New civil aviation policy soon: Ajit Singh

Hyderabad, March 12 (INN): Civil aviation minister Ajit Singh on Monday said that the government was working on a new policy which would propel India among top five markets in the world by providing access to safe and affordable air services with a strong regulatory framework and world-class infrastructure facilities.

The ministry of civil aviation would also consider the proposal to work out a separate air cargo policy as 200 freighter aircraft will be required in the next 20 years to meet the industry's demand, he said as industry body ASSOCHAM submitted an action plan to bail out the civil aviation sector from current financial crisis.

Narayana Rao, chairman of ASSOCHAM committee on civil aviation and infrastructure, DS Rawat, secretary general, and Ajay Sharma, senior director, met Ajid Singh and urged him to push for separate budgetary allocation and land for developing airports across the country.

Upgrading infrastructure, attracting domestic investments and easing norms on foreign direct investments are essential so that the sector can grow annually by eight per cent and raise freight traffic from 23.5 lakh tonnes now to 70 lakh tonnes in the next ten years, according to ASSOCHAM.

To achieve India's standing as a global trans-shipment hub, there is a need for simplification of procedures like 100 per cent electronic approvals.

There should be inter-linkages with airlines, airport operations and air freight stations, customs, banks, clearing house agents and other allied agencies for greater mobility of processes. Land should be demarcated for air cargo villages at airports or nearby regions.

ASSOCHAM said air freight stations should be established in hinterlands to decongest warehouse and offset limitations of space. They should have facilities for palletisation, customs examination and X-ray screening.

There should be cargo facilities at tier II and III cities as alternate growth centres.

The dwell time at Indian airports is 40 to 120 hours as compared to international average of 4 to 12 hours.

There is need for establishing an Air Cargo Promotional Board for further organised growth and deployment of air cargo hubs across the country.

Automatic storage and retrieval system should be a mandatory requirement for any air cargo terminal exceeding a specified volume of cargo handled.

This will bring discipline, reduce manpower requirements, improve efficiency and eliminate cargo un-traceability.

The chamber said civil aviation should be granted infrastructure status and aviation turbine fuel should be notified as declared goods (of special importance) with uniform central sales tax of only four per cent across the country.

The passenger handling capacity at airports jumped two-fold from 72 million in 2005-06 to 143 million in 2010-11.

However, significant investments are required in terms of construction of new airports, expansion and modernisation of existing ones, improvement in connecting infrastructure (road, metro and sea link) and better airspace management.

ASSOCHAM called for introducing fiscal incentives and innovative funding solutions to overcome constraints being faced by airport operators.

Indian carriers catered to 5.4 crore domestic and 1.3 crore international passengers in 2010-11. But in spite of enormous growth and increasing trend towards moving to the low cost model, airlines suffered a loss of over Rs 20,000 crore in the past three years.

The chamber said allowing FDI by foreign airlines and allowing more Indian carriers to fly overseas by utilising full quota of bilateral agreements could be key enabler to fuel further growth.

At the same time, the government must rationalise ATF prices in tune with international benchmarks through policy changes. Airlines are expected to add 370 aircraft worth Rs 1.5 lakh crore by 2016-17.