For a long time, Indian aviation was regarded as a rich man's mode of
travel. A host of low-cost airlines changed that perception in the last
decade. But more recently, with most airlines in deep financial trouble
and airfares rising sharply, it is once again turning into a rich man's
preserve. But the civil aviation ministry looks determined to stop this
reversal.
"It is a vital sector for economic growth, and not just some rich man's play," union civil aviation minister Ajit Singh said on Tuesday.
Addressing the media post the meeting of the consultative committee for the civil aviation ministry in Bangalore, Singh said, "Despite the current financial troubles, one thing is clear, this sector is bound to grow as our middle class keeps growing."
But he cautioned about the pace of growth: "Our country's middle class cannot compete with the middle class of Britain, USA, or for that matter Australia."
The ministry is planning a slew of initiatives to help revive the industry. It is looking at a comprehensive civil aviation policy that will also focus on regulatory standards.
"The DGCA (Directorate General of Civil Aviation) needs to be revamped and strengthened. We are planning to replace the DGCA with a Civil Aviation Authority by bringing in a new bill in the winter session of Parliament," Singh said.
He said when the DGCA and AAI ( Airports Authority of India) were set up, the civil aviation environment was very different. "The technology has changed, the requirements of civil aviation has gone up in terms of number of customers and the kind of planes. There are issues such as navigation problems, congestion, because in India over 60% of the airspace is controlled by the defence services."
The ministry also plans to restructure the Bureau of Civil Aviation Security (BCAS) and to constitute a dedicated security force.
The minister said the main issue hurting the balance sheet of airlines is that ATF (aircraft turbine fuel) costs account for over 45% of an airline's operating cost. "ATF cost in India is about 60% to 70% more than that in our neighbouring countries as well as the US, partly because it's not a notified product." He added the imposition of taxes ranging from 4% to 30% by state governments on ATF is an added burden.
"We are trying to make it a notified product and are in dialogue with the oil ministry," said the minister.
The minister said there was a need to develop India as an international hub of passenger traffic and that his ministry had initiated action in this regard, including revisiting the policy regarding bilateral air service agreements with different countries.
On allowing international carriers to invest in Indian airlines, the minister said, "FDI in aviation will happen as soon as we have talked to all of our allies." At present FDI in aviation is allowed up to 49%, but restricts international airlines from participating.
Aerospace
Addressing a meeting of a group of manufacturers of aerospace products, the minister said that the aerospace industry in the country is still in its infancy. But he expressed the hope that the Indian aerospace industry would compete in the global market and would be capable of attaining international standards.
"We are hopefully that in the next decade or so the aerospace industry will be the driver of economic growth in India," said the minister and added, "Bangalore is way ahead of the rest of the country as far as this industry goes."
The minister assured the manufacturers that the specific recommendations of the Aerospace Promotion Council would be taken up with the concerned ministries and departments for speedy action and redressal of grievances.
"It is a vital sector for economic growth, and not just some rich man's play," union civil aviation minister Ajit Singh said on Tuesday.
Addressing the media post the meeting of the consultative committee for the civil aviation ministry in Bangalore, Singh said, "Despite the current financial troubles, one thing is clear, this sector is bound to grow as our middle class keeps growing."
But he cautioned about the pace of growth: "Our country's middle class cannot compete with the middle class of Britain, USA, or for that matter Australia."
The ministry is planning a slew of initiatives to help revive the industry. It is looking at a comprehensive civil aviation policy that will also focus on regulatory standards.
"The DGCA (Directorate General of Civil Aviation) needs to be revamped and strengthened. We are planning to replace the DGCA with a Civil Aviation Authority by bringing in a new bill in the winter session of Parliament," Singh said.
He said when the DGCA and AAI ( Airports Authority of India) were set up, the civil aviation environment was very different. "The technology has changed, the requirements of civil aviation has gone up in terms of number of customers and the kind of planes. There are issues such as navigation problems, congestion, because in India over 60% of the airspace is controlled by the defence services."
The ministry also plans to restructure the Bureau of Civil Aviation Security (BCAS) and to constitute a dedicated security force.
The minister said the main issue hurting the balance sheet of airlines is that ATF (aircraft turbine fuel) costs account for over 45% of an airline's operating cost. "ATF cost in India is about 60% to 70% more than that in our neighbouring countries as well as the US, partly because it's not a notified product." He added the imposition of taxes ranging from 4% to 30% by state governments on ATF is an added burden.
"We are trying to make it a notified product and are in dialogue with the oil ministry," said the minister.
The minister said there was a need to develop India as an international hub of passenger traffic and that his ministry had initiated action in this regard, including revisiting the policy regarding bilateral air service agreements with different countries.
On allowing international carriers to invest in Indian airlines, the minister said, "FDI in aviation will happen as soon as we have talked to all of our allies." At present FDI in aviation is allowed up to 49%, but restricts international airlines from participating.
Aerospace
Addressing a meeting of a group of manufacturers of aerospace products, the minister said that the aerospace industry in the country is still in its infancy. But he expressed the hope that the Indian aerospace industry would compete in the global market and would be capable of attaining international standards.
"We are hopefully that in the next decade or so the aerospace industry will be the driver of economic growth in India," said the minister and added, "Bangalore is way ahead of the rest of the country as far as this industry goes."
The minister assured the manufacturers that the specific recommendations of the Aerospace Promotion Council would be taken up with the concerned ministries and departments for speedy action and redressal of grievances.
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