Reduction in Flying cost Rs. 1000 crores - Efficient Airspace Management for Civil Aviation
Reduction in Flying cost Rs. 1000 crores - Efficient Airspace Management for Civil Aviation

Reduction in Flying cost Rs. 1000 crores –
Efficient Airspace Management for Civil

  • Currently, only around 60 per cent of the country”s airspace is freely available.
  • Restrictions on utilisation of the Indian Air Space will be eased so that civilian flying becomes more efficient.
  • Efficient airspace management for civilian flights could help in reducing flying costs to the tune of Rs 1,000 crore.
  • The move would help “bring a total benefit of about Rs 1,000 crore per year for the aviation sector,” FM said, adding that there would also be a positive environmental impact.
  • A meeting chaired by Prime Minister Narendra Modi decided that the Indian airspace should be effectively used in a manner that flying time for travellers is reduced and airlines also save costs.

More World-class Airports through PPP

  • More world-class airports in India soon! Finance Minister Nirmala Sitharaman in her press conference on May 16 announced today announced that the bid process for more airports in the country under the Public Private Partnership (PPP) model will start soon.
  • The Airports Authority of India (AAI) has awarded 3 airports out of 6 for Operation and Maintenance on the PPP model.
  • The annual revenue of the 6 airports in the first round is Rs 1,000 crore (against current profit of Rs 540 crore per year).
  • AAI will get a down payment of Rs 2,300 crore.
  • Six more airports have been identified for the second round and the bidding process for these will begin immediately. The idea of awarding these airports on the PPP model is to get world-class transit hubs in India.
  • The additional investment by private players in the 12 airports in the first and the second rounds is expected to be around Rs 13,000 crore. Another six airports have been identified for the third round of bidding.

India to Become Global Hub for Aircraft Maintenance, Repair and Overhaul (MRO)

  • As part of the economic restructuring regarding Aviation Sector, Finance Minister Nirmala Sitharaman announced that the reforms pertain to three broad categories including rationalisation of airspace, auctioning of new airports and making India an MRO (Maintenance, Repair and Overhaul) hub for airplanes.
  • The Govt wants to make India a hub for Airplane MRO (Maintenance, Repair and Overhaul) and has laid a detailed plan in today’s announcement. For the same, tax regime for MRO Ecosystem has been rationalized.
  • Govt aims to increase the aircraft component repairs and airframe maintenance from Rs 800 crore to Rs 2000 crore in next three years.
  • It is also been announced that the aircraft maintenance will come down, increasing revenue for air carriers.
  • Major engine manufacturers like Rolls-Royce, Pratt & Whitney, GE are expected to set up their engine repair facilities in India in the coming years as well.
  • To further reduce MRO, defense and civil aviation sectors will work in coherence to increase economies of scale.

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