Page 22 - AAA MARCH - APRIL 2014 Online Magazine

FEATURE REGIONAL

airlines. Carriers looking to commence AAI has identified 35 non-metro and “In fact, many out of those 90 runways
regional air services are now required 27 additional airports for upgrades or are non-operational. This leaves a gap --
to reach a fleet size of three aircraft development, alongside 15 greenfield how to connect places which have shorter
within two years instead of the previously sites that will be established through runways. Airlines are in touch with the
stipulated one year. By the end of five public-private-partnerships (PPPs). manufacturers of small aircraft that can
years, they are required to operate five Aviation consultancy Centre for Asia land there,” he says.
aircraft, an easing of the previous two- Pacific Aviation (CAPA) says the projects However, a major factor that hampers
year deadline. will require at least $30bn of investment. the growth of small airline companies
Following that, several private There are 463 airports and airstrips is the high price of aviation turbine fuel.
companies have applied to the government in the country of which only 281 are “High price of aviation turbine fuel is the
for starting regional airlines services, the operational. Of the total airports biggest issue. We need to rationalise it,”
Minister says. In 2010, five applications and airstrips, 97 are owned by AAI, the minister feels.
were received and permission granted 138 of defence, 161 belongs to state At present, aviation fuel in India is
to three of the companies. In 2011, four governments, six are in joint venture and nearly 50%-60% higher than in countries
companies had applied and three were 61 are private. Of the 281 operational such as Thailand, Singapore or the UAE,
given nod to operate. In 2012, there were airports and airstrips, 65 are of AAI, 90 of due to about 30% additional sales tax
five applications and four were cleared. defence, 67 of state governments, 53 of imposed by states. This pushes the cost of
“The previous strict regulations on private and six are of joint ventures. operations by close to 30%.
fleet size and other operational conditions “We need more connectivity to smaller India is currently the ninth largest
have prevented start ups and growth of cities. There is also the need to build low- aviation market handling 121 million
regional airlines in India so far,” says cost airports at these places. This will domestic and 41 million international
CAPA. surely encourage a growth in passenger passengers annually. India’s civil aviation
India, however, is contemplating to traffic,” minister Singh says. is touted to become the third largest
bring in a new policy for regional airlines Also, airlines must induct small market by 2020.
and has even hired a consultant for the aircraft that can land on short runways, as
purpose. The thrust area of the policy will only 90 runways in the country can handle
be to ensure that airlines connect these jet operations, he adds.
remote areas without bothering about Operating these smaller aircraft is Operating these smaller
commercial viability. cheaper because the sales tax on fuel for aircraft is cheaper
Authorities are also taking note of airport smaller aircraft is only 4%, and also the because the sales tax
infrastructure development, which has airline doesn’t have to pay parking and on fuel for smaller
hitherto been concentrated in the metros. landing charges. aircraft is only 4%.
22 ASIAN AIRLINES & AIRPORTS MARCH / APRIL 2014 WWW.ASIANAIRLINES-AIRPORTS.COM