In an effort to take air travel to the masses, the Modi government has come out with a new draft civil aviation policy, which was unveiled proposed to cap small town route fares at Rs. 2,500 per flying hour per ticket in its draft civil aviation policy. However, it has also proposed a 2-per cent cess on all domestic trunk route tickets as well as international tickets.
The ₹1,500 crore collected annually from the cess will be used for viability gap funding (VGF) to operate flights in remote areas. The draft policy proposes to create a Regional Connectivity Fund for VGF. It wants the VGF shared by the Centre and the States in the 80:20 ratios.
However, the draft civil aviation policy cannot be considered a policy document, unless it is gets approved by the Cabinet and with incorporation of stakeholder views.
The draft policy has announced the intent of the Government to corporatize the Airport Authority of India (AAI) and Pawan Hans helicopter corporation and also list them on the stock market. This has welcomed by all quarters as it will bring transparency and greater efficiency to those institutions.
The draft policy has not brought out the difficulties facing by AAI. However, the draft is mute on hiving off the Air traffic management, par of AAI, which has been recommended by various committees and will also make Air navigation service most robust. This will also reduce the profitability of AAI substantially, as Air Navigation is a profit centre.
The draft policy also expressed its intent to have six international hubs in India, this is a more wishful, but also realistic. As Mumbai Airport reaching a saturation point soon and New Airport is coming up as yet. Only Bangalore and Hyderabad can be considered for a Hub. Of this, Delhi would qualify on grounds of being the biggest Airport of India and still having capacity to expand more. But in order to create a Hub there is a need to have a strong long haul airline of the country.
04/11/15 G Rajendra Kumar/Hans India
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The ₹1,500 crore collected annually from the cess will be used for viability gap funding (VGF) to operate flights in remote areas. The draft policy proposes to create a Regional Connectivity Fund for VGF. It wants the VGF shared by the Centre and the States in the 80:20 ratios.
However, the draft civil aviation policy cannot be considered a policy document, unless it is gets approved by the Cabinet and with incorporation of stakeholder views.
The draft policy has announced the intent of the Government to corporatize the Airport Authority of India (AAI) and Pawan Hans helicopter corporation and also list them on the stock market. This has welcomed by all quarters as it will bring transparency and greater efficiency to those institutions.
The draft policy has not brought out the difficulties facing by AAI. However, the draft is mute on hiving off the Air traffic management, par of AAI, which has been recommended by various committees and will also make Air navigation service most robust. This will also reduce the profitability of AAI substantially, as Air Navigation is a profit centre.
The draft policy also expressed its intent to have six international hubs in India, this is a more wishful, but also realistic. As Mumbai Airport reaching a saturation point soon and New Airport is coming up as yet. Only Bangalore and Hyderabad can be considered for a Hub. Of this, Delhi would qualify on grounds of being the biggest Airport of India and still having capacity to expand more. But in order to create a Hub there is a need to have a strong long haul airline of the country.
04/11/15 G Rajendra Kumar/Hans India
