Economic Times: September, 2016
New Delhi: Minister of State for Civil Aviation Jayant Sinha has told ET that the government is looking at a six-year plan to upgrade airport infrastructure, given that India's metro airports are bursting at their seams, and are struggling to cope with the crush of passengers and choked runways. The upgrade is almost imperative as Indian airports are expected to cater to a billion footfalls over a decade from now, and airlines have announced mega aircraft induction plans that stretch up to a decade, the minister said.
"Looking at the passenger growth, we expect the size of the Indian aviation market to grow to about 600 million air passengers annually over 10 to 12 years from now.This would mean a billion footfalls at our airports. We are working with a strategy spread over a period of up to six years to ensure that capacity does not become an impediment to the growth in aviation in India," Sinha told ET on Friday.
Sinha further explained that the government is going to work on increasing airport efficiency during the first two years.
"This would include looking at Juhu as an alternative and shift out general aviation traffic from the current airport in Mumbai. Between the second and fourth year, we will be carrying out upgrades at airports like Delhi, airports in the northeast and others. Even as we do this, we will keep awarding new airport projects, which will be available post the fourth year onwards.
We have already awarded Goa, and Navi Mumbai airport is likely to awarded soon," said Sinha. The ministry's plan has come as a respite for airlines in India, which have plans to induct over 500 aircraft in their fleet through a 10-year period, and have started complaining about saturating airport capacity across the country.
While Mumbai airport is unable to add any new domestic flight due to lack of free slots, Delhi has not been able to add new flights during peak hours. Airports Authority of India (AAI), the state-run airport operator, is also constrained forcing it to hire consultants to improve efficiency at their airports.
Airlines, however, expressed fears that saturating airport capacity may impact their plans. "It seems we are again back to 2009, when airports capacities were saturating and there were no slots or space for new flights. New private airports came up and state-owned AAI also improved its infrastructure and things improved and airlines grew. Expansion plans might get impacted if airport infrastructure does not catch up with growth," said a senior airline executive, who did not want to be identified.
ET VIEW: Need Proactive Policy
We need heightened investment not just in the metros, but also in multiple no frills airports in tier III towns. It would improve connectivity and should reduce congestion in the metro airports. Apart from holistic policy design, proactivity would be key. The new policy of 100% FDI in airports allows 49% stake via the automatic route, and beyond that by way of case-by-case government approval. Further, the policy of not allowing airlines to have even minority stakes in airports and terminals needs to be revisited.