Saturday, May 16, 2020

Indigo and Spicejet get shorter routes, cheaper fuel bills while Adani, GMR, and GVK get more airport projects to bid for

India opened up more of its airspace for airlines to ply, decided to put up more airport development projects for bidding, and ease taxation as well as restrictions on maintenance and repair to bring down costs for aviation firms.
These reforms announced by Finance Minister Nirmala Sitharaman will benefit both airline operators like IndiGo and SpiceJet, as well as developers like GMR, GVK and Adani Group.The government estimates airlines will save about ₹1,000 crore a year by flying shorter routes.
 “60% of the Indian airspace is freely available, because it is fairly restricted for civil and defence purposes, so we have been taking longer routes. This has to be rationalised for optimum utilization of time and fuel. Customers can get to their destinations quicker and cheaper,” Sitharaman said.
The second step taken was that six more airports will be put up for auction by the Airports Authority of India and will be built on public private spaces.
 “Additional investments will be made by private players in 12 airports where investments are already present. The financial implications will be on the AAI. The first and second round of investments to get ₹13,000 crore,” said Sitharaman.
 India currently has several airport projects under construction – the Jewar international airport in Greater Noida, the Mopa Airport in Goa, Navi Mumbai international airport in Maharashtra, Sabarimala airport in Kerala among others. In April 2020, GMR got the go-ahead for the Bhogapuram airport in Andhra Pradesh. In February 2019, the Adani Group won a tender to operate all six governmentowned Indian airports located in Ahmedabad, Jaipur, Mangaluru, Trivandrum (Thiruvananthapuram), Lucknow, and Guwahati.
16/05/20 Sanchita Dash/Business Insider
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