AAI pegs 18,000-capex over 4 yrs

Hyderabad: Airports Authority of India (AAI) will be spending Rs18,000 crore over next four years, said a top official at Ministry of Civil Aviation (MoCA). Airlines are facing challenges owing to lack of adequate cash reserves, while there’s huge business potential in domestic aviation sector in India as income levels of middle class on the rise, according to the official. To enhance infrastructure in the country, state governments need to support the regional air connectivity programme under UDAN, he said.

RN Choubey, Civil Aviation Secretary, spoke at Wings India-2018 here on Thursday. Citing reasons for closures of Kingfisher Airlines, Deccan Airways, Gujarat Airways, etc, Choubey said: “Lack of cash reserves, airlines land in trouble as they can’t pay lease, salaries, etc. We ask all the state governments to extend their support to boost regional air connectivity in the country. For instance, Assam government has decided to contribute Rs100 crore every year for three years. Some states came forward to underwrite seats on flights to support airlines.” 
Infrastructure and developing skilled manpower are two major challenges in the domestic aviation sector. 

Elaborating on future plans, Choubey said: “India (AAI) will be spending Rs18,000 crore over next four years. Under brownfield airports project, 12 airports are expanding. Out of the 56 destinations under UDAN target, we made 19 destinations connected. We’ll be adding one new airport every 15 days. More airports are expected to be operational in the next eight months as by that time the second phase of UDAN will also take off.”

Sandip Somany, Senior Vice-President at FICCI, said that regional connectivity scheme, UDAN, merits a special mention. It provides greater connectivity to under-served and unserved airports of the country. Under UDAN-1, the government is expected to provide around 1.3 million seats per year, of which half will be covered by airfare of maximum Rs2,500. Under UDAN-2, around 2.5 million RCS seats and nearly 5.5 million total passenger seats will be available per annum. 

Somany further added that the conference will focus on fostering partnership to transform Indian aviation and the role of conducive regulatory framework to facilitate growth of civil aviation market. It will represent the strength and opportunities in the aviation sector to the potential stakeholders.

Challenges 
Doublcing capacity in next four years is a big challenge as land is not available. Increasing throughput by increasing infrastructure at airports is one option. Passenger load to bigger aircraft from smaller plane is one option, said Choubey.

The Centre is planning to develop 400 airstrips, which were set up during World War-2, into full- fledged airports over next decade. “If some airlines come forward, then we’ll assign airstrips for development,” he said.

3-pronged approach
The Centre plans three models for the domestic civil aviation growth. Land acquisition process to allow land pooling airport-cum-township will be under model-1. Second model includes a plan that if airport is within city, then another airport on outskirts will be set up. Under model-3, MoCA will be working with state governments via JV with 51:49 equity ratio for 10 years.