Indian Airports in a new decade, by Group Captain Kapil Bhargava (Retd).
Despite the Hindu philosophy of detachment from the material world, a good life demands a flourishing economy. Fortunately, India has begun recovering from the world-wide downturn better than most of the First World countries. The improving economy translates into some benefits, such as an increase in domestic air travellers, but the 35 non-metro airports earmarked for improvement are being held back for other reasons. In my opinion, out of five private airports, Delhi and Mumbai still have room for improvement while Hyderabad, Bangalore and Cochin are fairly close to achieving world standards.
Indian Economy: It’s Fits & Starts
India was not immune to the world’s economic downturn, especially as it is now more engaged with the world’s economy than it was in the last century. Its best performance was between the calendar years 2005-2007, with 2006 recording the country’s GDP growth at a fraction below 10%. India’s GDP was 7.8% in the first half of the 2008/9 financial year, but declined to 5.8% in the second half. Forecasts for the current financial year are better as GDP growth rose to 6.1% in the first quarter. The forecasts for the full 2009/10 financial year are somewhat mixed at between 5.5% for pessimists and up to 8% for the optimists. The World Bank has projected a figure of 8%. These figures stand out against the low world economic growth. Along with a slow but steady decline in population increase, the standard of living of many Indians will improve, thus enlarging the middle class, which is the main consumer of aviation services in India.
Higher Passenger Traffic
India’s aviation industry is upbeat again as the number of domestic air passengers increases. Most airlines are seeing higher load factors and some of then are already hiring and increasing capacity. According to the Ministry of Civil Aviation, the total number of domestic passengers increased from 41.3 million in 2008 to 44.5 million in 2009, thereby registering a growth of 7.86%. Meanwhile, there has also been a steady increase in international travellers. The start of this increase can be pinpointed to June 2009. Scheduled Airlines in December 2009 carried 4.9 million passenger compared with 3.99 million in November 2009, indicating an increase of 15.11%. A natural result of these increases is a higher congestion at airport terminals, ramps − including parking bays − and in the air. Delayed departures, often caused by late arrivals, in a cascading effect, are endemic at almost all active Indian airports. Their capacities are being exceeded by considerable margins for all services. The overall On-Time Performance (OTP) of scheduled domestic airlines for December 2009 was 71.5%, not a very happy situation.
Government Owned and Managed Airports
As has been reported often in the past, India has only five privatised airports, but more on these later. Let us first look at all the government-run airports. Attempts to alleviate the congestion problems at these facilities are happening in a ‘stop-start’ fashion, with stops winning handsomely. Current statistics show that India has a total of 448 airports, including small air strips. Of the total, 80 are handling scheduled services. Defence services operate 136 airports, around 30 of which have civil enclaves for handling scheduled flights, including international arrivals and departures. Private industries are said to own 63 mostly small strips for corporate aircraft and private or business operations. All airports, other than defence owned, are managed and controlled by the state-run Airport Authority of India (AAI).
Ever since Mumbai and Delhi airports were privatised, AAI has been saying that it has lost its biggest money earners. According to AAI, profits from these two airports enabled it to support other loss-making facilities − which effectively means almost all the other Indian airports − but financial figures question its claim. As AAI has a share in the equity of both Mumbai and Delhi, its profits have in fact gone up substantially. The private operators of both these airports have almost doubled the revenue and profit after tax. Consequently, AAI is earning more out of Mumbai and Delhi than it ever did before and it is a view that has even been mentioned by MPs talking on the subject in Parliament.
The very dynamic Minister of State for Civil Aviation, Praful Patel had made an ambitious plan to upgrade 35 non-metro airports. Against a Request For Proposal (RFP) for private management on a profit sharing basis, many very attractive offers were received. However, none were successful and the fact that no further privatisation has yet been allowed is a situation that is well supported by the nation’s left-wing political parties. As a result, the proposed upgrade of the 35 non-metro airports appears to have halted for the time-being and it will be interesting to see how Praful Patel unravels this particular problem.
Ad Hoc Approach
As most foreign visitors learn quickly enough, anything in India passes muster if it leaves the responsible person’s ‘backside’ safe. In a previous report, the case of the terminal at Udaipur had been briefly mentioned. Udaipur was a princely state of Rajasthan until it was integrated into the Indian Union after Independence. Today, with its famous Lake Palace and many other attractions, it is a good tourist destination. The city had a very shabby terminal, almost like the dirty railway stations prevalent in most of the country. It was handling rather meagre scheduled air services. Suddenly, AAI gave it a complete ‘makeover’ and it is now ten times its original size and is clean and modern in appearance. The total investment in it was Rs 150 crore (US$32.4 million). Unfortunately, there never appeared to be any prospect of increasing passenger numbers using it, or a greater number of fights serving it. Now it seems the already loss-making airport is likely to lose ten times as much. Many think this is a recipe for disaster and it highlights the potential pitfalls that lie in the path of progress. It looks likely that if the AAI lost control of its airports to private companies, few similar projects would be undertaken in the future.
Some Progress Despite Hurdles
Statistics show that 50% of Indian’s airports are now offering passengers bar-code access and boarding. If true, in a country where infrastructure can be slow, this progress is remarkable. Though the driving force behind this development is IATA’s initiative towards 100% world-wide paperless passenger handling within two years, credit must also go to Kingfisher and Jet Airways, the two carriers with the highest number of passengers. Among busy and important Indian metro airports, Chennai has been upgraded considerably. It claims to have installed the country’s very first ‘walkalator’ (moving walkway). The airport has recently been praised in a poll of its frequent users. Work is also in hand to improve passenger handling capability at Kolkata. Plans include constructing a second runway and providing a good integrated terminal.
Parts of Delhi Indira Gandhi (IGI) Airport resemble construction sites with much work in progress and its capacity problems are highlighted by the fact that, having recently surpassed Mumbai, it is now the country’s busiest passenger airport. Unfortunately, with regard to ground operations, it currently carries the stigma of having the greatest number of accidents, but perhaps this is to be expected at the busiest airport.
The GMR Group which made Hyderabad the best airport in India is hoping to excel itself again with Delhi. Perhaps a big boost for Delhi will be derived from a metro link to the city. No other Indian airport appears to be planning a similar move. There has been some indeterminate planning for another Delhi airport across the Yamuna River, though nothing firm has been decided yet. If it ever comes to fruition through, the GMR group looks to be the front runner for any development contract.
Mumbai Airport does not have enough available land for expansion. This is the setting of the smash-hit multi Oscar-winning movie Slumdog Millionaire, where thousands of slums and other buildings surround the airport and the answer to its expansion needs will only come via the proposed Navi Mumbai (New Bombay) airport to be built across the city’s bay. About 55% of required land for it has already been acquired and the rest is being actively pursued.
Cochin International Airport Limited (CIAL) has the only terminal built in what I would describe as total harmony with the local style. It has a perceptible ‘character’ and CIAL’s fortunes have been turned around in the last two years. It has recently launched its aviation academy and is hoping to start a Kerala Airline, as soon as it can obtain necessary permissions from the Central Government.
Bangalore / Bengaluru International Airport has been in the news recently, mainly due to changes in equity participation. The current largest private share holder is the GVK Group, which manages the Mumbai airport. It has some major plans for Bengaluru, including a mirror image terminal to be built along the south side wall of the existing one, the construction of a second runway and generally enhancing passenger amenities.
A major problem for India is the lack of suitably trained air traffic controllers. Unfortunately, there is also a dire lack of modern systems such as radars, Category III ILS, ground movement control systems and secure communications. These have a direct impact on the safety of civil airline operations at most airports. A recent safety audit by FAA threatened the discontinuance of flights to the USA and, as a result, many welcome changes are now in hand. Hopefully, these will take effect soon.
Indian Airports in a new decade, by Group Captain Kapil Bhargava (Retd).