.
25/10/08 Andrea Rothman/Bloomberg

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Air fares soar for peak season

Panaji: High air fares not withstanding, airlines carrying Indian tourists to Goa will be arriving choc-a-bloc this tourism season.
Season 2008-09 is on, but the high season will set in by mid-November, and reach a peak during the Christmas—New Year week. That’s when a crowd of Indian tourists are expected to descend upon the state. Planning for the season ahead, airlines have upped their fares for the peak period, December 20—January 5 to match the demand for travel to Goa.
Currently a Mumbai-Goa (one way) economy class ticket on Jet Airways, costs Rs 9,115. The same ticket during the peak season, will cost Rs 13,910.
“If you’re flying Kingfisher during that time, the ticket will be around Rs 13,850 for a Mumbai-Goa flight. The fares could go still higher, as airlines change their fare structure depending on the demand during the period,” says a travel and tour operator. Fares are expected to go above Rs 18,000 and even touch Rs 22,000 on Delhi-Goa flights. Travel operators do not rule out such high fares even on the Mumbai-Goa route in the days preceding Christmas and New Year.
In comparison, tickets from Goa to Mumbai or Delhi during the same period, will be at today’s prices.
“Airlines sustain the high pricing from January 1 to January 5, as the travelling crowds reverse routes. Fares can go up as high as Rs 22,000 for a Goa-Mumbai flight,” an airline executive said.
27/10/08 Andrew Pereira/Times of India

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Aviation in India expects 15% growth

As the aviation industry faces its biggest crisis in recent history because of high fuel prices and the economic slowdown, airlines are forced to do business differently as they seek to trim operating costs ruthlessly to brace themselves for tough times ahead.
“Jet Airways is working on all areas to streamline operations, including cutting loss-making routes,” says Wolfgang Prock-Schauer, CEO of Jet Airways, India’s largest private airline.
India’s aviation industry lost $1 billion (Dh3.6bn) last financial year ending March 2008 and it expects to lose another $2bn this financial year.
Jet Airways’ fuel bills have increased by $50 million a month.
The problem in India is compounded by the fact that fuel costs are much higher there than in other countries because of high taxes and excise duties.
The airline has a cost-saving programme in place and is eliminating loss-making routes. These measures will save the airline some $50m during this financial year and an additional $75m next financial year.
The airline is also working to reduce its global distribution system costs.
Another measure being taken is to reduce agencies’ commission.Wolfgang Prock-Schauer says airlines in India have told travel agencies they will migrate to a zero commission scheme as in North America and Europe.
But airlines in India are not just seeing operating costs increase. For the first time in five years, there’s been a drop in demand for air travel in India.
As the demand for air travel declines, more Indian middle-class travellers are reportedly turning to the country’s rail network. Will the trend last? Prock-Schauer says that with the emergence of low-cost carriers in the last four years, airfares have dropped to levels close to rail fares. As a result, the aviation sector had seen 30 per cent to 40 per cent growth per year in the last three years.
The sector, however, has now been plunged into losses due to irrational pricing.
26/10/08 The New York Times Syndicate/Emirates Business 24/7, United Arab Emirate

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Fewer flights for lower footfall

The aviation quake has hit Calcutta airport, with some flights from the city being withdrawn and some schedules being reworked with reduced frequency.
The decisions were all announced on Sunday, signalling the start of the winter schedule for most airlines.
Kingfisher withdrew several flights, including two operated by its low-cost subsidiary Kingfisher Red (earlier known as Deccan) and Air India discontinued its only direct flight to London. Lufthansa reduced the frequency of its Frankfurt service from seven to three flights a week.
Among the Kingfisher flights to be withdrawn are two each to Bangalore and Port Blair, and one each to Bagdogra and Vizag. Now, Kingfisher and Kingfisher Red will have only one daily flight each to Bangalore (via Hyderabad).
Air India’s Calcutta-London flight touched down at the city airport for the last time this season on Sunday afternoon, with 129 passengers on board.
Lufthansa German Airline's decision to slash its Frankfurt service from the city is “linked to the recent economic slump”.
27/10/08 The Telegraph

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Travel agents anxious over commission cut

Mumbai: Calcutta High Court, which ordered status quo on reduction of agents commission from 5% to zero by airlines, will hear the matter on November 3
With less than a week left for the zero commission regime for travel agents to take off, the agents across the country, who heaved a sigh of relief after the Calcutta High Court ordered a status quo in the matter, are as hopeful as apprehensive.
The agents in the city, which is India’s major international gateway, too remain an apprehensive lot as they wait anxiously for November 3, when the matter would come up for hearing at the high court.
Three of the country’s biggest air carriers namely Jet Airways, the National Aviation Company of India (NACIL) that runs Air India and Indian, and Kingfisher airlines had earlier deferred the implementation of cut in agents’ commission, from five to zero per cent, from October 1 to November 1 this year. The airlines had asked agents to instead charge passengers for providing them with ticketing and other services.
Meanwhile, the High Court’s directive came after an agent from the Travel Agents’ Federation of India (TAFI) challenged the airlines’ decision of zero cut regime earlier this month.
An agent from TAFI, on condition of anonymity, also said that the NACIL had tried to move the holiday court twice to get the stay order vacated but to no avail.
27/10/08 Shashank Shekhar/Mumbai Newsline

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Airlines miss deadline to pay dues to Airports Authority

New Delhi: Indian air carriers have missed the Oct 24 deadline to pay their dues to the Airports Authority of India (AAI) for using airport facilities, an official said on Saturday.
Earlier this week, the AAI issued notices to the airlines, including leading private carriers Jet Airways and Kingfisher Airlines, asking them to pay their dues. The airlines owe over Rs.10 billion to AAI.
While Jet Airways owes Rs.3.95 billion, Kingfisher owes Rs.2.11 billion.
The AAI official told IANS that no airline had paid up.
Both Jet and Kingfsher Oct 13 announced a strategic alliance following which they now control 60 percent of the airline market share.
India' flagship carrier Air India pays about Rs.18 billion annually towards landing and parking fees and has an overdue amount of Rs.5 billion.
25/10/08 IANS/Econimic Times

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Top hospitals aspire for air ambulances, rooftop helipads

New Delhi: Ahead of the Commonwealth Games, the most ‘in-thing’ that every super specialty hospital seems to want is an air ambulance and a helipad. Most hospitals are banking on the Games to get permission for a helipad adding an unexplored dimension to patient care and emergency services.
While air medical evacuation is already done in most super specialty hospitals in the Capital, having a helipad on the hospital roof is the next big thing. The All India Institute of Medical Sciences applied for permission from the Civil Aviation Ministry last year. Indraprastha Apollo Hospitals is also hoping for permission from authorities before the Games begin. According to sources, with Apollo in line for a helipad, competitors like Escorts, Max and Fortis are not to be left behind.
Max is also looking at helipads for its newer projects, said Dr Parvez Ahmed, Executive Director, Max Healthcare. They are already into end-to-end emergency service. Recently, an Italian was brought in from Chandigarh, treated and the hospital staff accompanied her back home to Milan.
The Directorate General of Civil Aviation (DGCA) has issued guidelines for planning, infrastructure, markings and safety regulations for construction of roof-top helipads.
26/10/08 Vidya Krishnan/Indian Express

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Passenger traffic drops worldwide for the first time since 2003

Passenger traffic on airlines worldwide shrunk last month, the first such decline in five years and another sign of the rapidly slowing economy.
Overall traffic dropped nearly 3 percent in September compared with a year earlier, according to the International Air Transport Association, an industry trade group. It was the first time traffic declined since the SARS outbreak in 2003, which resulted in greatly reduced travel to Asia.
"The deterioration in traffic is alarmingly fast-paced and widespread," said Giovanni Bisignani, chief executive of the Geneva-based group.
The largest drop came in Africa, where traffic fell nearly 8 percent. Traffic in North America declined by about 1 percent, according to the group.
The only region to see growth in September was Latin America, where traffic increased about 2 percent. But even that was well below the 12 percent growth in Latin American traffic in August.
Bisignani said the global airline industry could lose more than $5.2 billion this year, driven by high fuel prices during the first half of the year and the current slowdown in traffic.
"Even the good news that the oil price has fallen to half its July peak is not enough to offset the impact of the drop in demand," he said.
25/10/08 Trebor Banstetter/Fort Worth Star Telegram, USA

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Railways’ loss is airlines’ gain

Patna: With the railways facing the wrath of anti-MNS protesters in the state, airlines are doing brisk business. Most of the flights operating
between Patna and other cities are booked to capacity.
According to sources, while the occupancy rate in the Jet Airways late evening Patna-Delhi flight was less than 50 per cent in the last one month, it has gone up significantly following the anti-MNS agitation. It was, in fact, cent per cent on Thursday and by Friday afternoon, around 85 per cent of booked had been done.
“We are expecting full booking by evening as people are still enquiring about the availability of seats in different categories,” said a Jet official. “Over 70 per cent of seats on Saturday’s flight have already been booked,” he added.
JetLite flights to Mumbai and Kolkata have done brisk business and their occupancy rate is above normal if one takes into account bookings made till Friday, a JetLite official said.
“Passengers are even willing to pay over Rs 7,000 to book a seat on the Kolkata flight. In normal times, the ticket prices float between Rs 4,000 and Rs 5,000,” he added.
In case of Kingfisher Red, the Delhi flight is booked to capacity till Friday and there is a heavy rush on the Patna-Kolkata route with ticket rates hovering around Rs 7,000.
Air India too is making good money. “Both the flights to Delhi were fully booked in the last two days and it was the same on Friday as well,” said C Balasanmugam, Air India station manager.
While ticket rates in the economy class vary between Rs 5,800 and Rs 12,135, the ticket rate in the executive class is Rs 16,000.
25/10/08 Sanjeev Kumar Verma/Times of India

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ATF prices likely to fall by 16%

New Delhi: Aviation industry experts expect the ATF prices to fall by 16 per cent in November, compared with the current month. This, they say, translates into bridging of nearly half the gap between the airlines’ operational costs and total revenues.
There could also be more good news. With Civil Aviation Minister Praful Patel pushing for decrease in taxes on ATF (taxes constitute 30 per cent of the cost) and meeting Finance Minister P Chidambaram for that purpose next week, any cut would have a positive impact on the break-even levels of carriers. Chidambaram today said that while the government was looking at rationalisation of taxes on ATF, he had posed a question to the petroleum ministry on the issue of excise duty on jet fuel.
In the last two months, ATF prices have dropped by 20 per cent.
According to industry statistics, the current average base price (excluding taxes) of ATF is Rs 44,526/kilolitre. The expected decrease of Rs 6,300/kilolitre will bring the base prices down to Rs 38,226/kilolitre. An addition of 8.24 per cent excise duty and an average of 25 per cent sales tax gives the price of ATF as Rs 50,931/kilolitre, around 16 per cent lower than the current average ATF price of Rs 60,663/kilolitre.
The decrease, according to industry experts, would have been more had factors like the weaker rupee had not stemmed the fall of ATF prices.
24/10/08 Anirban Chowdhury/Business Standard

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Despite slow growth, airlines gear up for a busy winter

New Delhi: The loss-laden airline industry is expecting good days ahead going by their applications from airlines for the forthcoming winter schedule. Scheduled carriers such as Jet Airlines and Kingfisher Airlines plan to operate 11,486 flights per week this winter, 8.11% more than the previous year.
This comes at a time when the domestic air traffic is registering double-digit negative growth and airlines are forced to cut flights to save cost. It is believed that domestic carriers are losing thousand of crores on account of excess capacity and high aviation turbine fuel (ATF) prices.
“We have cleared the winter schedule, approving 11,486 flights per week. While approving the schedule, we considered the capacity of airports and the historicity of the slots utilisation by airlines. Airlines were also given new slots depending upon capacity available,” an official in the ministry of civil aviation said. “Schedules of those planning to start operation in the later part of the winter season was not considered. It would, however, be considered later, based on capacity available,” he added.
Domestic airlines have cut about 20% of their flights in a bid to save costs and reduce losses. The Indian airline industry lost Rs 4,000 crore in 2007-08 on account of high fuel price, excess capacity and under-utilisation of their resources. The total loss of the airline industry during the current financial year may be in the excess of Rs 8,000 crore.
24/10/08 Nirbhay Kumar/Economic Times

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Domestic airlines owe huge money to AAI too

New Delhi: It’s not only Oil PSUs which have to settle their dues from airlines, even the Airports Authority of India (AAI) is standing in the recovery queue with outstanding claims worth approximately Rs 1,011 crore in lieu of services rendered, according to the data released by civil aviation ministry in the Parliament today.
The state-carrier National Aviation Company of India Ltd (Nacil) accounts for more than 60 per cent of total outstanding amount at Rs 653.10 crore. Of this amount, international carrier, Air India owes AAI less than Rs 100 crore, with the rest of the amount due from the domestic carrier, Indian, an official source told The Indian Express.
It is learnt Air India and AAI are entangled in a dispute over land and building rental. Air India has raised questions over the rate and area under measurement of rented property, and has also opposed revision by 5-10 per cent in rentals by AAI, said the source.The ministry has resorted to arbitration to settle dues of the NACIL.
AAI charges airlines for providing services like landing and parking of aircraft, in addition to renting out land and building to airlines for providing engineering facilities and office space. Typically, airlines are to settle their dues within 30 days, a period which has been breached by most, informed the official.
24/10/08 Smita Aggarwal/Indian Express

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Taxpayers robbed to keep airlines afloat

Mumbai: Is the UPA government robbing Peter and Pappu to pay Paul? On Wednesday, the government announced that the airlines can repay their near-Rs3,000 crore overdues to oil companies over the next six months. And current fuel purchases will get a further 90-day credit period.
On Thursday, petroleum minister Murli Deora announced that the government would take a decision on lowering retail prices of petro-fuels in a week in view of the fall in the international prices of oil. Never mind that the fall in fuel prices has partly been offset by the fall in the rupee from around Rs40 in April this year to nearly Rs50 now.
Peter, in this case, is the hapless taxpayer, who will ultimately have to subsidise the losses of the public sector oil companies. Pappu is the investor in oil companies, who will find the share values of oil companies declining as the government keeps robbing them to subsidise Paul – in this case, the airlines and fuel users in general.
Just consider these facts. Indian Oil (IOC), Hindustan Petroleum Corporation Ltd (HPCL) and Bharat Petroleum Corporation Ltd (BPCL) have already borrowed Rs125,000 crore from banks and are dangerously close to their combined eligible limit of Rs140,000 crore. In other words, they are almost out of cash.
On Wednesday, they were literally arm-twisted by their political masters to extend easier ATF (aviation turbine fuel) credit from 60 to 90 days to Jet Airways, Kingfisher and Air India who already owe them a staggering Rs2,962 crore. The airlines assured them that this amount would be squared up by March, 2009, something that oil industry sources claim is “next to impossible” given their precarious financial state.
To add insult to injury, Deora hinted on Thursday that fuel prices could be revised downwards if crude reaches a level of $57 a barrel.
24/10/08 Murali Gopalan/Daily News & Analysis

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FinMin may ease taxes on jet fuel soon: Praful Patel

New Delhi: The finance ministry has no problems with rationalisation of taxes on aviation turbine fuel (ATF) to help the airline industry, Civil Aviation Minister Praful Patel said today.
“In two-three days, the finance ministry will take appropriate measures on the tax-side to help the airline industry,” he told reporters after meeting Finance Minister P Chidambaram.
“He (Chidambaram) certainly believes that there is a case for rationalisation of taxes, which may not have been the case in the past,” Patel added.
The finance minister, on his part, said that he has put a query to the petroleum ministry on taxes on ATF.
The meeting comes close on the heels of the benefits given by oil companies yesterday to airlines which have a total fuel bill of Rs 2,926 crore, around 72 per cent of which is defaulted.
According to the package, the dues will be cleared in six monthly instalments by March 2009. Current ATF purchases will get 90 days’ credit, supported by bank guarantees. Also, jet fuel price revisions will henceforth happen every fortnight.
24/10/08 Business Standard

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Banks want airline ticket sales, planes as collateral

Mumbai/New Delhi: Worried about the financial condition of loss-making airlines in India, commercial banks are asking cash-strapped carriers to pledge future ticket sales, company shares and aircraft as collateral before approving loans.
Almost all domestic carriers are in the process of raising working capital after the Centre eased on Wednesday the immediate financial concerns at the firms by allowing them to square up in six equal instalments dues of Rs2,962 crore owed to state-run oil firms, with no interest levied.
Losses at the airlines are expected to touch $2 billion (Rs9,961.9 crore at the current exchange rate) this fiscal, double the amount they lost in fiscal 2008.
Kingfisher Airlines Ltd chairman Vijay Mallya told the inter-ministerial group, or IMG, that met on Wednesday that “banks are refusing to give letters of credit even as the airlines are pledging securities,” said a government official who attended the meeting and did not wish to be named.
“The IMG is of the view that the finance ministry shall organize an interface between the airlines and the banks to ease the situation,” the official added.
Airline firms typically guarantee payments on purchases of items such as jet fuel through bank guarantees, or letters of credit.
23/10/08 P.R. Sanjai and Utpal Bhaskar/Livemint

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Fuel for large aircraft may be ‘deemed export’

New Delhi: The Government may provide ‘deemed export’ status to aviation turbine fuel (ATF) being sold to Boeing and Airbus aircraft being operated by domestic carriers, thereby ensuring that it attracts a uniform sales tax of 3 per cent throughout the country.
The implementation of the decision will provide the much-needed fiscal relief as the sales tax levied on ATF sold to such aircraft varies from 4 per cent to more than 30 per cent.
The high-level of taxes imposed on ATF, which accounts for between 45 per cent and 50 per cent of the operating cost of most domestic airline is one of the main reasons for the industry reporting losses of more than Rs 4,000 crore.
Speaking to newspersons after a meeting with the Finance Minister, Mr P. Chidambaram, the Minister for Civil Aviation, Mr Praful Patel, said that all issues including taxes on crude and State level taxes and other steps that could be taken to help the industry through the current crisis were discussed.
23/10/08 Business Line

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No relief package if jobs are cut: Aviation ministry to airlines

New Delhi: Desperate to show that its 'relief' for aviation industry was not just for rich airline owners but the aam admi albeit indirectly, the
oil and aviation ministers put pressure on carriers not to cut jobs while clearing the oil package on Wednesday.
This is the only quid pro quo the authorities have managed to extract as airlines have steadfastly refused to pass on benefit of cost cuts to passengers by slashing fares citing mounting losses.
In fact, aviation minister Praful Patel had told Jet chief Naresh Goyal to reinstate the 1,900 employees or else it would become difficult for the government to extend any relief package to airlines.
During Wednesday's Patel-Deora meet, the issue of job cuts came up when AI chief Raghu Menon while speaking on behalf of the industry is learnt to have said how high losses were forcing airlines to cut costs by reducing capacity and job cuts.
At this stage, oil minister Murli Deora is learnt to have said: "Why is this issue being raised now? There should not be any layoffs."
Not to be left behind, Patel is also learnt to have said that Jet's laying off 1,900 was 'inexcusable'. He also told Deora that AI was not planning to lay off any employee and its yet to be cleared leave-without-pay scheme did not have any such feature.
After the meeting Kingfisher chief Vijay Mallya said: "There will be no retrenchment, we will not take anyone's job."
23/10/08 Times of India

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Airlines can repay fuel dues in 6 installments

New Delhi: Indian carriers troubled by a financial crunch on Wednesday got time until March 2009 to clear their dues, estimated at about Rs 2,500-2,800 crore, to Oil companies in equated monthly installments.
The decision was taken at a meeting called by Petroleum Minister Murli Deora with airline bosses and Civil Aviation Minister Praful Patel to work out ways to help airlines stay afloat without hurting the interests of oil firms. Patel said that it was decided that oil companies would extend the credit period on jet fuel purchase to 90 days from 60 now (applicable till March 2009), as also allow airlines to clear dues in EMIs by March 2009.
Kingfisher Airlines Chairman and CEO Vijay Mallya, Jet Airways Executive Director S K Dutta and Air India Chairman Raghu Menon were among those who attended the meeting.
Representatives from state-run oil firms Indian Oil Corp, Bharat Petroleum and Hindustan Petroleum and Finance Ministry officials also attended the meeting.
22/10/08 Indian Express

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IndianOil has to recover Rs 2,000 cr from air carriers

New Delhi: India’s largest oil marketing company Indian Oil Corporation (IOC) alone has to recover dues worth about Rs 2,000 crore from the civil aviation companies on account of unpaid bills for sale of aviation turbine fuel, the company’s chairman and managing director Sarthak Behuria said.
The three state-run oil marketing companies, IndianOil, Hindustan Petroleum Corp Ltd and Bharat Petroleum Corp Ltd, have to collectively recover Rs 2,926 crore from air carriers due to the delayed payments from these companies for the purchase of fuel.
“Out of the Rs 2,000 crore outstanding, receivables of about Rs 1,000 crore have crossed the credit limit period,” Behuria told DNA Money.
Air India (now Nacil - post merger with Indian Airlines) owes about Rs 600 crore, Jet Airways owes about Rs 250 crore and Kingfisher Airlines owes to the company about Rs 100 crore, he said.
Air carriers buy aviation turbine fuel from the oil marketing companies on various commercial arrangements, including credit for up to 60 days for Jet Airways, 7 days for Kingfisher Airlines, and cash and carry for NACIL.
When the carriers fail to make the payment after the credit limit period expires, the oil companies term it as default.
23/10/08 Shaleen Agarwal/Daily News & Analysis

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Copter flies over Parliament, pilot ‘grounded’

New Delhi: A helicopter violated the no-fly zone code and flew over the high-security Parliament area for over 10 seconds on Wednesday afternoon, sending Parliament security and Civil Aviation officials into a tizzy.
According to airport and Directorate General of Civil Aviation (DGCA) officials, the helicopter pilot reportedly had to land at Safdarjung Airport and instead strayed over the Parliament and its annexe. The reason for this lapse, whether a miscommunication between the Air Traffic Controller (ATC) and pilot or the pilot voluntarily entering the no-fly zone, is not yet known. The DGCA has ordered an inquiry into the incident. Officials said a reprimand is likely to be issued to the pilot.
According to officials, a Pawan Hans helicopter entered the no-fly zone around 2.15 pm. Officials said the helicopter was on a scheduled flight from Dehradun to Delhi. The DGCA was informed about the lapse, as was the ATC.
Air space over Parliament, Rashtrapati Bhavan, North and South Block, PM’s residence, the Taj Mahal, Maurya Sheraton and Taj Palace hotels is a restricted area.
22/10/08 Delhi Newsline

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Domestic air passenger traffic dips 30% at Jaipur

Jaipur: The economic slowdown has continued to tighten its grip on the aviation industry. The Jaipur airport has witnessed a sharp fall of 30% dom
estic air passengers in the last quarter (July-September). This is the sixth consecutive month that the passenger movement has seen a fall, thanks to rise in fares several times.
Similarly, the air traffic has registered a negative growth despite a reduction of 40% flights operated by different airlines. The passenger load has fallen to a five-year low at Jaipur airport.
According to the latest figures released by the Airport Authority of India, Jaipur, the total number of passengers in the second quarter of 2008 stood at 1.67 lakh, down by almost 77,000 in the year-ago quarter. September was the worst-hit as air passenger traffic registered a 38% negative growth.
The domestic passengers travelled in September is 50,172, compared with 80,934 in the year-ago month.
During the same period, the overseas travellers registered a minimal growth of 3%, barring September, which maintained a negative growth of 9% due to global slowdown followed by vast cancellations of bookings by foreigners.
23/10/08 Shoeb Khan/Times of India

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Aircraft maintenance has $1-bn business potential in India

Singapore: Indian aviation industry may be going through turbulent weather, yet experts see a growing potential for the maintenance, repair and o
verhaul (MRO) segment of the industry, with projected revenue of $1.07 billion by 2013.
Many companies, including Boeing in a tie-up with the state-run Air India, have announced joint ventures in MRO business and others are waiting in the wings for the government to address some tax issues to jump into the market, the experts added.
Speaking during an MRO Asia symposium here, C.S. Tomar, vice president of engineering and maintenance for Kingfisher Airlines, said the MRO market in the country was currently valued at $405 million with a potential for $1.6 billion by 2018.
"It makes economical sense for us to set up an MRO facility," Sitham Nadarajah, vice president for technical development with Jet Airways, told IANS. "With volumes increasing, we will be looking at D-checks for narrow bodied aircraft like Boeing-737s."
The D-checks are done on aircraft every four-five years, during which the aircraft is completely stripped, checked and then restored.
With India's current fleet of 907 including helicopters, business jets and 395 commercial aircraft, it makes a business case for the MRO industry, the experts said, adding some issues remained to make it a more viable proposition.
22/10/08 IANS/Economic Times

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Cheap airfares resurface to woo travellers back from railways

Mumbai: Airlines are trying to woo passengers back to the skies by offering cheaper fares, special incentives, advance booking plans and frequent flyer benefits to arrest a 19% slide in the number of air travellers last month from a year earlier.
Carriers such as SpiceJet Ltd, GoAirlines (India) Pvt. Ltd that operates GoAir, and IndiGo, run by Interglobe Aviation Pvt. Ltd, have knocked off a Rs150 congestion surcharge imposed on each ticket.
State-owned National Aviation Co. of India Ltd, or Nacil, which runs Air India, never imposed the congestion surcharge, but others including Kingfisher Airlines Ltd and Jet Airways (India) Ltd continue to load this on every ticket.
The airline firms are also going back to permitting bookings as much as six months in advance, dropping the current practice of limiting ticket purchases to three months before the travel date.
After reducing fares by 15% across the board, Delhi-based low-fare carrier SpiceJet on Tuesday reintroduced its Rs99 fare (excluding taxes and surcharges) on some sectors, keeping bookings open into March next year. The airline has also announced an all-inclusive Rs3,225 ticket on the Mumbai-Delhi sector compared with tickets priced between Rs5,000 and Rs6,000 earlier.
The Wadia Group-promoted GoAir has decided to offer every single flyer on the airline a Rs200 voucher with each boarding pass, which can be redeemed on the next ticket purchased within three months. Under a “fly smart” programme, the Mumbai-based carrier has offered a free base-fare ticket against the purchase of the fifth consecutive ticket bought online from now to March.
21/10/08 P.R. Sanjai/Livemint

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Murli Deora meets airline bosses, executives

New Delhi: Petroleum Minister Murli Deora today met chiefs and executives of airlines, along with Minister of Civil Aviation Praful Patel, to discuss payment of dues to oil companies.
Kingfisher Airlines Chairman and CEO Vijay Mallya, Jet Airways Executive Director S K Dutta and Air India Chairman Raghu Menon were part of the meeting.
The meeting was necessitated as some airlines have defaulted on payments at the end of their 60-day credit period for buying Aviation Turbine Fuel.
Representatives from state-run oil firms Indian Oil Corp, Bharat Petroleum and Hindustan Petroleum and Finance Ministry officials also attended the meeting.
22/10/08 PTI/Times of India

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Aircraft repair facility plan in final stages

Mumbai: India will soon have an aircraft maintenance facility in Hosur, Tamil Nadu, which would be operated by Air Works India Engineering Pvt. Ltd.
“We are in the final stages of securing approvals from regulator director general of civil aviation,” said Ravi. S. Menon, director and group head of business development at Air Works, a firm in which publicly traded engineering company Punj Lloyd Ltd and US-based private equity firm Global Technology Investment Group hold 33% stake each. The remaining stake is held by domestic aircraft maintenance firm Air Works India.
The new maintenance, repair and overhaul, or MRO, workshop—which has seen an initial investment of $20 million (Rs97.6 crore)—opens for business at a time when domestic aviation has hit a rough patch reflected in falling passenger numbers.
The Hosur MRO will be the third such facility in the country and the first to be run by a non-airline company. National Aviation Co. of India Ltd, or Nacil, operates one in Delhi and Blue Dart Aviation Ltd has one in Mumbai. However, both service their own planes first and cater to others after that.
Most airlines in India, therefore, have no recourse but to send their planes to Europe, Dubai or Singapore for mandatory checks.
“This MRO will be able to do first four ‘C’ checks of ATR planes,” Menon said. A ‘C’ check is airframe maintenance conducted every year for the first four years of a plane’s life. The aircraft then has to undergo more extensive, or ‘D’, checks. These checks are separate from engine maintenance.
Menon said his firm will initially perform ‘C’ checks for small ATR planes, which are turboprops with up to 72 seats, and eventually graduate to medium-sized planes such as Boeing 737 and Airbus A320, which have up to 190 seats.
21/10/08 P.R. Sanjai/Livemint

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Bjets upbeat on ‘call a jet’ service

The ‘call a jet’ concept is going to catch up fast, if the plans of Bjets are here to stay. Now, the business class which is always on the move, can dial a jet and fly to their desired destination hassle-free, courtesy Bjets, a dedicated private aviation service provider. The company has made a committed investment of $1 billion in India and has already signed up for the debt component.
According to Mark Baier, chief executive officer, Bjets, the investment is being made to enhance the existing fleet strength. “We already have four aircraft now and four more would be added by year-end. This would be a major milestone for Bjets as it would be the owner of the largest fleet of private jets in its first year of operations. We will be adding 50 more aircraft over the next three to five years period. This will be a combination of Cessna Citation CJs and Hawkers”, he said. Private aviation industry in Asia may soon scale to newer heights with increase in the spending power of the business class. Being a new concept in the country, it is yet to pick up momentum in India.
21/10/08 BV Mahalakshmi & Kavitha Venkatraman/Financial Express

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Raytheon eyes $1-bn Indian civilian business by 2018

Hyderabad: Global defence and aviation major, the $21.3-billion Raytheon of the US, sees a $1 billion business potential in the Indian civilian sector alone over the next 5-10 years.The company is currently leading the race to bag a $196-million contract to supply technology for India’s first satellite-based global aviation navigation system, called Gagan.
“India offers tremendous business potential for us,” said Raytheon’s director of business development and strategic planning Fred A. Treyz III, who was part of his company’s delegation to the civil aviation show here last week.
“Although we are looking at about $100-200 million of business in the next two to three years, this figure can easily go up to $1 billion in the next 5-10 years,” Treyz told IANS.
“Besides satellite based navigation systems, we can offer various kinds of airport security and traffic control infrastructure, open road tolling systems and homeland security solutions.”
Currently, Raytheon is leading a team of companies that has bid for the final implementation phase of the Global Positioning Satellite-Aided Geosynchronous Augmented Navigation system, or Gagan, after having successfully deployed the technology demonstration system over the past several years.
Recently, India’s Cabinet Committee for Economic Affairs granted approval to the state-run Indian Space Research Organisation (ISRO) and the Airports Authority of India (AAI) to implement Gagan.
21/10/08 IANS/Thaindian.com, Thailand

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Airlines need to cut fleet, more jobs to stay airborne

New Delhi/Mumbai: Jet Airways’ aborted plan to cut 1,900 staff partially reflected the crisis in the aviation industry. Analysis by Business Standard shows that Indian carriers will need to cut their domestic fleet and manpower by a fifth in the next few months to fully align themselves with the slowdown in passenger growth.
Domestic carriers, which include Jet Airways, Kingfisher Airlines, Air India (for aircraft that fly domestic routes) and the low-cost carriers, have a combined fleet of over 300 aircraft. Some 60 aircraft will have to be withdrawn from this fleet if airlines hope to increase the passenger load factor (PLF) — a measure of capacity utilisation in aircraft — to around 80 per cent, which is required to break even.
The average PLF over the last few months has been 50 per cent. According to the Centre for Asia Pacific Aviation, in the opening busy-season month of October, the average PLF was 60 to 65 per cent, at least 10 per cent less than last year's numbers. A decrease in capacity by 20 per cent on key routes assuming air fares and demand are constant would lead to PLF rising 20 per cent.
Airlines have already cut passenger capacity by 10 to 15 per cent according to aircraft manufacturer Boeing in the last few months but that, of course, is not enough.
The carriers also need to cut manpower by around 12,000 people out of the 60,000 employees working in domestic aviation if they are to stop making losses. The number is based on the fact that the average employee-to-aircraft ratio in India is1: 200 (this number might be slightly skewed because state-owned Air India’s ratio is 1: 300).
In fact, analysts said, the job cuts need to be higher if the airlines want to achieve global aviation standards of 150 employees per aircraft.
21/10/08 Surajeet Das Gupta/Business Standard

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Aviation slump: Here's how Railways cashed in

Mumbai: Statistics now affirm what has long been suspected: A significant rise in railway revenues compared to last year, for the same period that saw airline load factors declining drastically.
A comparative analysis for April-August 2007 and 2008 show a dip in air passenger traffic and a concurrent rise in railway passenger traffic, most keenly observed in the number of Second AC and Third AC. Airline officials admit the tilt too — barring the corporate traveller who will prefer to not travel at all, a large number of fliers is now back in the trains.
Airline industry figures show a dip of four per cent in passengers travelling between April and August this year when compared to last year’s figures. The Indian Railways saw a whopping rise of 21 per cent in its sales of passenger tickets for two and three-tier air-conditioned compartments in the same period.
According to the figures obtained from the Railways, an additional 1.67 crore passengers have travelled between April and August 2008 as compared to the same period last year. On revenue, the railways have recorded a growth of 13 per cent in the period.
Three-tier AC has recorded 35 lakh passengers more compared to last year — the same segment of people targeted by low-cost airlines. This segment also recorded a revenue of Rs 1,283 crore in this period, nearly Rs 300 crore more than the corresponding period last year.
Jeetendra Bhargava, Executive Director of NACIL, said that the drop in airlines’ figures and the subsequent rise in railways’ passenger figure have nothing in common.
20/10/08 Shashank Shekhar/Indian Express

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Cracker of a time for Diwali travellers on ATF price cuts

New Delhi: Tour operators are going out of their way to offer value-for-money travel packages this festive season as foreign tourists cancel bookings to destinations like Rajasthan, Kerala and Goa, owing to the global slowdown.
Several international airlines are now passing on the price cuts in aviation turbine fuel to consumers, which are helping tour operators to offer some discounts, even on international tour packages.
“Things have hit such a low that tour operators are even hardselling Goa and Kerala, which have been the two most expensive tourist spots in the country,” said a senior executive with a tour operator. Tour operators have no other option but to cash in on the festive sentiment to generate occupancies.
Traditionally, Diwali is the time when families like to stay at home and celebrate. According to Thomas Cook COO Vishal Suri, North Indians tend to stay at home and celebrate since they have shorter breaks. “But those in South and West India have longer breaks and like to travel, and one can cash in on the same,” he added.
Says SOTC chief operating officer Sunil Gupta said that even though tour operators have hiked prices for foreign destinations due to rupee devaluation, airfares as well as hotel tariffs have seen some marginal cuts abroad.
Cox and Kings spokesperson confirmed that tour operators are offering discounts.
Besides leisure destinations, hotels are also decreasing rates in metros in sync with the festive mood.
20/10/08 Meenakshi Verma Ambwani & Chanchal Pal Chauhan/Economic Times

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Oil Ministry charges, Patel defends 'defaulter' airlines

Mumbai: According to Press Trust of India (PTI) report, Civil Aviation Minister Praful Patel recently defended delay by airline companies in payment of their fuel bills saying they were not defaulters, but the Petroleum Ministry maintained that Jet Airways had defaulted on payment of Rs 259 crore to Indian Oil Corporation (IOC).
After Petroleum Ministry gave details about the dues of Naresh Goyal's Jet Airways and its new found ally Kingfisher, Patel told reporters in the Parliament that the airline had a 60-day period to make payments. “So they cannot be branded as defaulters,” said Patel. However the Petroleum Ministry countered Patel by saying that Jet had failed to make payments even after expiry of the 60-day grace period. Jet's total outstanding to IOC stood at Rs 859 crore, of which it had defaulted on payment of Rs 259 crore bills, which were due on September 25 and October 5 this year after the expiry of 60-day period, said a senior official.
Similarly, Kingfisher owed Rs 110 crore to IOC, of which Rs 60 crore remained unpaid after expiry of the credit period. Jet owes Rs 284.3 crore to Bharat Petroleum Corporation Limited (BPCL) while Kingfisher owes Rs 246 crore to BPCL and Rs 525 crore to Hindustan Petroleum Corporation Limited (HPCL).
Petroleum Minister Murli Deora had personally brokered the 60-day credit deal between Naresh Goyal’s Jet Airways and Sarthak Behuria, Chairman, IOC. Deora said last week that he was hurt when Goyal did not keep his word on making timely payments. The official said both Jet Airways and Kingfisher Airlines had to clear their outstanding at the earliest as state-run oil firms themselves were in difficult times.
20/10/08 TravelBizMonitor

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New Delhi must learn that air travel is no luxury

For many middle-class Indians, more affordable air travel has been one of the most visible fruits of the recent years of economic modernisation.
Until a few years ago, long railway journeys were the dominant mode of domestic travel for all but the privileged few who could afford hefty fares on monopolistic state carriers.
But since then, new service-oriented private carriers have been making air travel more accessible, allowing millions more Indians to take to the skies. In 2007, Indian airlines carried 43m passengers on domestic flights, up from 16m in 2004, boosting India's domestic tourism and business alike.
Yet, India's government still views air travel as a luxury item - and a potential cash cow to help boost its own weak finances. Indian airlines must pay 60-70 per cent more than the world market prices for jet fuel, due to hefty taxes. The receipts are used partly to finance state subsidies on petroleum products for other users.
That appears unsustainable. Airlines are expected to post combined losses of $2bn this financial year, as passenger numbers decline because of higher fares.
In a bid to pare their losses, private carriers are sending back planes, slashing staff and cancelling expansion plans, while Jet and Kingfisher, the two biggest, have forged a cost-cutting operational alliance.
New Delhi must recognise that air travel is not a luxury item to be heavily taxed, but an integral part of the kind of modern, efficient economy that it aspires to be.
17/10/08 Paul Betts and Amy Kazmin/Financial Times, UK

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Aviation slump hits domestic flyers hard

New Delhi: The number of people taking domestic flights has fallen by 18.5%. This September's low is the straight fourth month in a row that domestic flyers have kept away compared to last year.
When airfares started going up earlier this year with rise in jet fuel prices, small town fliers were the first to shy away from flying. So places like Goa, Patna, Thiruvananthapuram, Guwahati, Calicut, Srinagar and Udaipur started seeing domestic passengers opting for cheaper ways of travelling.
But now the negative trend is visible in most cities, big and small. The number of domestic flyers this July fell to 58.51 lakh compared to 68.77 lakh last July, a fall of -14.9%.
The combined impact of high fuel prices and an economic slowdown has meant that as airlines raised fares, lesser and lesser number of people could afford to fly. With passenger numbers falling, airlines are now slashing capacity by withdrawing flights and returning excess planes. Despite reducing flights by 20 to 25%, airlines are still flying with nearly 40% seats unsold.
Many airlines reported their lowest seat factor in September, with the figure ranging from 64% for Jet to 50.5% for SpiceJet. Clearly, low cost carriers have lost their sheen due to constant fare hikes now as many of their patrons have gone back to trains and buses.
Aviation minister Praful Patel warned that unless the base price of jet fuel and taxes on it were not rationalised, some airlines may have no option but to close down.
19/10/08 Saurabh Sinha/Times of India

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Private aviation is poised to soar high: Baier

Hyderabad: Civil aviation scene in general may be looking downcast but private aviation in Asia, India in particular, is poised to soar high, says aviation expert and BJETS chief executive officer Mark Baier.
"Private aviation is under-developed in India. We see great potential for business development in this segment in the next two years. The current crisis hitting the aviation sector will only be temporary," Baier said.
BJETS is Asia's first dedicated fractional ownership and block charter jet operator based in Mumbai and Singapore, with an operations centre in Hyderabad.
While Briley Group is the majority stakeholder, Tata Group's Indian Hotels Company Ltd also holds a significant stake in BJETS, founded by Singapore-based Person of Indian Origin (PIO) Bala Ramamoorthy.
Talking to PTI , Mark Baier said his company currently has four private aircraft on hand while an equal number would be added by the end of this year.
"A total 50 planes we have ordered for Cessna Citation CJ2s Hawker 850XPs, Hawker 900 XPs and Hawker 4000s will be delivered to us over the next five years and we will be Asia's largest private jet operator by the end of this year," he added.
18/10/08 PTI/The Hindu

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SITA’s APIS solutions to be customised for Indian market

Mumbai: Carriers operating in the Indian skies failed to comply with an order placed by the Ministry of Home Affairs (MHA) to implement Advanced Passenger Information System (APIS) by August 1, 2008. This was the second deadline the airlines missed, while the first deadline was July this year. But according to a recent press statement issued by SITA, major international airlines were using its community APIS solutions which now have to be customised for the Indian market. By the end of the year almost all of the airlines serving some 75 per cent of all India-bound passengers will deliver APIS information using this system, said the statement.
Speaking with TravelBiz Monitor, Bruno Frentzel, Vice President – Applications Services, SITA said, “Our APIS solution is already being used by 50 international carriers, but now we have to customise the solution for the Indian sector. The charges for using the APIS solution will depend on the volume of clients for a particular airline. We are positive about the future growth in terms of signing more deals with international carriers flying to India as the rule is now mandatory; airlines have to follow it for security reasons in the country.”
The APIS system is already operational at Mumbai, Delhi, Bangalore, Hyderabad, Chennai and Kochi airports. Plans are in the pipeline to introduce the system at Kolkata, Amritsar, Guwahati, Ahmedabad, Goa and Trivandrum airports by the end of this year. “We are aiming to introduce the system at all the airports from where the direct international flights take off,” added Frentzel.
18/20/08 Anita Jain/TravelBizMonitor

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Private aviation firms sore over DGCA norms

Hyderabad: Domestic aviation companies that are optimistic about the country’s ability to weather the current “financial storm” appear to be sore over the stringent guidelines of the Director-General of the Civil Aviation.
The Union Finance Ministry’s move to levy around 25 per cent duty in the form of import, countervailing and additional customs duties as well as the delay in obtaining permissions from departments concerned appears to have irked a section of industry.
“Imposing 16 per cent countervailing duty is not justifiable at all. The government’s decision to exempt certain categories from the new duty is deterring prospective buyers from buying aircraft,” Aerosource (India) director Vinod Singel said.
He also objected to the Director-General of Civil Aviation’s (DGCA) move to see that the airlines send back their foreign pilots and recruit local ones by 2010.
“The young pilots, of course, need to be placed. But, one cannot hand over their Rs.100-crore aircraft to a trainee,” he told The Hindu.
Monarch International president Ashok Sawhny is angry with the delays in securing permissions for bringing in new aircraft into the country.
19/10/08 The Hindu

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Deal time at Begumpet

The first civilian airshow in Hyderabad was a hit for political reasons but not for big orders. As India Aviation 2008 came to a close, blame it on economic crisis, no big orders were sealed from the behemoths such as the Boeing or Airbus. Read On >>

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Govt mulls fuel rate cut after airlines toe line

New Delhi/Mumbai: In a quid pro quo of sorts, the government said it would consider a rationalization of jet fuel prices if the country’s airlines, bleeding under the cost of fuel and slowing passenger traffic, do not lay off employees.
Statements hinting that a cut in the cost of jet fuel or aviation turbine fuel (ATF) was in the offing, and that the oil companies would go slow on recovering dues from airlines for fuel sales were made by the civil aviation minister Praful Patel and petroleum and natural gas minister Murli Deora, and came a day after the country’s largest airline by passengers flown, Jet Airways (India) Ltd, reversed a decision to lay off 1,900 employees, a move that provoked outrage among the workers and evoked strong reactions from politicians, including the Union labour minister.
“I told him (Naresh Goyal, the chairman of Jet Airways) that until and unless you create an atmosphere for the government to consider your demand (of rationalizing ATF prices), we cannot be pushing it. A committee headed by the cabinet secretary (K.M. Chandrashekhar) is looking at it. Everybody has to understand that industry is in trouble,” Patel said.
Independently, Deora and a senior member of the parliamentary standing committee on transport, tourism and culture, who did not wish to be named, confirmed that a move was afoot to rationalize ATF prices.
“There is a chance of rationalizing ATF prices. It will be worked out between the ministries,” Deora said. Key Opposition parties said the move had their conditional support.
Sitaram Yechury, a member of the Communist Party of India (Marxist) said: “It (ATF price rationalization) should be neutral to all players. However, first the prices of diesel and petrol should be brought down, which should be followed by ATF price rationalization.”
India’s airlines, including Jet, are expected to end this year with aggregate losses of around $2 billion (Rs9,740 crore), up from last year’s losses of around $1 billion.
A paper released by consulting and research firm Deloitte, on 16 October at the Hyderabad Air Show, said rising fuel prices affect an airline’s profitability and have a cascading effect on the other support services. Government levies on ATF work out to around 35%, including an import duty (20%) and an excise duty (8%). Recommending a uniform tax, Deloitte said one option would be to reduce the excise duty to 4% and to undertake measures to remove the disparity in taxes levied by states.
Kingfisher Airlines Ltd is in talks with Reliance Industries Ltd and other state-run oil marketing firms to import ATF.
18/10/08 Liz Mathew, P.R. Sanjai and Utpal Bhaskar/Livemint

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India may cancel plane orders as credit tightens

Indian airlines may cancel orders for new Airbus SAS and Boeing Co planes as banks refuse to lend to unprofitable carriers amid the global tightening of credit, the Centre for Asia Pacific Aviation said.
"There is no market for buying aircraft now, because there is no market for financing," said Kapil Kaul, chief executive officer of the consultant's Indian unit in an interview with Bloomberg News in Hyderabad, India, yesterday. "It's a bad situation, which can't be corrected immediately."
At risk are about 300 aircraft due to arrive in India in the next five years that Airbus and Boeing are counting on to help offset slowing demand in Europe and the United States. Jet Airways (India) Ltd, the nation's biggest private carrier, has already held talks about delaying Boeing planes, while Kingfishers Airlines Ltd has scrapped three Airbus orders.
"You show me where is the cash," Naresh Goyal, Jet's chairman, said on Wednesday, when asked about the difficulties of raising funds. The carrier has put off raising US$400 million for two years.
Air India, Jet, Kingfisher Airlines and other carriers from the country have placed orders with Airbus and Boeing totaling more than US$30 billion in the past three years as economic growth spurred optimism about travel demand.
Carriers are now struggling to raise funds because overcapacity, higher fuel prices and slowing demand will likely cause the industry to post US$2 billion of losses this year, CAPA said. Local banks have cut lending to airlines, Civil Aviation Minister Praful Patel said.
Lenders worldwide have also curbed loans across all industries on concerns about getting their money back amid bank failures and an economic slowdown.
17/10/08 Vipin V. Nair/Shanghai Daily, China

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Airbus sees more demand from India

Hyderabad: Notwithstanding cancellation of three A340 aircraft by Kingfisher and turbulence in the aviation industry globally, Airbus has said that the company’s latest forecast, which is due in the next two months, would peg the demand for aircraft at a higher level. Read On >>

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Bailout for pvt airlines bad policy, fears govt

Well-placed sources said the government believed that bailouts for the private sector airline industry would raise some policy issues.
Already, two major airlines, Jet and Kingfisher owe Rs 2,024 crore to the state oil marketing firms. And if a package were to be prepared for the aviation sector, demands by other segments could scarcely be ignored.
At a time when the government is trying to encourage state-run enterprises to become more competitive, it’s felt that a bailout for the private sector would be bad policy.
Furthermore, the assistance offered to the banking system so far has been by way of increased money supply, easing of credit norms and special windows for borrowing at reduced rates—none of these measures, it was pointed out, constituted a bailout.
Some adjustments in terms of duty cuts or deferred payments may perhaps be possible, sources indicated, but no wholesale rescue operation is on the cards.
Briefing the media after Thursday’s cabinet meeting, science and technology minister Kapil Sibal said, "There is no responsibility of the government in this case (sacking of Jet employees). Our responsibility is only to ensure that the economy is functioning well."
There is also a view that the woes of the major civil aviation players could not be entirely blamed on the sharp downturn in demand. There had been warning signals for some time now and even IATA had warned that the Indian airline industry would be the second-most affected after the US.
17/10/08 Economic Times

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AviationMin to urge airlines to not charge for congestion

Hyderabad : In its meeting with civil aviation companies’ honchos scheduled in November, the civil aviation ministry will suggest the removal of air congestion surcharge levied by them.
Speaking to The Indian Express, a ministry official admitted that even as capacity building and airport modernisation efforts have reduced congestion at airports to near-zero, aviation companies have not yet fallen in line. Despite repeated warnings to the industry, some airlines are still charging the air congestion surcharge.
“There is no congestion at Delhi airport since the third runway has been launched. Hyderabad and Bangalore being new airports, there is hardly any congestion. Mumbai airport is the only one where congestion may be a problem,”said an official.
17/10/08 Smita Aggarwal/Indian Express

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In-flight caterers braced for the worst

Mumbai: The airline industry worldwide ran into rough weather a few years ago. Now, it’s India’s turn.
Companies that have ruled the Indian hospitality industry are trusted names in inflight catering as well. The market is led by the Taj Group of Hotels which runs TajSATS in association with the Singapore Airport Terminal Services. Like the flight kitchen run by Ambassador Sky Chef, it is located near the international airport in Andheri.
One of these catering firms had listed expansion plans for Nagpur, Ahmedabad, Cochin and Calicut on its website before the downturn.
TajSATS’s international clients include British Airways, Air India, Indian Airlines, Emirates, Qantas, Delta, Cathay Pacific, American Airlines, Virgin Atlantic and other airlines headquartered in the Middle East and domestic clients include Alliance Air, Air India again, Indigo, Spice Jet, Paramount and Jet as well as Kingfisher operations.
Many of these airlines have indicated that sectors would be "rationalised" and flights reduced. But neither TajSATS nor Ambassador Sky Chef was officially speculating on its own losses or that of the industry.
“It does not take a rocket scientist to figure out that ancillary industries will suffer," a TajSATS official said. “The question is how much and we say it is too early to gauge," he added.
17/10/08 Bella Jaisinghani/Economic Times

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IATO to sign MoU with US tour operators association

Kolkata/ Bhubaneswar: Indian Association of Tour Operators (IATO), the apex body of tour operators in the country, expects to sign a MoU (memorandum of understanding) with the Tour Operators Association of USA by the end of this year.
According to the proposed agreement, both the associations will strengthen cooperation so as to promote the development of international tourism and specifically develop tourism traffic from and to their respective countries.
Both the associations will also exchange tourism promotion materials and other tourism information, including policies related to tourism development and investment opportunities in tourism in each other’s country.
“We are in advanced stage of negotiations with the Tour Operators Association of USA and the MoU is expected to be inked by the end of this year”, Vijay Thakur, the president of IATO told Business Standard.
Under the agreement, the tour associations of both the countries would also agree to cooperate in the development of human resources and encourage participation of the respective members in the seminars and conventions organised in India and US.
IATO is constantly increasing its international networking with professional bodies in the tourism and travel sectors with a view to boost international tourist arrivals in India.
At present, IATO has collaborations with the Associations of Indonesian Tours and Travel Agencies (ASITA) and the Nepal Association of Tour Operators (NATO).
17/10/08 Jayajit Dash/Business Standard

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What meltdown? Biz honchos go shopping!

The financial meltdown does not seem to have dented the plans of the jet-setting corporate head honchos and politicians in the country . It seems business is as usual, if not better, for marketers of helicopters and private jets. Read On >>

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Copters fly over meltdown blues

Hyderabad: Even as the general civil aviation industry is going through a meltdown, the helicopter segment appears to be unaffected and in fact excited. Read On >>

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Big market for small aircraft in India

Hyderabad: Moscow-based Russian Aircraft, an arm of United Air Corporation, expects to sell 100 of its Ilyushin series of aircraft (IL 114) in India over the next three years. Read On >>

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