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Infrastructure and aviation - Business environment

The document discusses India's infrastructure development over three periods - pre-colonial, British rule, and post-independence. It notes developments like the Indus Valley civilization, Emperor Sher Shah's infrastructure projects, and railroads introduced under British rule. Post-independence, the Planning Commission defined infrastructure to include transportation and telecommunications sectors. The document then provides details on developments in various infrastructure sectors like roads, railroads, civil aviation, ports, and energy pipelines in India.

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SUBMITTED TO: Prof. SHALINI TANEJA SUBMITTED BY: VARUN KABARIA - 221061 NIKITA KHANDUJA - 221077 NITISH BAWEJA - 221080 PANKHURI MAHAJAN - 221086 PRABHAT TANEJA - 221090 RANJEEV DUTTA - 221115
• PRE-COLONIAL PERIOD (Upto 17th century) • BRITISH RULE • POST-INDEPENDENCE INDIA’s ECONOMIC HISTORY DIVIDED INTO 3 Eras
 Indus valley civilization flourished between 2800 B.C. and 1800 B.C.  Evidence of well planned Streets, Drainage systems and water supply  Indicative of their knowledge and understanding of Urban Planning  This included world’s first Urban Sanitation system  Infrastructure development explicitly recognized during Emperor Sher Shah’s rule (1540-1545)  The famous Grand Trunk Road linking the East and West extremities of India was completed during this period  Other major irrigation and road projects were undertaken during his regime
British rule brought with it major developments like  Railways  Telegraph Though, these contributed strictly and largely to their colonial expansion  Such an infrastructure laid foundation to India’s development story beginning in 1947
The planning commission broadly defines Infrastructure development as Transport and Telecommunications development Thus it includes the following:  Roads & Road Transport  Railways  Shipping  Ports  Civil aviation  Communications & Broadcasting
• The Union Budget 2012-13 stated that investment in infrastructure is to go up to Rs 50 lakh crores with half of the total investment expected from private sector. • More sectors proposed to be added as eligible sectors for Viability Gap Funding under the scheme- Support to PPP in infrastructure
• Tax free bonds of Rs 60000 crore to be allowed for financing infrastructure projects in 2012-13. • The Union Budget announced harmonised master list of infrastructure sector approved by the Government.
• National Manufacturing Policy announced with the objective of raising the share of manufacturing in GDP to 25 per cent and creating of 10 crore jobs.
• Coal India Limited was advised to sign fuel supply agreements with power plants, having long-term PPAs with DISCOMs and getting commissioned on or before 31 March 2015.
• External Commercial Borrowings (ECB) to be allowed to part finance Rupee debt of existing power projects
 The Union Budget 2012-13 proposed an increase of allocation of the Road Transport and Highways Ministry by 14 per cent to Rs 25360 crore . ECB proposed to be allowed for capital expenditure on the maintenance and operations of toll systems for roads and highways, if they are part of original project.
 The budget permitted direct import of Aviation Turbine Fuel for Indian carriers.  The budget also stated that the ECB is to be permitted for working capital requirement of airline industry for one year subject to a total ceiling of US $ 1 billion. Proposal to allow foreign airlines to participate upto 49 per cent in the equity of an air transport undertaking under active consideration of the government was also made.
“Expanding investment in infrastructure can play an important counter cyclical role. Projects and programmes [are] to be reviewed in the area of infrastructure development, including pure public private partnerships, to ensure that their implementation is expedited and does not suffer from [the] fund crunch.” Mr. Manmohan Singh, Indian Prime Minister,
 NETWORK OF ROADS IN INDIA - 33.2 lakh km.  On the basis of nature & surfacing - 1.Metalled (pucca)- 57% 2. Unmetalled (kuchcha) -43% On the basis of construction & maintenance – (a.) Golden Quadrilateral Super Highway : (i) NHDP Phase- I :- 5,846 km., six lane, CONNECTING-Delhi ,Mumbai, Chennai and Kolkata (ii) NHDP Phase- II :- 7300 km. * NS Corridors – Srinagar to Kanyakumari * EW Corridors – Silchar(Assam) to Porbandar(Gujarat) (iii) Port connectivity and other projects - 1,157 km. (iv) NHDP Phase – III:- 4,015km., 4 lane , -National Highway Authority of India (NHAI) is the implementing agency for NHDP programme. -NHAI is implement 4 laning of 603km. Special Accelerated Road Development Programme in the North Eastern Region (SARDP-NE) ,
(b.) NATIONAL HIGHWAYS -- As on March 31,2006 - 65,569 km. 2% of the total length of the road network CPWD constructs and maintains National Highways. 35%-single lane, 53%-2lane & 12%-4 lane or more. (c.) STATE HIGHWAYS -- 1.28 lakh km. 97%of the length of state highway is metalled. The State Highways are constructed and maintained by State Government. (d.) DISTRICTS ROADS – 4,70,000 km. Districts authorities constructs and maintain the District Roads (e.) OTHER ROADS - mostly kuchcha roads, 26,50,000 km. (f.) BORDER ROADS - Border Road Development Board , World’s highest Roads from Manali (H.P.) to Leh of Ladakh (J&K) ROAD DENSITY - The lowest density – 10 km.per 100 sq.km in J.&K. The highest density – 375 km.per 100 sq.km. in Kerala The national average of road density – 75 km. per 100 sq. km.
21 0 200000 400000 600000 800000 1000000 1200000 1400000 1600000 1800000 2000000 2200000 2400000 2600000 2800000 3000000 3200000 3400000 3600000 3800000 4000000 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 NO.OFVEHICLESREGISTERED As of June 30th 2009 more than 6.0 million vehicles were registered in Delhi, equivalent to the total number in Kolkata, Mumbai and Chennai. Two Wheelers Car/ Taxis Buses and Heavy Vehicles TSR Source: Transport Department, GNCTD
22 Cars and two-wheelers together drive less than 20% of its people -- and yet roads are choked. (Source: CSE) Courtesy: Flickers 22
23 The Car Oriented Infrastructure
• Population per sq. km in Delhi is less compared to other cities like Hong Kong, Seoul and Paris (City) which are more densely populated. • Road space as percentage of total land area is 21% in Delhi. – Present road length- 28,000 Kms with limited expansion possibilities. 30,100 24,500 24,448 13,930 9,340 10,400 Hong Kong Seoul Paris (City) Delhi (Urban) Delhi (Whole) Tokyo 21% 13% 13% 12% 11% 11% Delhi Tokyo Munich Hong Kong Paris Bangkok Road Space as Percentage of Total Area Delhi is developing urban sprawl Delhi Vs. Other World Cities World Cities - Population per sq. km. 24
Corridor Identification GNCTD commissioned study in 2005 which identified 43 corridors (575 km) with Peak Hour Peak Direction Traffic (PHPDT) exceeding 5,000, assuming the following exist: ― Metro Phase I & II ― Ambedkar Nagar-Delhi Gate BRT ― Phase I IRBT corridors (2 nos.) 25 PHPDT Length (in Kms) No. of Corridors Choice of Mode* >25,000 93 4 Metro 20,000-25,000 57 4 Elevated LRT 15,000-20,000 131 8 At grade LRT 10,000-15,000 179 13 At grade BRT / Elevated Monorail 5,000-10,000 115 14 At grade BRT Total 575 43 * Based on World Bank and other studies Demand-wise Number and Length of Corridors
26 • DIMTS, on behalf of Transport Department, commissioned “Transport Demand Forecast Study” in 2008. – To develop a Transport Demand Forecast Model and Identification of a Road cum Public Transport Network to meet the city demand by 2021 & beyond. – The study identified a total length of 583.4 kms for the development of different public transport systems: • Choice of mode depends mainly on demand level on a corridor, capacity of the mode and the available Road/Right Of Way (ROW). – Other considerations are the land-use along the corridor, the location of building lines, and the potential for increasing the ROW . Metro 148.2 kms BRT 394.9 kms Mono Rail 40.3 kms
BAKHTAWARPUR KARAWAL NAGAR CHILLA RAJOKARI KHAIRA GOPALNAGAR IBRAHIMPUR NAJAFGARH CHHAWLA DILSHAD GARDEN AIRPORT ISBT BADARPUR TO GURGAON DELHI BORDER (BAHADURGARH) KANJHAWALA BAWANA TO NOIDA ANAND VIHAR ISBT (TO VAISHALI) GOKALPURI MUKUNDPUR ROHINI SEC-21 MUNDKA DABRI MOD DWARKA JASOLA AMBEDKAR NAGAR VASANT KUNJ MEHRAULI KAPASHERA GULABIBAGH IG STADIUM DHAULAKUAN CENTRAL SECTT NARELA RAJEEV CHOWK KALINDI KUNJ JASOLA PUTHKHURD ARJANGARH (TO GURGAON) KONDALI METRO MONORAIL BRT INTERCHANGE Recommended Integrated Public Transport Network Approximate Cost – Rs. 462.7 Billion
Mode Length (Kms) Budget (in Rs.) Metro – Phase I 65.1 Kms Rs. 105. 7 billion Metro – Phase II 128.0 Kms Rs. 190.0 billion* BRT – First Corridor 14.5 Kms Rs. 2.0 billion 28 * Inclusive of Civil work of Airport Express line. Source: Delhi Metro Investment focus on one mode of public transport and minor investment in other modes.
29 Automated Vehicle Location System Automated Fare Collection System Intelligent Signaling System Parking Information System Real-Time Traffic Information System Real-time Monitoring System Interactive journey planner for all modes Car Sharing Cycle Sharing Systems
30
31 <TRAKO PIS Chirag Delhi> 419DN-2, 522UP-6, 419UP-7, 419ACUP-14, 423ACDN – 28 mins Info by DIMTS Mobile user needs to send simple message: TRAKO<SPACE>PIS<SPACE>BUS STOP NAME to 54545 (You will instantly receive a SMS response: Next Bus at Bus Stop for Route Number expected in ‘X’ minutes)
32www.dimts.in
Automated Fare Collection System Delhi Government is also planning to create an Integrated Multi-Modal Ticketing system, comprising DTC, Private Buses and Delhi Metro. DMRC System Central System (CCHS) Wi-FI Depot Computer System Depot Computer System DTC Private Buses Wi-FI Delhi Transport Corporation 33
 AFCS implemented on Dwarka Circular Sewa, inter-connecting key destinations in Dwarka sub-city such as metro stations, shopping centres, schools…………  The system is operational in 6 low- floor A/C buses. 34
35 • Transport Department is planning to cover Autorickshaws and Taxis under the ambit of a Vehicle Tracking System. • A separate call centre will be setup for booking and the despatch of autorickshaws. • A similar service will be launched in other cities including Ahmedabad, Pune, Chandigarh and Chennai. Transport Department, GNCTD will install GPS-based Vehicle Tracking System in all 55,000 auto rickshaw in the city and will establish a call-centre facility.
 In 1947 rail network of about 53000 km  Added only 11000 km of network in last 65 years  Modifications like- -Gauge changing -Electrification -Computerization -Double tracks
 Investment of Rs. 57630 cr the year 2011- 12 for the development, highest ever by Indian railways in any financial year -Target of laying 1075 km of new lines in 2012 -800 km of gauge conversion -700 km of Doubling of lines
 High speed rail travel  Raising the speed of regular passenger trains from 100-130 khph to 160-200 kmph  To develop 50 world class stations which can be recognized internationally  Segregating passenger and freight tracks completely
 Mega infrastructure project of USD 90 billion  To connect Delhi & Mumbai through road and railway network of 1483 km  Delhi, U.P., Haryana, Rajasthan, Gujarat, Maharashtra this states will be connected to form a corridor of international standard.
1. The total length of railway network as on March, 2002 was 63028 km. (i) Broad Gauge (1.67 metre) - 45622 km. (70%) (ii) Metre Gauge (1 metre) - 14364 km. (24.6%) (iii) Narrow Gauge(0.77 metre) - 3136 km. (5.36%) As on March, 1951 – 53596 km. - 18% increase 2. Additional Lines on the already existing busy routes– total running track had increased from 59,315 km. to 1,07,969 km. in 2001. 3. Electrification of route – By March,2006 the Indian railways had got 17500 km. of railway route electrified.(26% of total route) Purposes of Electrification –(i) relieves railways from steam engines. (ii) ensure more speedy movement. (iii) Clean and pollution free travel. 4. Container Service - Provides door to door service for goods & commodities by CCI. 5. Computerised reservation & more and more coaches and sleepers. 6. METRO Railway - Kolkata, Delhi, Mumbai & Chennai 7. Super fast Trains
Pipelines have become a major means of transport and are used in transporting crude oil, petroleum product and natural gas from the oil and natural gas fields to refineries, fertiliser factories and big thermal power generation plants. Major categories of pipeline transportation in India :- 1. upper Assam Oil fields to Kanpur via Guwahati, Barauni and Allahabad 2. Salaya (Gujarat) to Jalandhar (Punjab) via Viramgam, Mathura, Delhi and Panipat. 3. Hazira (Gujarat) to Jagdishpur (U.P.) via Bijapur (M.P.) –the longest pipeline in India -1700km. 4. Mumbai HIGH with Mumbai – Pune PROPOSED PIPELINES – (I) Between Kandla and Panipat (II) Between Kandla and Bina (III) Between Mumbai and Manmad (IV) Between Vishakhapatanam to Vijaiwada (V) between Mangalore to Chennai via Bangalore
India has a large number of perennial rivers and a very long coastline of 6100 km. Types of waterways:- (a.) Inland water transport (b) Ocean water transport National Waterways :- 1.The Ganga river - Allahabad to Haldia - 1620 km. 2. The Brahmaputra river - Sadiya TO Dhubri - 891 km. 3. The West Coast Canal - Kollam to Kottapuram - 14 km. 4. The Champakara Canal – Kerala -13 km. 5. Udagmandalam Canal - Kerala -22 km. Major Sea Ports :- At the time of Independence - 5 sea ports Sea ports at West Coast Seaports at East Coast 1. Kandla 1. Tuticorin 2. Mumbai 2. Chennai 3. Nhova Sheva (Jawahar Lal Nehru) 3. Ennore 4.Mormugao 4. Vishakhapatnam 5. Mangalore 5. Paradip 6. Kochi 6. Haldia
 Air travel is the fastest, most comfortable and prestigious mode of transport.  Civil Aviation Department of controls and supervises the activities of airlines and gives guidelines for safe operations of the airlines.  AIR SERVICES :- 1. Air India - 26 Air Craft 2. Indian Airlines - 54 Air Craft 3. Pawan Hans Helicopters 4. Private Air Lines (Scheduled & Non-scheduled)-70 International Airports :- 14 1.Delhi 8.Kochi 2.Mumbai 9.Hyderabad 3.Chennai 10. Guwahati 4. Kolkata 11. Bangalore 5. Amritsar 12. Thiruvananthapuram 6. Ahmedabad 13. Srinagar 7. Panaji 14. Pune Airports are managed by Airports Authority of India.
Cargo airlines :Blue Dart Aviation ltd is Operating scheduled cargo services in the country
 Allahabad  Saidiya  Kollam  Bhadrachalam  Mangalgadi
Major ports of India
 A project to upgrade, rehabilitate and widen major highways to a higher standard  Implemented under the leadership of Atal Bihari Vajpayee  Managed by National Highways Authority of India (NHAI)  Proposed investment for this project amounts to US $ 71 billion  This project will be completed in 7 phases  Most important of these being PHASE I and II  PHASE I : Golden Quadrilateral project  PHASE II : North-South & East-West corridor
 An autonomous agency of Government of India  NHAI was created through the promulgation of the National Highways Authority of India Act, 1988  The authority was made autonomous in 1995  Responsible for development, maintenance, management and operation of National highways totaling around 76,818 KM INDIAN ROAD NETWORK CLASS LENGTH National Highways (Already 4/6 laned) 16,000 KM National Highways (Being laned) 25,000 KM State Highways 1,54,522 KM Major and other district roads 2,577,396 KM Rural & Other roads 1,433,577 KM Total (Approx.) 4,245,429 KM
STATUS
 Represents the PHASE I of the NHDP, launched in 2001  Launched by Shri Atal Bihari Vajpayee, it was planned to complete in January, 2012  It is highway network connecting many of the major industrial, agricultural and cultural centers of India  This project seeks to improve the connectivity of four major cities in India  It is the largest highway project in India and 5th longest in the world  GQ project would greatly impact urban and rural growth of Indian manufacturing  GQ project has led to improvements in both urban and rural areas of non-nodal districts located 0-10 KM from the GQ
 Represents the second phase of the NHDP  Consists of building 7300 KMs of 4/6 lane expressways  It connects Srinagar, Kanyakumari, Porbandar and Silchar  The proposed cost for this project is Rs. 42,000 crores As of date : - October 31, 2013 Segment NS – EW Corridor Total Length 7,142 KM Length Completed 6,177 KM Under Implementation 593 KM Length to be Awarded 372 KM % Completed 86.48 % STATUS
The projected economic benefits of these highway projects are:  Establishing faster transport networks between major cities and ports  Providing an impetus to smoother movement of products and people within India  Enabling industrial and job development in smaller towns through access to markets  Providing opportunities for farmers, through better transportation of products from the agricultural hinterland to major cities and ports for export, through lesser wastage and spoils  Driving economic growth directly, through construction as well as through indirect demand for cement, steel and other construction materials  Giving an impetus to Truck transport throughout India
PREMISE OF THE CASE: Large infrastructure projects have major implications for achieving low-carbon development goals
 DFC project signifies a major transition in the freight transport sector through increased sharing of rails, which are • More energy efficient • Environment friendly • Less Carbon intensive mode of transport  3 scenarios are taken into consideration here • Business-as-Usual (Without DFC) • Business-as-Usual (With DFC) • Low Carbon (With DFC)  Here Low carbon path development assumes a number of supply-side interventions that lead to further improvements in energy efficiency as well as decarbonisation of electricity at the generation stage. This is different from the BAU scenarios
 DEC 1910: Team of mechanics and aviators, led by Capt. WG Windham land in India.  Show case their airplanes for business opportunities  Exhibition at Exhibition Grounds in Allahabad
YEAR: 1912 ROUTE: Karachi to New Delhi Indian State Air Services and Imperial Air
 1932: JRD Tata formed Tata Airlines  JRD Tata was the first Indian to get A license  First Indian commercial carrier to transport mail and passengers within India  The company was based out of a small hut with a palm thatched roof at Juhu Airstrip in Bombay (Mumbai)
 JRD flew the first leg of the inaugural Karachi-Madras (Chennai) journey himself, taking mail from Karachi to Bombay via Ahmedabad using a single-engine De Havilland Puss Moth  In its first year, Tata Airlines flew 160,000 miles, carrying 155 passengers and more than 10 tonnes of mail.
 The Indian Air Force was established in British India as an auxiliary air force of the Royal Air Force  The IAF commissioned its first squadron , No.1 Squadron, with four Westland Wapiti Biplanes and five Indian pilots in 1933
 1924: Construction of civil airports began in India. Construction began at Dum Dum in Calcutta, Bamrauli in Allahabad and Gilbert Hill in Bombay  1937: The Aircraft Act, 1934 was promulgated  1940: Hindustan Aeronautics Limited (HAL) was set up by Walchand Hirachand in association with the then Mysore Government at Bangalore.  1941: India’s first aircraft, the Harlow trainer was rolled out for test flight in July 1941
 1946: Tata Airline becomes Air India  At the time of independence, nine air transport companies were carrying both air cargo and passengers.  1948: Government of India takes 49% of the company  Government of India established a joint sector company, Air India International Ltd in collaboration with Air India (earlier Tata Airline) with a capital of Rs 2 crore and a fleet of three Lockheed Constellation Aircrafts
 All airlines nationalised  Eight formerly independent domestic airlines: Deccan Airways, Airways India, Bharat Airways, Himalyan Aviation, Kalinga Air Lines, Indian National Airways, Air India, Air Services of India were merged.  Air India International took over the international traffic  Indian Airlines Corporation handled the domestic operations
 1953: Civil helicopters introduced for the first time in the country  The commercial use of helicopters in India was limited to small Aviation companies who were involved in communication and crop spraying roles.  1985: Pawan Hans Helicopters Limited (PHHL) and Indira Gandhi Rashtriya Uran Academy (IGRUA) in Fursatganj, Rai Bareli in Uttar Pradesh for training of pilots were established
 The National Airports Authority [NAA] established in 1986 for the management of all domestic airports and Air Traffic Management of the entire Indian airspace and adjoining oceanic areas
 The BCAS was under the Ministry of Civil Aviation and set up as a sequel to the Kanishka Tragedy in June 1985. The main responsibility of BCAS are lay down standards and measures in respect of security of civil flights at international and domestic airports in India
 http://www.apaoindia.com/?page_id=185  http://dgca.nic.in/  http://www.civilaviation.gov.in/  http://www.bharat- rakshak.com/IAF/History/Aircraft/AviationIndia.pdf  http://www.bcasindia.nic.in/aboutus/aboutus.html
POLICIES  Liberalization - Private Players  Open Sky  Direct import of ATF - Regulation  FDI – domestic Services Sector  Airports control - Airports Authority of India (AAI)  Green Field Airport
 The Air Corporation Act, 1953 repealed  Opening up of the domestic sector  Disinvestment of the two public sector airlines  New privately owned domestic airlines  Open Sky  Allow foreign airline of any country or ownership to land at any port on any number of occasions and with unlimited seat capacity.  Foreign Direct Investment  Up To 49% Of Foreign Equity & 100% Of NRI investment is allowed Pertaining to the Domestic Air Transport Services  Private Carriers permitted to operate scheduled services – 75% share in domestic aviation.
 Entry of low cost carriers  City side development of non-metro airports  Allowing Indian carriers to compete on international routes  Reduction in Landing charges.  Fleet expansion plans of Air India  Restructuring of Delhi and Mumbai airport and development of Greenfield airports at Bangalore and Hyderabad undertaken.  Up gradation/ expansion/ development of airports undertaken depending upon traffic potential, requirement of airline operators and need of air passengers.  With the liberalization of the Indian aviation sector, aviation industry in India has undergone a rapid transformation. Indian aviation industry is now dominated by privately owned full service airlines and low cost carriers.
 1991, September 20: Sahara Airlines started its operations.  1993, May: Jet Airways started its operations.  1995: India’s six private airlines accounted for more than 10% of domestic traffic. Many foreign airlines started providing international services. In 1995, 42 airlines operated air services to, from, and through India.  1995, April 1: Airport Authority of India was constituted by merging the International Airport Authority of India with National Airports Authority.  1997: Policy on Airport Infrastructure of India was developed for the use and development of airport infrastructure.
 1999, June 10: CIAL Airport was the first airport in India which was built with public-private participation and was made operational. The process for development of CIAL as a private airport began in 1993.  2000, October 2: Sahara Airlines was rebranded as Air Sahara.  2003: Entry of low cost carriers. Air Deccan started its services  2004: Government approved setting up of private Greenfield airports at Hyderabad and Bangalore.  2004, June: Low Cost Carrier – GoAir started it operations.  2004, December: Indian Scheduled carriers with a minimum of 5 years of continuous operations and a minimum fleet size of 20 aircraft, were permitted to operate scheduled services to international destinations.
 2005: Indian Airlines was rebranded as Indian. The Government designated Air India, Indian Airlines, Jet Airways and Air Sahara to operate international services.  2005, May: Kingfisher Airlines (Full Service Carrier) and Spice Jet (Low Cost Carrier) commenced operations.  2006, August: Low Cost Carrier – Indigo started its operations.  2006: The government approved the restructuring and modernisation of Mumbai and Delhi brownfield airports through the public-private partnership model.  2007: The Regional Airlines Policy was announced wherein licenses were given for operation of airlines within a particular region.
 2008, April 24: The path breaking Greenfield Airport Policy of the Government was announced.  2008, August: Simplify Deccan was renamed as Kingfisher Red.  2009, May 12: AERA was established to regulate the economic aspects of airports. It is an autonomous body set up by an Act of Parliament.  2010: Airport Economic Regulatory Authority Appellate Tribunal (AERAAT) was established.  At present, India is the 9th largest aviation market in the world with 90 operational airports, 1,180 aircrafts, 303 helicopters, 11 operational scheduled airlines and 133 non-scheduled operators. It is envisaged that by year 2020, India will be among top 3 Civil Aviation Markets in the world and will handle about 300 million passengers.
 Year Passenger Carried (in millions) Domestic International Total 1990-91 7.5 6.3 13.8 1995-96 12.2 9.4 21.6 2003-04 15.7 14.6 30.3 2010-11 53.9 37.9 91.8 Source: DGCA, AAI; Analysis: MoCA
 Rising domestic Gross Domestic Product (GDP)  GDP - 5.7% in the period 90-91 to 2003-2004 which then rose to 8.6% during 2004-05 to 2010-11.  Growing economic activity resulted in increase in business travel and greater leisure travel  Expanding middle-income group  middle income group population in 2010 stood at 160 million individuals i.e. 13.3% of the total population, which is expected to rise to 547 million in 2025 (i.e. 37.2% of the total population)  Demographic Dividend  62% of the population is in the working age group of 15-60 years - indicating a larger employee base, greater business travel and greater economic activity.
 Rising Urban Population  Significant Market Developments Source: Spicejet Annual Report 2009 0 20 40 60 80 100 120 Column1 LCC FCS
 Low Cost Carrier (LCC) model which made air travel affordable for common man got established firmly in the domestic market since 2004. This stimulated the pent up demand for air travel.  The domestic traffic is rapidly shifting towards the LCC model. Market sources suggest that this has crossed 67% during 2011-12.  This leads us to believe that Low Cost Operations in a price sensitive market like India appear to be a more sustainable business model
 Investments in Airport and related infrastructure  Total investment made by private airport operators in the last five years was to the tune of Rs 30,000 crores spread across Greenfield development of Hyderabad and Bengaluru international airports and modernization of Delhi and Mumbai international airports  Growing tourism  2001 to 2010-the average annual growth rate of foreign tourist arrivals in to India and Indian National departures from India grew by 9.2% and 11.5% respectively.  The number of foreign tourist arrivals in India stood at 5.6 Million in the year 2010 as against 3.46 Million in 2004 and 2.54 Million in 2001. Similarly, the number of Indian National departures from India stood at 12.1 Million in 2010 as against 6.21 Million in 2004 and 4.56 Million in 2001.
Untapped market potential Air traffic density in India using this measure is very low at 72 as compared to China (282), which is 4 times higher; Brazil (231), which is 3 times higher etc. indicates the untapped market potential. Global integration of businesses Greater economic activity and the consequent greater integration of businesses globally would mean greater business travellers across national boundaries. Also, the growing trend of outbound Mergers and Acquisitions (M & A) and is set to grow further in future implies greater business related travel
 Airlines in India are having financial difficulties.  Even Jet Airways has seen its market share and profits decline and stock price plummet by 40% since 2005.  Inability of the airlines to reduce costs  “Irrational” pricing that set in after the advent of LCCs. They have chased market share, i.e., revenue maximization and forced the incumbents to match their low prices.  OUTCOMES  Either some of them go bust in a market shake-out or they merge/get acquired by other airlines or business groups.
These two national carriers enjoyed monopoly power in the industry until the Air Corporations Act was repealed.  intense competition from private carriers - main reason for steep decline in their market share and profits.  Indian Airlines - monopoly on domestic services until 1994, market share decline from 100% to 17% since.  Air India and India Airlines merged in 2007 (NACIL was formed) in order to recover their losses and work efficiently  PROBLEMS- no clear ownership and mismanagement by authority  poor execution of plan and improper strategy along with massive misuse of funds
 Sub-optimal aircraft utilisation: Air India’s fleet utilisation is very poor with only around 100 operational aircraft out of a total registered fleet of 127 aircraft  Fleet issues: The B777-200LR, B747-400 and the A319 aircraft are poorly matched with the mission requirements of its international and domestic routes  Business model needs to be reworked: Air India requires a comprehensive review of its business model. At present there are fundamental weaknesses in each of its key domains.  Government intervention: In addition to these huge challenges, the management of Air India has to deal with excessive intervention by the Ministry of Civil Aviation and other ministries
 After the liberalization of Indian Economy in 1993, two new airlines, Jet Airways and Air Sahara entered in the domestic market.  15 years later, in 2008, Air Sahara was acquired by Jet Airways and renamed as JetLite.  Now Jet Airways and JetLite together share 23.8 % of the domestic market in India and this airline remained the market leader in Indian Domestic Sector for many years until recently toppled by Indigo to number 2 spot.  It is basically a full-service carrier, but also offers low-cost services under the name of JetKonnect.
 India's first low-cost carrier, Air Deccan, reported a $43 million loss for the fourth quarter ending June 2007.  To keep afloat, Air Deccan sold 26% of stake in May 2007 at $136 million to liquor baron Vijay Mallya's then two-year- old Kingfisher Airlines  This stake was later increased to 46%. The business models of these two airlines seemed to be as diametrically opposite - ran as separate entities. Kingfisher and Kingfisher Red  plan to improve performance and save money by sharing facilities and staff.
 The King of Good Times, liquor barren, Vijay Mallya, gifted this airline to his son on his 18th birthday as a birthday gift in 2005, it was deemed that the passengers would fly in the sky with a style.  For next six years, it indeed treated its customers in style. Even the airlines served on-board meals on its low-cost wing Kingfisher Red, against the trend.  the dream collapsed somewhere in the sky and today, the aviation regulator has cancelled the flying license of the Kingfisher Airlines.  Due to its poor financial health, the airline is unable to pay its dues to the banks and salaries to the employees  http://www.solobackpacker.com/2012/11/09/an- overview-of-domestic-airlines-in-india/
Indigo uses a fleet of 150 aircrafts from AIRBUS – A 320 The advantage of using a single type of aircraft shows in their profit making ability in this competitive aviation sector. Jet uses a mix of wide bodied boeing 777 and narrw bodied 737’s as well as slightly wider Airbus A330’s
Infrastructure and aviation - Business environment
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Infrastructure and aviation - Business environment

  • 1.
    SUBMITTED TO: Prof. SHALINITANEJA SUBMITTED BY: VARUN KABARIA - 221061 NIKITA KHANDUJA - 221077 NITISH BAWEJA - 221080 PANKHURI MAHAJAN - 221086 PRABHAT TANEJA - 221090 RANJEEV DUTTA - 221115
  • 2.
    • PRE-COLONIAL PERIOD(Upto 17th century) • BRITISH RULE • POST-INDEPENDENCE INDIA’s ECONOMIC HISTORY DIVIDED INTO 3 Eras
  • 4.
     Indus valleycivilization flourished between 2800 B.C. and 1800 B.C.  Evidence of well planned Streets, Drainage systems and water supply  Indicative of their knowledge and understanding of Urban Planning  This included world’s first Urban Sanitation system  Infrastructure development explicitly recognized during Emperor Sher Shah’s rule (1540-1545)  The famous Grand Trunk Road linking the East and West extremities of India was completed during this period  Other major irrigation and road projects were undertaken during his regime
  • 5.
    British rule broughtwith it major developments like  Railways  Telegraph Though, these contributed strictly and largely to their colonial expansion  Such an infrastructure laid foundation to India’s development story beginning in 1947
  • 6.
    The planning commissionbroadly defines Infrastructure development as Transport and Telecommunications development Thus it includes the following:  Roads & Road Transport  Railways  Shipping  Ports  Civil aviation  Communications & Broadcasting
  • 7.
    • The UnionBudget 2012-13 stated that investment in infrastructure is to go up to Rs 50 lakh crores with half of the total investment expected from private sector. • More sectors proposed to be added as eligible sectors for Viability Gap Funding under the scheme- Support to PPP in infrastructure
  • 8.
    • Tax freebonds of Rs 60000 crore to be allowed for financing infrastructure projects in 2012-13. • The Union Budget announced harmonised master list of infrastructure sector approved by the Government.
  • 9.
    • National Manufacturing Policyannounced with the objective of raising the share of manufacturing in GDP to 25 per cent and creating of 10 crore jobs.
  • 10.
    • Coal IndiaLimited was advised to sign fuel supply agreements with power plants, having long-term PPAs with DISCOMs and getting commissioned on or before 31 March 2015.
  • 11.
    • External CommercialBorrowings (ECB) to be allowed to part finance Rupee debt of existing power projects
  • 13.
     The UnionBudget 2012-13 proposed an increase of allocation of the Road Transport and Highways Ministry by 14 per cent to Rs 25360 crore . ECB proposed to be allowed for capital expenditure on the maintenance and operations of toll systems for roads and highways, if they are part of original project.
  • 15.
     The budgetpermitted direct import of Aviation Turbine Fuel for Indian carriers.  The budget also stated that the ECB is to be permitted for working capital requirement of airline industry for one year subject to a total ceiling of US $ 1 billion. Proposal to allow foreign airlines to participate upto 49 per cent in the equity of an air transport undertaking under active consideration of the government was also made.
  • 17.
    “Expanding investment ininfrastructure can play an important counter cyclical role. Projects and programmes [are] to be reviewed in the area of infrastructure development, including pure public private partnerships, to ensure that their implementation is expedited and does not suffer from [the] fund crunch.” Mr. Manmohan Singh, Indian Prime Minister,
  • 18.
     NETWORK OFROADS IN INDIA - 33.2 lakh km.  On the basis of nature & surfacing - 1.Metalled (pucca)- 57% 2. Unmetalled (kuchcha) -43% On the basis of construction & maintenance – (a.) Golden Quadrilateral Super Highway : (i) NHDP Phase- I :- 5,846 km., six lane, CONNECTING-Delhi ,Mumbai, Chennai and Kolkata (ii) NHDP Phase- II :- 7300 km. * NS Corridors – Srinagar to Kanyakumari * EW Corridors – Silchar(Assam) to Porbandar(Gujarat) (iii) Port connectivity and other projects - 1,157 km. (iv) NHDP Phase – III:- 4,015km., 4 lane , -National Highway Authority of India (NHAI) is the implementing agency for NHDP programme. -NHAI is implement 4 laning of 603km. Special Accelerated Road Development Programme in the North Eastern Region (SARDP-NE) ,
  • 20.
    (b.) NATIONAL HIGHWAYS-- As on March 31,2006 - 65,569 km. 2% of the total length of the road network CPWD constructs and maintains National Highways. 35%-single lane, 53%-2lane & 12%-4 lane or more. (c.) STATE HIGHWAYS -- 1.28 lakh km. 97%of the length of state highway is metalled. The State Highways are constructed and maintained by State Government. (d.) DISTRICTS ROADS – 4,70,000 km. Districts authorities constructs and maintain the District Roads (e.) OTHER ROADS - mostly kuchcha roads, 26,50,000 km. (f.) BORDER ROADS - Border Road Development Board , World’s highest Roads from Manali (H.P.) to Leh of Ladakh (J&K) ROAD DENSITY - The lowest density – 10 km.per 100 sq.km in J.&K. The highest density – 375 km.per 100 sq.km. in Kerala The national average of road density – 75 km. per 100 sq. km.
  • 21.
  • 22.
    22 Cars and two-wheelerstogether drive less than 20% of its people -- and yet roads are choked. (Source: CSE) Courtesy: Flickers 22
  • 23.
    23 The Car OrientedInfrastructure
  • 24.
    • Population persq. km in Delhi is less compared to other cities like Hong Kong, Seoul and Paris (City) which are more densely populated. • Road space as percentage of total land area is 21% in Delhi. – Present road length- 28,000 Kms with limited expansion possibilities. 30,100 24,500 24,448 13,930 9,340 10,400 Hong Kong Seoul Paris (City) Delhi (Urban) Delhi (Whole) Tokyo 21% 13% 13% 12% 11% 11% Delhi Tokyo Munich Hong Kong Paris Bangkok Road Space as Percentage of Total Area Delhi is developing urban sprawl Delhi Vs. Other World Cities World Cities - Population per sq. km. 24
  • 25.
    Corridor Identification GNCTD commissionedstudy in 2005 which identified 43 corridors (575 km) with Peak Hour Peak Direction Traffic (PHPDT) exceeding 5,000, assuming the following exist: ― Metro Phase I & II ― Ambedkar Nagar-Delhi Gate BRT ― Phase I IRBT corridors (2 nos.) 25 PHPDT Length (in Kms) No. of Corridors Choice of Mode* >25,000 93 4 Metro 20,000-25,000 57 4 Elevated LRT 15,000-20,000 131 8 At grade LRT 10,000-15,000 179 13 At grade BRT / Elevated Monorail 5,000-10,000 115 14 At grade BRT Total 575 43 * Based on World Bank and other studies Demand-wise Number and Length of Corridors
  • 26.
    26 • DIMTS, onbehalf of Transport Department, commissioned “Transport Demand Forecast Study” in 2008. – To develop a Transport Demand Forecast Model and Identification of a Road cum Public Transport Network to meet the city demand by 2021 & beyond. – The study identified a total length of 583.4 kms for the development of different public transport systems: • Choice of mode depends mainly on demand level on a corridor, capacity of the mode and the available Road/Right Of Way (ROW). – Other considerations are the land-use along the corridor, the location of building lines, and the potential for increasing the ROW . Metro 148.2 kms BRT 394.9 kms Mono Rail 40.3 kms
  • 27.
    BAKHTAWARPUR KARAWAL NAGAR CHILLA RAJOKARI KHAIRA GOPALNAGAR IBRAHIMPUR NAJAFGARH CHHAWLA DILSHAD GARDEN AIRPORT ISBT BADARPUR TOGURGAON DELHI BORDER (BAHADURGARH) KANJHAWALA BAWANA TO NOIDA ANAND VIHAR ISBT (TO VAISHALI) GOKALPURI MUKUNDPUR ROHINI SEC-21 MUNDKA DABRI MOD DWARKA JASOLA AMBEDKAR NAGAR VASANT KUNJ MEHRAULI KAPASHERA GULABIBAGH IG STADIUM DHAULAKUAN CENTRAL SECTT NARELA RAJEEV CHOWK KALINDI KUNJ JASOLA PUTHKHURD ARJANGARH (TO GURGAON) KONDALI METRO MONORAIL BRT INTERCHANGE Recommended Integrated Public Transport Network Approximate Cost – Rs. 462.7 Billion
  • 28.
    Mode Length (Kms)Budget (in Rs.) Metro – Phase I 65.1 Kms Rs. 105. 7 billion Metro – Phase II 128.0 Kms Rs. 190.0 billion* BRT – First Corridor 14.5 Kms Rs. 2.0 billion 28 * Inclusive of Civil work of Airport Express line. Source: Delhi Metro Investment focus on one mode of public transport and minor investment in other modes.
  • 29.
  • 30.
  • 31.
    31 <TRAKO PIS ChiragDelhi> 419DN-2, 522UP-6, 419UP-7, 419ACUP-14, 423ACDN – 28 mins Info by DIMTS Mobile user needs to send simple message: TRAKO<SPACE>PIS<SPACE>BUS STOP NAME to 54545 (You will instantly receive a SMS response: Next Bus at Bus Stop for Route Number expected in ‘X’ minutes)
  • 32.
  • 33.
    Automated Fare CollectionSystem Delhi Government is also planning to create an Integrated Multi-Modal Ticketing system, comprising DTC, Private Buses and Delhi Metro. DMRC System Central System (CCHS) Wi-FI Depot Computer System Depot Computer System DTC Private Buses Wi-FI Delhi Transport Corporation 33
  • 34.
     AFCS implementedon Dwarka Circular Sewa, inter-connecting key destinations in Dwarka sub-city such as metro stations, shopping centres, schools…………  The system is operational in 6 low- floor A/C buses. 34
  • 35.
    35 • Transport Departmentis planning to cover Autorickshaws and Taxis under the ambit of a Vehicle Tracking System. • A separate call centre will be setup for booking and the despatch of autorickshaws. • A similar service will be launched in other cities including Ahmedabad, Pune, Chandigarh and Chennai. Transport Department, GNCTD will install GPS-based Vehicle Tracking System in all 55,000 auto rickshaw in the city and will establish a call-centre facility.
  • 38.
     In 1947rail network of about 53000 km  Added only 11000 km of network in last 65 years  Modifications like- -Gauge changing -Electrification -Computerization -Double tracks
  • 40.
     Investment ofRs. 57630 cr the year 2011- 12 for the development, highest ever by Indian railways in any financial year -Target of laying 1075 km of new lines in 2012 -800 km of gauge conversion -700 km of Doubling of lines
  • 41.
     High speedrail travel  Raising the speed of regular passenger trains from 100-130 khph to 160-200 kmph  To develop 50 world class stations which can be recognized internationally  Segregating passenger and freight tracks completely
  • 42.
     Mega infrastructureproject of USD 90 billion  To connect Delhi & Mumbai through road and railway network of 1483 km  Delhi, U.P., Haryana, Rajasthan, Gujarat, Maharashtra this states will be connected to form a corridor of international standard.
  • 43.
    1. The totallength of railway network as on March, 2002 was 63028 km. (i) Broad Gauge (1.67 metre) - 45622 km. (70%) (ii) Metre Gauge (1 metre) - 14364 km. (24.6%) (iii) Narrow Gauge(0.77 metre) - 3136 km. (5.36%) As on March, 1951 – 53596 km. - 18% increase 2. Additional Lines on the already existing busy routes– total running track had increased from 59,315 km. to 1,07,969 km. in 2001. 3. Electrification of route – By March,2006 the Indian railways had got 17500 km. of railway route electrified.(26% of total route) Purposes of Electrification –(i) relieves railways from steam engines. (ii) ensure more speedy movement. (iii) Clean and pollution free travel. 4. Container Service - Provides door to door service for goods & commodities by CCI. 5. Computerised reservation & more and more coaches and sleepers. 6. METRO Railway - Kolkata, Delhi, Mumbai & Chennai 7. Super fast Trains
  • 44.
    Pipelines have becomea major means of transport and are used in transporting crude oil, petroleum product and natural gas from the oil and natural gas fields to refineries, fertiliser factories and big thermal power generation plants. Major categories of pipeline transportation in India :- 1. upper Assam Oil fields to Kanpur via Guwahati, Barauni and Allahabad 2. Salaya (Gujarat) to Jalandhar (Punjab) via Viramgam, Mathura, Delhi and Panipat. 3. Hazira (Gujarat) to Jagdishpur (U.P.) via Bijapur (M.P.) –the longest pipeline in India -1700km. 4. Mumbai HIGH with Mumbai – Pune PROPOSED PIPELINES – (I) Between Kandla and Panipat (II) Between Kandla and Bina (III) Between Mumbai and Manmad (IV) Between Vishakhapatanam to Vijaiwada (V) between Mangalore to Chennai via Bangalore
  • 46.
    India has alarge number of perennial rivers and a very long coastline of 6100 km. Types of waterways:- (a.) Inland water transport (b) Ocean water transport National Waterways :- 1.The Ganga river - Allahabad to Haldia - 1620 km. 2. The Brahmaputra river - Sadiya TO Dhubri - 891 km. 3. The West Coast Canal - Kollam to Kottapuram - 14 km. 4. The Champakara Canal – Kerala -13 km. 5. Udagmandalam Canal - Kerala -22 km. Major Sea Ports :- At the time of Independence - 5 sea ports Sea ports at West Coast Seaports at East Coast 1. Kandla 1. Tuticorin 2. Mumbai 2. Chennai 3. Nhova Sheva (Jawahar Lal Nehru) 3. Ennore 4.Mormugao 4. Vishakhapatnam 5. Mangalore 5. Paradip 6. Kochi 6. Haldia
  • 48.
     Air travelis the fastest, most comfortable and prestigious mode of transport.  Civil Aviation Department of controls and supervises the activities of airlines and gives guidelines for safe operations of the airlines.  AIR SERVICES :- 1. Air India - 26 Air Craft 2. Indian Airlines - 54 Air Craft 3. Pawan Hans Helicopters 4. Private Air Lines (Scheduled & Non-scheduled)-70 International Airports :- 14 1.Delhi 8.Kochi 2.Mumbai 9.Hyderabad 3.Chennai 10. Guwahati 4. Kolkata 11. Bangalore 5. Amritsar 12. Thiruvananthapuram 6. Ahmedabad 13. Srinagar 7. Panaji 14. Pune Airports are managed by Airports Authority of India.
  • 50.
    Cargo airlines :BlueDart Aviation ltd is Operating scheduled cargo services in the country
  • 53.
     Allahabad  Saidiya Kollam  Bhadrachalam  Mangalgadi
  • 54.
  • 55.
     A projectto upgrade, rehabilitate and widen major highways to a higher standard  Implemented under the leadership of Atal Bihari Vajpayee  Managed by National Highways Authority of India (NHAI)  Proposed investment for this project amounts to US $ 71 billion  This project will be completed in 7 phases  Most important of these being PHASE I and II  PHASE I : Golden Quadrilateral project  PHASE II : North-South & East-West corridor
  • 56.
     An autonomousagency of Government of India  NHAI was created through the promulgation of the National Highways Authority of India Act, 1988  The authority was made autonomous in 1995  Responsible for development, maintenance, management and operation of National highways totaling around 76,818 KM INDIAN ROAD NETWORK CLASS LENGTH National Highways (Already 4/6 laned) 16,000 KM National Highways (Being laned) 25,000 KM State Highways 1,54,522 KM Major and other district roads 2,577,396 KM Rural & Other roads 1,433,577 KM Total (Approx.) 4,245,429 KM
  • 58.
  • 59.
     Represents thePHASE I of the NHDP, launched in 2001  Launched by Shri Atal Bihari Vajpayee, it was planned to complete in January, 2012  It is highway network connecting many of the major industrial, agricultural and cultural centers of India  This project seeks to improve the connectivity of four major cities in India  It is the largest highway project in India and 5th longest in the world  GQ project would greatly impact urban and rural growth of Indian manufacturing  GQ project has led to improvements in both urban and rural areas of non-nodal districts located 0-10 KM from the GQ
  • 61.
     Represents thesecond phase of the NHDP  Consists of building 7300 KMs of 4/6 lane expressways  It connects Srinagar, Kanyakumari, Porbandar and Silchar  The proposed cost for this project is Rs. 42,000 crores As of date : - October 31, 2013 Segment NS – EW Corridor Total Length 7,142 KM Length Completed 6,177 KM Under Implementation 593 KM Length to be Awarded 372 KM % Completed 86.48 % STATUS
  • 62.
    The projected economicbenefits of these highway projects are:  Establishing faster transport networks between major cities and ports  Providing an impetus to smoother movement of products and people within India  Enabling industrial and job development in smaller towns through access to markets  Providing opportunities for farmers, through better transportation of products from the agricultural hinterland to major cities and ports for export, through lesser wastage and spoils  Driving economic growth directly, through construction as well as through indirect demand for cement, steel and other construction materials  Giving an impetus to Truck transport throughout India
  • 63.
    PREMISE OF THECASE: Large infrastructure projects have major implications for achieving low-carbon development goals
  • 66.
     DFC projectsignifies a major transition in the freight transport sector through increased sharing of rails, which are • More energy efficient • Environment friendly • Less Carbon intensive mode of transport  3 scenarios are taken into consideration here • Business-as-Usual (Without DFC) • Business-as-Usual (With DFC) • Low Carbon (With DFC)  Here Low carbon path development assumes a number of supply-side interventions that lead to further improvements in energy efficiency as well as decarbonisation of electricity at the generation stage. This is different from the BAU scenarios
  • 70.
     DEC 1910:Team of mechanics and aviators, led by Capt. WG Windham land in India.  Show case their airplanes for business opportunities  Exhibition at Exhibition Grounds in Allahabad
  • 72.
    YEAR: 1912 ROUTE: Karachito New Delhi Indian State Air Services and Imperial Air
  • 73.
     1932: JRDTata formed Tata Airlines  JRD Tata was the first Indian to get A license  First Indian commercial carrier to transport mail and passengers within India  The company was based out of a small hut with a palm thatched roof at Juhu Airstrip in Bombay (Mumbai)
  • 74.
     JRD flewthe first leg of the inaugural Karachi-Madras (Chennai) journey himself, taking mail from Karachi to Bombay via Ahmedabad using a single-engine De Havilland Puss Moth  In its first year, Tata Airlines flew 160,000 miles, carrying 155 passengers and more than 10 tonnes of mail.
  • 75.
     The IndianAir Force was established in British India as an auxiliary air force of the Royal Air Force  The IAF commissioned its first squadron , No.1 Squadron, with four Westland Wapiti Biplanes and five Indian pilots in 1933
  • 76.
     1924: Constructionof civil airports began in India. Construction began at Dum Dum in Calcutta, Bamrauli in Allahabad and Gilbert Hill in Bombay  1937: The Aircraft Act, 1934 was promulgated  1940: Hindustan Aeronautics Limited (HAL) was set up by Walchand Hirachand in association with the then Mysore Government at Bangalore.  1941: India’s first aircraft, the Harlow trainer was rolled out for test flight in July 1941
  • 77.
     1946: TataAirline becomes Air India  At the time of independence, nine air transport companies were carrying both air cargo and passengers.  1948: Government of India takes 49% of the company  Government of India established a joint sector company, Air India International Ltd in collaboration with Air India (earlier Tata Airline) with a capital of Rs 2 crore and a fleet of three Lockheed Constellation Aircrafts
  • 78.
     All airlinesnationalised  Eight formerly independent domestic airlines: Deccan Airways, Airways India, Bharat Airways, Himalyan Aviation, Kalinga Air Lines, Indian National Airways, Air India, Air Services of India were merged.  Air India International took over the international traffic  Indian Airlines Corporation handled the domestic operations
  • 79.
     1953: Civilhelicopters introduced for the first time in the country  The commercial use of helicopters in India was limited to small Aviation companies who were involved in communication and crop spraying roles.  1985: Pawan Hans Helicopters Limited (PHHL) and Indira Gandhi Rashtriya Uran Academy (IGRUA) in Fursatganj, Rai Bareli in Uttar Pradesh for training of pilots were established
  • 80.
     The NationalAirports Authority [NAA] established in 1986 for the management of all domestic airports and Air Traffic Management of the entire Indian airspace and adjoining oceanic areas
  • 81.
     The BCASwas under the Ministry of Civil Aviation and set up as a sequel to the Kanishka Tragedy in June 1985. The main responsibility of BCAS are lay down standards and measures in respect of security of civil flights at international and domestic airports in India
  • 82.
     http://www.apaoindia.com/?page_id=185  http://dgca.nic.in/ http://www.civilaviation.gov.in/  http://www.bharat- rakshak.com/IAF/History/Aircraft/AviationIndia.pdf  http://www.bcasindia.nic.in/aboutus/aboutus.html
  • 83.
    POLICIES  Liberalization -Private Players  Open Sky  Direct import of ATF - Regulation  FDI – domestic Services Sector  Airports control - Airports Authority of India (AAI)  Green Field Airport
  • 84.
     The AirCorporation Act, 1953 repealed  Opening up of the domestic sector  Disinvestment of the two public sector airlines  New privately owned domestic airlines  Open Sky  Allow foreign airline of any country or ownership to land at any port on any number of occasions and with unlimited seat capacity.  Foreign Direct Investment  Up To 49% Of Foreign Equity & 100% Of NRI investment is allowed Pertaining to the Domestic Air Transport Services  Private Carriers permitted to operate scheduled services – 75% share in domestic aviation.
  • 85.
     Entry oflow cost carriers  City side development of non-metro airports  Allowing Indian carriers to compete on international routes  Reduction in Landing charges.  Fleet expansion plans of Air India  Restructuring of Delhi and Mumbai airport and development of Greenfield airports at Bangalore and Hyderabad undertaken.  Up gradation/ expansion/ development of airports undertaken depending upon traffic potential, requirement of airline operators and need of air passengers.  With the liberalization of the Indian aviation sector, aviation industry in India has undergone a rapid transformation. Indian aviation industry is now dominated by privately owned full service airlines and low cost carriers.
  • 86.
     1991, September20: Sahara Airlines started its operations.  1993, May: Jet Airways started its operations.  1995: India’s six private airlines accounted for more than 10% of domestic traffic. Many foreign airlines started providing international services. In 1995, 42 airlines operated air services to, from, and through India.  1995, April 1: Airport Authority of India was constituted by merging the International Airport Authority of India with National Airports Authority.  1997: Policy on Airport Infrastructure of India was developed for the use and development of airport infrastructure.
  • 87.
     1999, June10: CIAL Airport was the first airport in India which was built with public-private participation and was made operational. The process for development of CIAL as a private airport began in 1993.  2000, October 2: Sahara Airlines was rebranded as Air Sahara.  2003: Entry of low cost carriers. Air Deccan started its services  2004: Government approved setting up of private Greenfield airports at Hyderabad and Bangalore.  2004, June: Low Cost Carrier – GoAir started it operations.  2004, December: Indian Scheduled carriers with a minimum of 5 years of continuous operations and a minimum fleet size of 20 aircraft, were permitted to operate scheduled services to international destinations.
  • 88.
     2005: IndianAirlines was rebranded as Indian. The Government designated Air India, Indian Airlines, Jet Airways and Air Sahara to operate international services.  2005, May: Kingfisher Airlines (Full Service Carrier) and Spice Jet (Low Cost Carrier) commenced operations.  2006, August: Low Cost Carrier – Indigo started its operations.  2006: The government approved the restructuring and modernisation of Mumbai and Delhi brownfield airports through the public-private partnership model.  2007: The Regional Airlines Policy was announced wherein licenses were given for operation of airlines within a particular region.
  • 89.
     2008, April24: The path breaking Greenfield Airport Policy of the Government was announced.  2008, August: Simplify Deccan was renamed as Kingfisher Red.  2009, May 12: AERA was established to regulate the economic aspects of airports. It is an autonomous body set up by an Act of Parliament.  2010: Airport Economic Regulatory Authority Appellate Tribunal (AERAAT) was established.  At present, India is the 9th largest aviation market in the world with 90 operational airports, 1,180 aircrafts, 303 helicopters, 11 operational scheduled airlines and 133 non-scheduled operators. It is envisaged that by year 2020, India will be among top 3 Civil Aviation Markets in the world and will handle about 300 million passengers.
  • 90.
     Year PassengerCarried (in millions) Domestic International Total 1990-91 7.5 6.3 13.8 1995-96 12.2 9.4 21.6 2003-04 15.7 14.6 30.3 2010-11 53.9 37.9 91.8 Source: DGCA, AAI; Analysis: MoCA
  • 91.
     Rising domesticGross Domestic Product (GDP)  GDP - 5.7% in the period 90-91 to 2003-2004 which then rose to 8.6% during 2004-05 to 2010-11.  Growing economic activity resulted in increase in business travel and greater leisure travel  Expanding middle-income group  middle income group population in 2010 stood at 160 million individuals i.e. 13.3% of the total population, which is expected to rise to 547 million in 2025 (i.e. 37.2% of the total population)  Demographic Dividend  62% of the population is in the working age group of 15-60 years - indicating a larger employee base, greater business travel and greater economic activity.
  • 92.
     Rising UrbanPopulation  Significant Market Developments Source: Spicejet Annual Report 2009 0 20 40 60 80 100 120 Column1 LCC FCS
  • 93.
     Low CostCarrier (LCC) model which made air travel affordable for common man got established firmly in the domestic market since 2004. This stimulated the pent up demand for air travel.  The domestic traffic is rapidly shifting towards the LCC model. Market sources suggest that this has crossed 67% during 2011-12.  This leads us to believe that Low Cost Operations in a price sensitive market like India appear to be a more sustainable business model
  • 94.
     Investments inAirport and related infrastructure  Total investment made by private airport operators in the last five years was to the tune of Rs 30,000 crores spread across Greenfield development of Hyderabad and Bengaluru international airports and modernization of Delhi and Mumbai international airports  Growing tourism  2001 to 2010-the average annual growth rate of foreign tourist arrivals in to India and Indian National departures from India grew by 9.2% and 11.5% respectively.  The number of foreign tourist arrivals in India stood at 5.6 Million in the year 2010 as against 3.46 Million in 2004 and 2.54 Million in 2001. Similarly, the number of Indian National departures from India stood at 12.1 Million in 2010 as against 6.21 Million in 2004 and 4.56 Million in 2001.
  • 95.
    Untapped market potential Airtraffic density in India using this measure is very low at 72 as compared to China (282), which is 4 times higher; Brazil (231), which is 3 times higher etc. indicates the untapped market potential. Global integration of businesses Greater economic activity and the consequent greater integration of businesses globally would mean greater business travellers across national boundaries. Also, the growing trend of outbound Mergers and Acquisitions (M & A) and is set to grow further in future implies greater business related travel
  • 96.
     Airlines inIndia are having financial difficulties.  Even Jet Airways has seen its market share and profits decline and stock price plummet by 40% since 2005.  Inability of the airlines to reduce costs  “Irrational” pricing that set in after the advent of LCCs. They have chased market share, i.e., revenue maximization and forced the incumbents to match their low prices.  OUTCOMES  Either some of them go bust in a market shake-out or they merge/get acquired by other airlines or business groups.
  • 97.
    These two nationalcarriers enjoyed monopoly power in the industry until the Air Corporations Act was repealed.  intense competition from private carriers - main reason for steep decline in their market share and profits.  Indian Airlines - monopoly on domestic services until 1994, market share decline from 100% to 17% since.  Air India and India Airlines merged in 2007 (NACIL was formed) in order to recover their losses and work efficiently  PROBLEMS- no clear ownership and mismanagement by authority  poor execution of plan and improper strategy along with massive misuse of funds
  • 98.
     Sub-optimal aircraftutilisation: Air India’s fleet utilisation is very poor with only around 100 operational aircraft out of a total registered fleet of 127 aircraft  Fleet issues: The B777-200LR, B747-400 and the A319 aircraft are poorly matched with the mission requirements of its international and domestic routes  Business model needs to be reworked: Air India requires a comprehensive review of its business model. At present there are fundamental weaknesses in each of its key domains.  Government intervention: In addition to these huge challenges, the management of Air India has to deal with excessive intervention by the Ministry of Civil Aviation and other ministries
  • 99.
     After theliberalization of Indian Economy in 1993, two new airlines, Jet Airways and Air Sahara entered in the domestic market.  15 years later, in 2008, Air Sahara was acquired by Jet Airways and renamed as JetLite.  Now Jet Airways and JetLite together share 23.8 % of the domestic market in India and this airline remained the market leader in Indian Domestic Sector for many years until recently toppled by Indigo to number 2 spot.  It is basically a full-service carrier, but also offers low-cost services under the name of JetKonnect.
  • 100.
     India's firstlow-cost carrier, Air Deccan, reported a $43 million loss for the fourth quarter ending June 2007.  To keep afloat, Air Deccan sold 26% of stake in May 2007 at $136 million to liquor baron Vijay Mallya's then two-year- old Kingfisher Airlines  This stake was later increased to 46%. The business models of these two airlines seemed to be as diametrically opposite - ran as separate entities. Kingfisher and Kingfisher Red  plan to improve performance and save money by sharing facilities and staff.
  • 101.
     The Kingof Good Times, liquor barren, Vijay Mallya, gifted this airline to his son on his 18th birthday as a birthday gift in 2005, it was deemed that the passengers would fly in the sky with a style.  For next six years, it indeed treated its customers in style. Even the airlines served on-board meals on its low-cost wing Kingfisher Red, against the trend.  the dream collapsed somewhere in the sky and today, the aviation regulator has cancelled the flying license of the Kingfisher Airlines.  Due to its poor financial health, the airline is unable to pay its dues to the banks and salaries to the employees  http://www.solobackpacker.com/2012/11/09/an- overview-of-domestic-airlines-in-india/
  • 103.
    Indigo uses afleet of 150 aircrafts from AIRBUS – A 320 The advantage of using a single type of aircraft shows in their profit making ability in this competitive aviation sector. Jet uses a mix of wide bodied boeing 777 and narrw bodied 737’s as well as slightly wider Airbus A330’s

Editor's Notes

  • #22 With more roads, less density, rising incomes it is not surprising that vehicle numbers are increasing
  • #23 Give latest data from RITES – 44% of locations examined by RITES traffic exceeds capacity and in another 19% it was verging on exceeding capacity
  • #28 Metro (Underground) – Rs. 3.5 billion per km (44 kms)Metro (Elevated) – Rs. 1.5 billion per km (104 kms)Mono Rail – Rs. 1.5 billion per km (40.3 kms)BRT – Rs. 0.2 billion per km (394.9 kms)
  • #30 Controlling DemandDiffusing DemandManaging assets working more efficiently.
  • #66 A possible explanation could be that road is perceived as a better option compared to rail in terms of level of service and service quality.
  • #77 An Act to make better provision for the control of the manufacture, possession, use, operation, sale, import and export of aircraft
  • #78 At the time of Independence, Nine Air Transport Companies were operational. Later the number reduced to eight when the Orient Airways shifted its base to Pakistan. The then operational airlines were Tata Airlines, Indian National Airways, Air Service of India, Deccan Airways, Ambica Airways, Bharat Airways and Mistry Airways. These airlines were operating within and beyond the frontiers of the company, carrying both air cargo and passengers.As the need for more air travel facilities became paramount, permission was given to almost anyone wanting to start an airline. This resulted in a profusion of quick start airlines, which competed with each other perhaps by cutting fares and downtime for maintenance. Soon enough the situation became untenable.
  • #84 Major imbalance in payments of loans.International Monetary Fund (IMF) demanded for economic reforms in return of aid. Prime Minister NarasimhaRao and Finance Minister Manmohan Singh took initiative to bring Liberalization, Globalization and privatization.
  • #92 2. These income groups drive the consumption pattern in India and are primarily concentrated in urban areas. NCAER analysis reveals that the middle income group population in 2010 stood at 160 million individuals i.e. 13.3% of the total population, which is expected to rise to 547 million in 2025 (i.e. 37.2% of the total population)25 .3, 62% of the population is in the working age group of 15-60 years and this proportion is set to increase in future indicating a larger employee base, greater business travel and greater economic activity.
  • #93 4,Mckinsey Global Institute’s projections state that India’s urban population will be 590 million by 2030 i.e. about 40 percent of the total population of India. The number of million plus cities will increase to 68 by 2030 of which 13 cities will have more than 4 million and six cities will have more than 10 million persons.27 5. Low Cost Carrier (LCC) model which made air travel affordable for common man got established firmly in the domestic market since 2004. This stimulated the pent up demand for air travel. LCCs along with the LCC brand of Full Service Carriers (FSCs) constituted 63.3% of the market share in 2009. The domestic traffic is rapidly shifting towards the LCC model. Market sources suggest that this has crossed 67% during 2011-12. Also, the LCCs are reported to have displayed strong operational performance immediately after the recovery witnessed in 2010. This leads us to believe that Low Cost Operations in a price sensitive market like India appear to be a more sustainable business model
  • #95 Opening up of the airport infrastructure to private sector participation fuelled the growth of the air traffic in India. 29. Airports Authority of India (AAI) continued its unparalleled role in creating air connectivity across the nation, incurring an expenditure30 of around Rs 12,500 crores during the 11th Plan period. Rapidly expanding air transport network aided by massive investments in the airport infrastructure could be cited as one of the key reasons for the surge in air passenger traffic in India. 7.In line with the trend observed in growth of India’s GDP, the tourism sector has displayed stellar performance during the last decade. During the period from 2001 to 2010, the average annual growth rate of foreign tourist arrivals in to India and Indian National departures from India grew by 9.2% and 11.5% respectively. Domestic tourism was not to be left behind. Domestic Visits within India stood at 740.2 Million for the year 2010.31 In fact the average annual growth rate of Domestic Tourist visits within India for the decade ending 2010 is estimated to be 13.5%. The number of foreign tourist arrivals in India stood at 5.6 Million in the year 2010 as against 3.46 Million in 2004 and 2.54 Million in 2001. Similarly, the number of Indian National departures from India stood at 12.1 Million in 2010 as against 6.21 Million in 2004 and 4.56 Million in 2001. 9
  • #96 . The air traffic density can be measured by linking Urban Per capita income with air passengers. Taking 1000 passengers per Million Urban Capita32, a recent study has arrived at a comparative picture. Air traffic density in India using this measure is very low at 72 as compared to China (282), which is 4 times higher; Brazil (231), which is 3 times higher; Malaysia (1225) is 17 times higher, U.S.A. (2896) is 40 times higher and Sri Lanka (530), which is 7 times higher as exhibited in Graph 6. This indicates the untapped market potential given the projected burgeoning young population and rising disposable income levels in future. GGreater economic activity and the consequent greater integration of businesses globally would mean greater business travelers across national boundaries. Also, the growing trend of outbound Mergers and Acquisitions (M &amp; A) i.e. Indian firms acquiring International firms in order to capture markets and resources abroad, where the M &amp; A transaction value for the year 2010 touched almost $ 50 billion34 and is set to grow further in future implies greater business related travel
  • #97 There is no question that all the airlines in India are having financial difficulties.These depressing financial conditions can lead only to two types of outcomes for the airlines2007 became a landmark year in the industry because of the major consolidations that took place during the year.
  • #98 The following are the major examples of consolidation in the Indian aviation industry. What is striking about these consolidations is that two of them are between carriers which have made heavy losses!