The Indian government is yet again making a push towards connecting unserved and underserved airports via the UDAN policy (now in its fourth phase) while preparing for the privatisation of an additional six airports. Even so, the challenge of developing regional airports remains. The Airports Authority of India has spent over Rs 1,100 crore on this effort yet the facilities and operations at these airports remain woefully inadequate. While the rhetoric is high, traffic levels are low. Viability is suspect. And consequently, airlines are reluctant to include these airports in their networks. What will it take to change this?
Historically, a regional airport is one that sees traffic of fewer than one million passengers per year. For India with a total of 449 airports, the majority of airports are in this category. Those with scheduled services sometimes see footfalls of as little as 7,000 passengers. Most regional airports operate at a loss.
Because traffic is the lifeblood of any airport and revenue generation is mostly linked to traffic, these miniscule traffic volumes effectively mean that smaller airports are challenged to provide an adequate return. By the numbers, estimates for the Airports Authority of India (AAI) indicate that 75 percent of the airports owned by AAI are registering losses – most being regional airports. With the profitable airports being privatised, AAI is set to receive a stable revenue stream which can then be deployed towards developing regional airports. This in addition to the healthy cash-balance that is in excess of $2 billion. Thus indications are that heavy investment into developing small regional airports will likely be a focus area for the future.
But along with developing infrastructure, there also has to be an effective strategy geared at developing traffic, tourist footfalls and connectivity. On this front, several avenues remain unexplored.
25/12/19 Satyendra Pandey/CNBC TV18
To Read the News in full at Source, Click the Headline
Historically, a regional airport is one that sees traffic of fewer than one million passengers per year. For India with a total of 449 airports, the majority of airports are in this category. Those with scheduled services sometimes see footfalls of as little as 7,000 passengers. Most regional airports operate at a loss.
Because traffic is the lifeblood of any airport and revenue generation is mostly linked to traffic, these miniscule traffic volumes effectively mean that smaller airports are challenged to provide an adequate return. By the numbers, estimates for the Airports Authority of India (AAI) indicate that 75 percent of the airports owned by AAI are registering losses – most being regional airports. With the profitable airports being privatised, AAI is set to receive a stable revenue stream which can then be deployed towards developing regional airports. This in addition to the healthy cash-balance that is in excess of $2 billion. Thus indications are that heavy investment into developing small regional airports will likely be a focus area for the future.
But along with developing infrastructure, there also has to be an effective strategy geared at developing traffic, tourist footfalls and connectivity. On this front, several avenues remain unexplored.
25/12/19 Satyendra Pandey/CNBC TV18
0 comments:
Post a Comment