Airlines urged to connect smaller cities to beat downturn

March 30th, 2009 - 7:07 pm ICT by IANS  

Hyderabad, March 30 (IANS) The civil aviation sector should look for business opportunities in the economic downturn through innovation, ensuring more connectivity to smaller cities and targeting the middle class, a top government official said Monday.
Civil Aviation Secretary Madhavan Nambiar called upon the aviation sector to replicate the success of the telecommunication industry by spreading its reach through this vast country.

“The at least 30 crore-strong middle class should be able to utilise this sector to spur its growth,” he said.

Nambiar was addressing the leaders forum at Seventh Routes Asia, a premier event for the airlines and airports in Asia Pacific region, which began here Sunday.

He underlined the need for the aviation sector to market well and play a stimulating role in India’s emergence as a global superpower.

Nambiar, who was earlier with the telecommunications industry, pointed out that it was adding 10 million mobile phones a month.

He said the rural economy was “not badly impacted” by the slowdown and the purchasing power was still strong.

“I am sure airlines will see this as a business opportunity and, if required, realign their routes to ensure more connectivity to smaller cities,” Nambiar told the delegates.

He pointed out that the northeast was an under-served area where the Airports Authority of India (AAI) was incurring a loss of Rs.100 crore on airports. The aviation secretary asked the airlines to work with the AAI to make the airports sustainable.

According to Nambiar, the sector is suffering from a phenomenon of over capacity on trunk routes and under capacity on non-trunk routes.

He pointed out that the sector in India had an enormous five-year long rally in civil aviation, witnessing unprecedented growth of the order of around 20-25 percent per annum.

Out of 89 operational airports in the public sector, almost 60 airports have been taken up for extensive development work, Nambiar said.

“In the 12th five-year plan period, the AAI will spend Rs.12,000 crore on airport modernisation programme. We have spent over Rs.20,000 crore during the 2004-09 period in the airport sector as against Rs.2,050 crore in the 1999-2004 period,” he said.

He added that the initiatives helped the airports increase passenger handling capacity from 71.4 million passengers in 2003-04 to 101.2 million.

“We expect it to increase further to 200 million with the completion of ongoing projects including the modernisation of Delhi airport,” Nambiar said.

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