Indian Modern Airports Dilemma

Wednesday, 24th April 2013 at 10:55am

The airports in the country's major gateways such as Delhi, Mumbai, Hyderabad and Bangalore, were built to world-class standards by private developers and they were built to provide optimum comfort to all airport users, be they airport workers or passengers. Meanwhile, the governments used public funds to built the airports in Kolkata and Chennai through Airports Authority of India.

The GMR Group and the GVK Group each invested more than Rs12,000 crore to build Delhi's Indira Gandhi International Airport and Mumbai's Chhatrapati Shivaji International Airport, respectively.

All commercial airports, like them, are designed to provide travelers hassle-free travel from their point of origin to anywhere across the country and beyond. Of course, the government or private companies, spent lots of money for these airports to function what they were designed for, as hubs for aircraft.

Mumbai's Chhatrapati Shivaji International Airport, for example, is used by most of India's major airlines as their hub, owing to its size and the city that it serves. Abu Dhabi, Dubai, Doha, London and Singapore are just a few major cities that are quite successful in turning their respective airports into a major hub. The cities of Abu Dhabi, Dubai and Singapore are a special case because their domestic market is almost negligible compared to other major hubs such as Mumbai's and Delhi's airports.

The recent amendment of FDI policy by the government allowing foreign carriers to own up to 49% stakes in a domestic airline are thought to be a bane to the country's new and huge airports aspiring to become a major hub.

There are basically two ingredients that an airport needs to become a successful hub. First and foremost, the airport has to keep a single major airline to base its operations there like what Dubai does to Emirates and Frankfurt to Lufthansa. Secondly, an airport has to have an efficient airport infrastructure and support facilities such as an efficient transport system to move passengers and airport workers to and from the airport or between terminals

Unfortunately enough, India's major airports don't seem to have the first ingredient, an airline that is big enough to sustain the airport's healthy operations. IndiGo, India's largest airline, is a point-to-point carrier and doesn't qualify to be a network carrier. Jet Airways has the quality to become an anchor airline to a major airport but, sadly enough, it is now going to move its hub out of India once the deal between the local airline and Etihad is finalized.

Air India is clearly out of the question as it, too, is struggling to keep its head up above the pool of financial losses. Other Indian airlines are too small to become anchor airlines.

The reason why many foreign airlines are pulling out of the country is the high airport tax and other fees imposed against them.

Even the future airline, a joint venture betwen the Tata group and AirAsia, is not planning to base their operations in either Delhi or Mumbai, but Chennai.

By: .

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