Vijay Mathur: India's take-off troubles

The civil aviation industry would do well to set up a multidisciplinary expert group charged with policy making, leaving little wiggle room for the government.

The growth of civil aviation over the past decade has been phenomenal, and far beyond what anyone ever imagined. I recall a meeting convened by the Planning Commission to discuss growth targets for the 10th Plan in the mid-nineties, where a proposed annual growth target of 2 per cent was being vigorously questioned. Over the past decade, the sector has grown by a phenomenal 25 per cent a year.

Growing up in the ’50s and ’60s, all of us were painfully aware of the persistent shortages of many goods and services. The only services readily available then were power and water. In this background, I have always been amazed at our paranoia over surplus capacity. Look at how short of airport capacity we are today, and contrast it with a mindset that was unwilling to set a growth target of only 5 per cent for a fear of overcapacity.

 

Air services in the ’60s and ’70s were readily available, but hardly affordable. They were clearly elitist, and, in any case, available to limited destinations. In contrast, some years ago, a minister of civil aviation declared that air services have been “democratised” — so we have obviously come a long way, with even the Railways feeling the pinch of competition from airlines.

Ministerial leadership and administrative policies and action have, over the last few years, created a solid base for the future growth and broadening of Indian aviation. However, as the dynamics of political coalitions have vividly demonstrated, we need to move quickly to consolidate these policies and legislate some of them in a manner that will make expedient tinkering by subsequent governments much more difficult.

How then do we begin? We have begun the process of moving government out of the aviation sector; it is now necessary for business to get proactively involved in governance and policy formulation. The following steps could be taken: 

 

We have several Acts dating to the 1930s, which obviously need a comprehensive overhaul. 
 

In 2000, the government set up a committee to redraft the Civil Aviation Act comprehensively to provide an institutional and legal framework for the regulation of Civil Aviation in the changed context and the demands of current needs. The Civil Aviation Act, 2000 sought to repeal other existing Acts such as the Aircraft Act, 1934; the Carriage by Air Act, 1972; the Tokyo Convention Act, 1975; the Anti Hijacking Act, 1982; and the Suppression of Unlawful Acts against the Safety of Civil Aviation Act, 1982.

Surprisingly, after long and protracted deliberations, this legislation was dropped. The aviation industry now needs to take upon itself a comprehensive updating of this draft, and, thereafter, push strongly for its enactment. Issues that need to be addressed specifically are: 

The future roles of the Directorate General of Civil Aviation (DGCA), the new aviation regulator, and the the Airports Authority of India (AAI) need to be redefined in the context of privatisation that has already taken place, and the additional steps that are expected. Unless there is a single, comprehensive review that also harmonises the consequent legislation with the latest position prevailing internationally, we will run into difficulties and delays later. 
 

In the light of the above, financing models and taxation need to be aligned and then fiscal policies that will remain consistent over the next 10 years need to be put in place. 
 

Security and related technology issues need to be integrated with the many new advances being made to counter terrorism, and organisational and legal issues mandated accordingly. 
 

Environment issues, particularly with reference to noise, and cleanliness around airport peripheries, need to be mandated and implemented.

Some issues that will become increasingly contentious in the future if they are not clearly and comprehensively dealt with now are: 

Slots. 
 

Moving bilateral flights between competing airports. 
 

Acquisition of land for airport expansion or new airports — Singur vividly highlights the need for a standardised approach to such issues. 
 

Airport ownership models — a clear evolution of the role of state governments, and eventually, even Municipal Councils in the development of airports.

Besides, the following segments of civil aviation need a comprehensive and long-term policy format to be drawn up: 

General aviation. 
 

Helicopter operations including setting up of heliports. 
 

Flying clubs, pilot training and leisure aviation. 
 

Communication Navigation Surveillance / Air Traffic Management and Geo-Stationary Augmented Navigation.

All of the above need to be undertaken keeping in mind the growth and fundamental restructuring that are taking place across the world. Technology, markets, routes and security are changing dramatically, and unless a holistic view is systematically built up, discussed, and then converted into a detailed policy document and draft legislation, and presented to the government for its consideration and adoption, we will lose the gains of the recent past.

Let us be clear — the onus for this is on industry. It has access to professional expertise and the required global information base so it must provide the commitment and financing to carry this out. Also, now that the demand for privatisation has been acknowledged and initiated, it is time industry did its bit.

So far industry involvement in policy making has been reactive, that is, one of responding to government proposals and initiatives. It is time it got into the active mode and expected the government to react, discuss and then legislate on the drafts.

The time for long-term strategic thinking is upon us, and this can no longer be overlooked in the rush to meet short-term priorities.

To sum up, we have created a framework that now needs to be fleshed out in some detail, and then set in stone.

Therefore, cutting across the entire sector, airport operators, airlines, fixed-base operators (FBOs), Maintenance, Repair and Overhaul or MRO services, air charters, ground handlers need to come together on a common platform to set up a multidisciplinary group of experts, who are then adequately funded and charged with evolving a comprehensive set of policies, recommended institutional structures and legislation. Once this has been fine-tuned and pan-industry acceptance formally obtained, it should then be forwarded to government for its consideration and adoption.

If we do not do so, the Indian aviation industry will have no one but itself to blame in the future.