Smaller towns may be ticket to growth for foreign carriers

Smaller towns may be ticket to growth for foreign carriers

New Delhi: Airports in smaller Indian cities and towns such as Chandigarh and Bagdogra are set to start handling international flights, as several new and existing low-fare foreign airlines seek to expand operations in the country.

The civil aviation ministry has so far this year allowed three such airports to put up immigration counters and other facilities needed for handling foreign routes. Several more are to follow.

Bhutan’s Druk Air Corp. Ltd on Friday launched its inaugural flight between Paro in Bhutan and Bagdogra, a town in West Bengal’s Darjeeling district.

Currently, only around two dozen of India’s 127 airports are equipped to handle international flights. Many of these are run by the Airports Authority of India, or AAI.

“We are creating customs and immigration facilities and asking other agencies to co-operate in the process," said a senior government official involved in the process.

The official, who didn’t want to be named, said the government has already granted permission to several airlines, many of them low-fare carriers, from countries that are part of the Association of Southeast Asian Nations, or Asean, to fly to 18 tourist destinations in India.

These include Port Blair in the Andaman and Nicobar islands, Bhubaneswar in Orissa, and Aurangabad in Maharashtra. None of the airports in these places currently handle international flights.

The Chandigarh and Madurai airports will be ready to handle international flights by October, a senior AAI board member said. He declined to comment on the investments required to upgrade the facilities and potential additional revenues for these airports from the international traffic.

Upgrading airports in the cities and towns to handle foreign flights involves setting up of immigration counters in coordination with the ministry of home affairs, customs duty counters in coordination with the ministry of finance, and ensuring security services as guided by the respective state governments.

The Boeing 737-800 or Airbus A320 type of aircraft require no major aeronautical infrastructure changes at airports as many of these already host domestic flights that operate these category of aircraft.

Several international carriers that ply to metro cities such as New Delhi, Mumbai and Chennai have over the past four years started direct flights to smaller cities such as Thiruvananthapuram and Nagpur, backed by the Indian government’s bilateral liberalization policy. The civil aviation ministry permits foreign carriers to fly on specific routes based on agreed bilateral rights with their countries.

Now, some West Asian and South-East Asian carriers plan to permeate into remote towns and cities such as Bagdogra, and Madurai in Tamil Nadu, flying passengers directly to their hubs in places such as Dubai, Singapore and Kuala Lumpur.

The Dubai government-owned Emirates, through its newly launched low-fare carrier FlyDubai, plans to start flying to Chandigarh, Goa, Coimbatore and Lucknow directly, according to its request submitted to AAI.

“India is a very important market for us and we are looking forward to being able to include some Indian destinations within our route network," FlyDubai’s chief executive Ghaith Al Ghaith said via email.

Asia’s biggest long-haul discount carrier AirAsia X has already started flying between Tiruchirapalli in Tamil Nadu and the Malaysian capital, Kuala Lumpur.

Over the past five years, the proportion of international passengers handled at the Delhi and Mumbai airports has declined to 51.3% from 58.2%, according to consulting firm Centre for Asia Pacific Aviation. In 2008, international passenger traffic into and from India was 26 million, according to the civil aviation ministry.

Aviation analysts, however, warn that allowing such an expansion by foreign airlines into remote Indian towns could be detrimental to homegrown carriers.

The potential exists in these cities though the demand is rather low, said Robey Lal, a former India country head for International Air Transport Association, or Iata, a trade body.

India’s airlines would have to gear up to the challenge from these foreign carriers as this could be “detrimental" to their existing route network, he said. “As these West Asian carriers grow, India is the country that can provide them (passenger) volumes and trained and inexpensive manpower," Lal said.

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