The Hindu : Regulatory authority for privatised airports proposed

Online edition of India's National Newspaper
Sunday, Feb 09, 2003

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National

Regulatory authority for privatised airports proposed

By Gargi Parsai

New Delhi Feb. 8. There is no clarity yet on the privatisation of the four metro international airports, even as there is a debate on setting up a regulatory authority to regulate the airports once they are privatised or upgraded to world class standards.

This is what the Additional Secretary and Financial Adviser, Civil Aviation and Tourism, V. Subramanian, said in response to the ``recommendations'' of the CEOs' conclave at CII's India Infrastructure Show.

Mr. Subramanian has recently been appointed the head of a committee to look into the route rationalisation for Indian Airlines and Air India.

Mr. Subramanian said, ``the process of airport privatisation started six years ago. Still we do not know where we stand.''

He said there was a proposal to have a regulatory authority. It will be under the Directorate-General of Civil Aviation (DGCA) — whether as an independent entity or as a part of the DGCA, was to be decided.

Whether the DGCA, which is responsible for monitoring safety in the aviation sector, should be the agency to investigate accidents or there should be a separate commission on the lines of the Railways Safety Commission is also to be decided.

Commenting on the Uttar Pradesh Government's proposal to construct an international airport (the Taj Airport), about 70 km from Delhi and 30 km from the Indira Gandhi International (IGI) Airport, Mr. Subramanian said the industry had recommended that there should not be ``far too many'' international airports, especially in the vicinity as it might cannibalise traffic from other airport.

He also made the point that passengers today preferred to travel point-to-point, rather than as transit passengers. This was to counter the U.P. Government's proposal to make the proposed airport as a ``hub'' to attract airlines which overfly the country.

For an airport to become a ``hub'' it should have a strong international or domestic airline base. Its success not only depended on fiscal incentives but also the traffic pattern.

Mr. Subramanian said private sector was welcome to invest in upgradation of international airports but should not look to the Government to ``partially fund them '' or provide subsidy.

He said global bids had been invited for ground handling services at the four metro international airports, ``but one player did not want the other and so the proposal ran into trouble''. It was being sorted out, he said.

While asking airlines to focus on security costs as a long-term expenditure in the changing global scenario, he said the Inland Air Traffic Tax was not meant for airlines and various revenue authorities had differences over reducing sales tax on fuel, which had to be taken into consideration.

He said the Government was in no hurry to relax the Air Charters Policy for outbound tourists, ``as the focus is to attract tourists''.

However, the feasibility of constructing ``heliports'' would be looked into after discussion with State Governments who will have to construct and maintain the helipads in parts of the country for better connectivity.

The Secretary of Industrial Development, U.P., Anoop Mishra, said their proposal was to construct a greenfield international airport on ``build-own-transfer'' basis, 70 km from Delhi, as part of the industrial and urban development that was being planned.

His idea of bringing in international tourists to the Taj on a return 12-hour transit did not go down well with the audience some of whom said that the idea of tourism was to make the tourists stay on.

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