Tuesday, January 22, 2019

Indian ground handling industry headed down a vulnerable path on unsustainable bids

2018 has been a bittersweet journey for India’s civil aviation industry. While domestic passenger traffic in the country registered a double digit growth for the 50th month in a row in October 2018, balance sheets of airlines continue to be in the red due to fluctuating ATF prices, depreciating rupee and ruthless competition. Moreover, airport expansion and upgradation hasn’t been able to keep pace with passenger traffic. Government’s efforts to widen air connectivity through flagship initiatives such as UDAN have spurred the need for ensuring our airports are equipped to handle the increased traffic without compromising on passenger comfort, safety and security.

Ground handling (GH), a core function in the aviation industry, shall be critical for the success of these connectivity plans as it enhances the safety and comfort of the flying experience in addition to securing short turnaround time at airports. GH includes services such as check-in and baggage handling, aircraft handling, servicing and cleaning as well as cargo handling services. Signalling the significance of GH in the development of aviation sector, the Ministry of Civil Aviation revised the ground handling policy last year mandating that airports should have at least three certified agencies providing ground handling services.
In a laudable move towards ensuring better and safer airports in the country, Airports Authority of India (AAI) in 2018 invited bids for issuing licenses to agencies to provide ground handling services at 93 airports under its control. As per the bidding process, the service provider that quotes the highest royalty that it can pay AAI in lieu of carrying out ground handling services at an airport will be the awarded the GH license.
21/01/19 Ashok Chhibbar/Financial Express
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