Thursday, December 20, 2007

Indian airlines in merger plans

Two of India's airlines have unveiled a plan to merge in an attempt to boost profitability amid rising costs and falling air fares.
Deccan, Indian's first discount carrier, is entering a tie-up with the more upmarket Kingfisher Airlines.

Kingfisher is owned by alcohol baron Vijay Mallya and is named after his flagship beer brand.

There is intense competition in India's aviation sector as more people become able to afford plane travel.

There are currently 10 Indian carriers, up from three in 2003, with at least 14 more airlines seeking government approval to start flying in India.

The merger follows earlier consolidation in the sector. The country's largest domestic carrier, Jet Airways, bought Air Sahara for $340m in April.

'Logical'

Deccan has struggled this year, and sold a 26% stake to Mr Mallya's UB group in June, which was raised to 46% in October.

"The merger will bring about synergies across the board and lower the cost of operating both airlines," Deccan founder GR Gopinath said.

Next August will mark five years of Deccan operating, which means that under Indian law, it can then fly lucrative overseas routes.

Kingfisher will also gain this privilege as part of the merger.

"The merger is logical under the circumstances," said Kapil Kaul of the Centre for Asia Pacific Aviation (CAPA).

"But it has to be done right because the two airlines come from cultural extremes - one a low-cost carrier and the other a full-service premium airline."

UN team visits Mizoram

Aizawl, Dec 20 : UNESCAP (UN Economic and Social Commission for Asia and Pacific) and SARDEG (South Asian Regional Development Gateway) officials have arrived at this Northeastern town to initiate a poverty alleviation programme in Mizoram.

On the request of the Mizoram government’s high-level working group, the UN team have arrived here last evening. The team members comprise Regional Advisor on Poverty Reduction in UNESCAP Dr Amitiva Mukherji, CEO and Chairman of SARDEG Dr Baharul Islam and SARDEG Technical Adviser Atique Rehman Barbhuiya.
They had a meeting with I&PR Minister and Chairman of the high level working committee R Lalthangliana and chief secretary Haukhum Hauzel and various department officials.

Briefing their initiatives in more than 60 Asia Pacific countries including India, Amitiva Mukherji expressed his enthusiasm to launch their mission - ‘poverty reduction’ here in Mizoram. He expressed serious concern over the conditions of majority of the people in India, when compared to those of the developed countries. He, however, appreciated its emerging situation and expressed his expectation on Mizoram to come to the forefront in this development trend.

The Mizoram government has constituted a high power inter- departmental committee on international cooperation under the chairmanship of Chief Minister Zoramthanga to seek foreign assistance in the fields of education, sports and employment opportunities. Moreover, a high-level working group on international cooperation under the chairmanship of I&PR minister R Lalthangliana has been initiated to do the needful in negotiating matters like education, youth welfare and sports, health and medical education and different projects to invite as many foreign helps as possible.

As a follow up programme of the working groups activities, a World Bank-sponsored SARDEG’s delegates had earlier studied Mizoram. The UN team is scheduled to meet the Governor, acting chief minister, speaker and legislators, besides departmental officials this afternoon.

50 airports/airstrips in the North-Eastern region

GUWAHATI, DEC 18: With the objective of operating up to 50 airports/airstrips in the North-Eastern region by the end of the XIth Five Year Plan and providing up to 600 flights per week

within the region by using the appropriate type of aircraft; making the required improvements in existing airports / airstrips in a time-bound manner, the North-East Council has directed the Ministry of Development of North-Eastern Region and other related agencies of the Government of India to proceed expeditiously

Most of the places in the North Eastern region are inaccessible and located in far-flung areas. The road and rail infrastructure is inadequate therefore, air-connectivity is the most viable means of transportation in the region, both for intra-state connectivity and the region's linkage to the mainland.

Keeping this in mind, the Government of India, has accorded top-most priority to development, by setting up 'Greenfield' Airports and opening operation of airstrips in the North-East region, with the objective of operating upto 50 airports / airstrips in the North Eastern region by the end of the XIth Five Year Plan, and providing upto 600 flights per week within the region.

There are a total of 23 airports in the North-Eastern region, out of which 11 are currently operational. These airports are Agartala, Aizawl, Dibrugarh, Dimapur, Guwahati, Imphal, Jorhat, Lilabari, Shillong, Silchar and Tezpur. The airport at Lengpui, Aizawl is owned by the State Government. The 12 non-operational airports are Along, Daparizo, Kailashahar, Kamalpur, Khowai, Pasighat, Rupsi, Tezu, Tura, Turial, Ziro and Shella.

The AAI is also planning to develop new 'Greenfield' airports at Cheithu in Nagaland, Itanagar in Arunachal Pradesh and one at Pakyong near Gangtok in Sikkim, which is estimated to cost Rs 320 crore.

The Airports Authority of India (AAI) also has plans to develop two new 'Greenfield' airports at Kokrajhar in Assam and Tawang in Arunachal Pradesh, as part of its efforts to expand air connectivity to the North-Eastern states.

"The Government of India is laying special emphasis on development of airports in the North-Eastern region, and as per our plan, we are preparing feasibility studies for new airports in Kokrajhar, Tawang," remarked G K Chaukiyal, executive director (Planning), AAI at a recently held conference on Airport Development and Modernisation.

Statistics available with the Ministry of Development of North-Eastern region (DONER), Government of India, indicate that there was a reported growth of 23.4 per cent in aircraft movement in the North-Eastern region (NER) between 2004-05 and 2006-07 and a growth of 40.2 per cent in passenger traffic for the same period.

At present airlines, operating in the region include Indian, Alliance Air, Jet Airways, Air Deccan, Kingfisher Airlines, Spicejet, Jet Lite and Indigo.

There has also been an increase of 17.2 per cent in capacity, both with regard to flights per week and seats deployed between 2006 and 2007. In the case of flights it is 17.2 per cent and for seat deployment it is 18.9 per cent, as per statistics available with DONER.

For the proposed Greenfield airport at Pakyong in Sikkim, it was indicated that the DPR (Detailed Project Report) has been prepared and forwarded to the Planning Commission. The estimated cost of the project is likely to be Rs 320 crore. The Government of Sikkim has been allocated Rs 100 crore by the 12th Finance Commission for development of the airport. The Planning Commission has proposed sharing of cost on 1:1 basis between GBS of Ministry of Civil Aviation and resources from AAI.

For the Cheithu 'Greenfield' Airport in Nagaland, the consultants have submitted the interim report for the techno-economic feasibility study which is under examination by AAI and likely to be finalised soon. The techno-economic feasibility study for the proposed Greenfield airport at Banderdeva site at Itanagar has been prepared. (Express Travel World)