Civil Aviation: MRO-Leasing 100% FDI

Civil Aviation Ministry has formed an alternate mechanism for disinvestment of Air India to give timeline for disinvestment and first meeting will take place soon, Hardeep Singh Puri, Minister of State (I/C), Ministry of Civil Aviation said on 20 July 2019.

“We are currently working on a 100 Day Program, and a five-year vision of document of both Housing and Urban affairs and Civil Aviation ministry,” said Puri, also Minister of State (I/C) for Urban and Housing Affairs.

Puri further said there is already 100% FDI in several parts of Civil Aviation sector, the budget has pointed out two specific sectors for FDI, one is maintenance & repair and other is leasing.

The growth of air cargo is critical for industries such as e-commerce, pharmaceuticals, electronics, agriculture, horticulture, floriculture, animal husbandry and marine exports, and high-value goods, including gems and jewellery and fashion garments, where shipments are highly time-sensitive, stated Puri at the sidelines of 12th International Conference-cum-Awards of Civil Aviation & Cargo.

In conformance with the objectives of the holistic National Civil Aviation Policy, 2016, a number of initiatives and measures were taken up to sustain the growth impetus in air cargo, efficiency improvement and promotion of ease of doing business across the air cargo value chain.

The first National Air Cargo Policy’s (NACP) outline was released at the Global Aviation Summit in January 2019.

It aims to achieve fundamental re-engineering of the whole-of-the-value-chains for domestic and export-import air freight for reaching the target of handling 10 million tonnes by 2026-27.

The objectives of the NACP outline are to leverage the Indian air cargo network to provide cargo transportation by air at an affordable cost and connect every village to the national and global supply chains. It also aims to make air cargo and logistics in India among the most efficient, seamless, and cost and time effective in the world over a period of 10 years, said Puri.

Impressive double-digit domestic air cargo growth of 12.1 per cent has been achieved in 2018-19 over 2017-18.

Air cargo handled reached to 3.6 MMT comprising domestic air cargo of 1.36 million and international air cargo was 2.2 million MT (y-o-y 2.6 % growth), added Puri.

General cargo tonnage handled increased by over 10% per year in last four years as against negative growth in the preceding four years.

Indian air express and courier industry is one of the fastest growing markets globally.

Growth estimated at 17% CAGR during the last five years, entry of e-commerce giants into the air cargo business expected to give further impetus to its growth.

The government has taken several initiatives to sustain the growth impetus in air cargo and to bring the country’s logistics on a par with global standards. Service Level Standards set for entire air cargo eco-system. Reduction of free period for air cargo clearance from 72 hours to within 48 hours across all major airports, noted Puri.

Progressively, air cargo dwell time on imports has been reduced from 72 hours to about 52 hours by December 2017. By the end of December 2018, the dwell time further reduced to about 39 hours for imports (IATA). Dwell time reduced at major airports by 36-72% on export cargo, and averages below 24 hours.

A digital National Air Cargo Community System is expected to be developed and operationalized within one year as a common platform for all stakeholders to communicate with each other digitally and improve ease of doing business in air cargo sector.

Puri, who was the Chief Guest for the occasion, gave away the awards to the winners nominated under various categories. Some of the other winners were Airbus, AAI Cargo, Bird Academy, Air India Express, Spice Jet, Frankfinn during the summit. fiinews.com