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EDITOR-IN-CHIEF’S NOTE
I’ll give you the rules
S
hould flying overseas be the monopoly of a few (in this case just Air India and Jet Airways)? Should it be altogether scrapped or should it be on a case- to-case basis? As far as the ministry of civil aviation is concerned, it should be on a need-to-fly basis. In other words, Rajiv Gandhi Bhawan will determine whether you fulfil the requisite conditions and you are really ready to take wings and fly across the seas. But that’s a bit of a misnomer really. Most domestic airlines operate either the A320s or the 737s and will inevitably limit themselves to the four-hour maximum. In any case, the concept of LCC will fly out of the window if they have to do long hauls. For starters, their present fleet won’t permit that, the LCC concept will have to be tweaked and they will have to get wide-bodied aircraft if they have to fly elsewhere (Air Asia is just about beginning to do that in Malaysia). That would mean really flying to the Gulf and Southeast Asia. But that’s not really the bone of contention. In any case if the five-year moratorium on the Gulf will come to an end in the third quarter of 2008 and Vijay Mallya and Kingfisher (through the Air Deccan brand—because it would complete the five-years-in-existence rule and not Kingfisher) and SpiceJet will be eminently qualified to zip into the UAE or Singapore and KL. So what really is the issue, then? Vijay Mallya believes that the five-year rule must be scrapped and airlines must be allowed to fly wherever they wish to. He has reason to plug this line: his 330s and 340s will start arriving from March and if permission to fly overseas doesn’t come by the year-end where is he going to fly these aircraft? On the high density Delhi-Bangalore route,
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instead of the non-stop over-the-Himalayas Bangalore-LA 340 flight that he dreams of? The new civil aviation policy framework, which is still under debate, will hugely empower Rajiv Gandhi Bhawan to use Praful Patel’s favourite expression— case by case—to fulfil Mallya’s dream. But when others get into the ring, as did Messers Laloo Yadav, Hansraj Bhardwaj and Prem Gupta, then you need to ask what’s all this noise about? They are pushing for cabinet decisions to be honoured and do not want the five-year benchmark to be tampered with. And the CPI general secretary, A.B. Bardhan, writes to the minister asking for status quo to be maintained. There are many who believe that the present battle in the GoM (Group of Ministers) is really shadow boxing between the entrenched players in the business who don’t want any new entrants at this stage. Considering that the public sector Air India can hardly be expected to lobby with other ministers, the inference is that the battle lines are being hardened at the behest of Naresh Goyal and Jet Airways. That could well be true. But does that take away from the fundamental issue that in all these years, policies have been framed to suit someone or the other? Be it the five-year-and-twenty-aircraft rule or the scrutiny-of-the-business-plan rule or the case-by-case clearance diktat, there is something in it for someone. That Mr Vijay Mallya can order a wide-bodied aircraft in the confidence that the rules can be tweaked to get him airborne doesn’t speak well for civil aviation policy making. It only tells us: give me the man and I’ll give you the rule.
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Sudden death in the air
The news that an economy-class passenger had died on a non-stop flight from the US to India has not come as a surprise. Known as the economy-class syndrome or coachclass syndrome, because seating and legroom are particularly cramped for passengers in economy class, deep-vein thrombosis (DVT) is potentially life threatening. In it, blood clots form in the body’s deep veins, particularly in the legs. Sometimes a clot breaks off, travels through the bloodstream and obstructs a vessel in the lungs, restricting blood flow. This condition is called pulmonary embolism. This damages tissues and causes poor lung function, which can be fatal. However, first-class and businessclass passengers also get DVT; so this problem is not solely due to sitting still in tight quarters for many hours. Other factors, such as lowcabin pressure, low humidity and dehydration, may all contribute. These factors are present throughout the plane. People who survive their first episode of DVT may have chronic swelling in their leg and pain from blockage of blood flow through the vein. This can reduce their ability to live a full, active life. People who have had a DVT episode are also prone to have more. People who have a history of cardiovascular disease, stroke or thrombosis episodes (blood clots) are at risk of getting blood clots in their legs during airplane flights of 10 hours or longer. But these are not the only people who can have this problem. DVT can affect healthy people, even athletes. How can DVT be prevented? Studies in healthy people have shown that wearing ‘compression stockings’ may help minimise the risk of developing DVT after long flights. These stockings put pressure on leg muscles and help return blood flow from the legs to the heart. Drinking extra water, walking, if feasible, and avoiding alcohol are also good. These steps are not scientifically proven to prevent traveller’s thrombosis, but they are common sense.
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contents OPEN SEASON p22 The aviation sector is in a fast-forward mode. Consolidation is under way and new ground is being broken almost everyday. A close look at the ground-handling policy, which is receiving shape along with other related developments.
p18
CONVENTIONS AND A SUMMIT p28
The country’s foremost helicopter company has started building a heliport in the Capital, next to the Akshardham temple. A report.
While an aviation conference generated interest because it dealt with air crashes, hospitality and tour operators meets took a look at the tourism boom and the challenges it has brought in its wake
PERSPECTIVE
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ARTICLES NEWS VIEWS EDITS INTERVIEWS CLIPPINGS TRAVEL & TOURISM PROFILES NEWS DIGEST
OFF THE RECORD p6 A reshuffle has taken place in GMR’s aviation business and Kiran Grandhi has been put in charge
CRUISING HEIGHTS K. SRINIVASAN Editor-in-Chief
TIRTHANKAR GHOSH Managing Editor
R. KRISHNAN
Consulting Editor
SUNIL BHASIN Editor (Quality)
MOVING TOWARDS PAPERLESS TRAVEL p20
SHIVANGI SHARMA
China will be the first country in the world to operate an entirely paper-free ticketing system by the end of this year. While e-ticketing is gaining popularity, how far are we from the goal of paperless travel?
RUCHI SINHA PRADEEP JHA
Editorial Coordinator
Layout Artists
BHART BHARDWAJ Art Director
H.C. TIWARI
Consulting Photographer
RAJIV SINGH
Gen. Manager (Admn.)
RENU MITTAL Executive Director
INDIA POST FLIES WITH CARGO
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When Air India’s freighter took to the skies recently, it made history: the plane was the first freighter of the Indian postal department and it was also the first cargo carrier of Air India.
NEWS DIGEST
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If news reports are any indication, Jet Airways’ Naresh Goyal and Civil Aviation Minister Praful Patel share a beautiful relationship
GLOBETROTTING
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Airport security officials were taken aback when they found a woman wearing a live bullet as a pendant
SNIPPETS
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Air Deccan continues on its connecting spree. It recently flew to Jamshedpur from Kolkata.
CRUISING HEIGHTS September 2007
Editorial & Marketing office: Newsline Publications Pvt. Ltd. C-15, Sector 6, Noida 201 301 Telefax.: +91-120-4257701-03 All information in CRUISING HEIGHTS is derived from sources we consider reliable. It is passed on to our readers without any responsibility on our part. Opinions/views expressed by third parties in abstract or in interviews are not necessarily shared by us. Material appearing in the magazine cannot be reproduced in whole or in part(s) without prior permission. The publisher assumes no responsibility for material lost or damaged in transit. The publisher reserves the right to refuse, withdraw or otherwise deal with all advertisements without explanation. All advertisements must comply with the Indian Advertisements Code. The publisher will not be liable for any loss caused by any delay in publication, error or failure of advertisement to appear. Published by K. Srinivasan 4C Pocket-IV, Mayur Vihar Phase 1, Delhi 110091 and printed by K. Srinivasan at Nutech Photolithographers, B-240, Okhla Industrial Area, Phase-I, New Delhi 110 020 Vol II No 5
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On time, all the time
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“The mandate of our operations’ strategy is to achieve all departures as per schedule. We are pursuing the objective with clinical incisiveness. We have decided to build a fleet of entirely new aircraft to tone up operations.” Air Deccan’s chief executive officer RAMKI SUNDARAM on replacing older ATRs with new ones.
LETTERS TO EDITOR
The cover story (Future Ready, August 2007) made interesting reading, and it has rekindled hopes that Air India will once again fly and shine. The interview of V. Thulasidas was quite enlightening, but he now has quite a task cut out for him. Earlier, it was merely tackling competition, which was from outside. Now, he will have to deal with inside problems as well. At times it can become really difficult to manage two difficult cultures and make them work towards a common goal. I sincerely wish that all employees in the new entity avoid and prevent internal skirmishes. They must realise that ultimately it is in their own good. After all, if they are desirous of raising retirement age and getting post-retirement benefits, they will have to work for it—together and in harmony. A.N. Upadhyaya, on email August 2007
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Illustrations: Rajeev Kumar
I was greatly pleased to read about the recent Skytrax survey, in which it has selected the annual list of the top 10 first-class airline experiences. What is pleasing is that seven of the ten are Asian carriers, and Jet Airways stands seventh. I sincerely wish to see Air India figuring on this list. Now that it has got brand-new aircraft all that it needs is the co-operation from its staff. The day should not be far. Till then I will console myself with the fact that a beginning has been made and India cannot be behind. Nisha Mishra, New Delhi
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For long, there was no activity on the cargo front, and all of a sudden, this price-fixing incident rocks the industry. The writer has done a really good job of laying the situation threadbare. Although the culprit airlines must not been spared, even the whistleblowers should be given adequate warning that, barring the present incident, such acts will be met with zero tolerance in future. Raj Kishore Aggarwal, on email
No cross-pollination “We will not encourage existing national airlines to operate under the regional airline banner. The idea is to increase air connectivity that could in the years to come become aviation hubs around the country.” Civil Aviation Minister PRAFUL PATEL on the new regional airlines policy unveiled last month.
Big plans “There are plans to address Southeast Asia, too, in a big way. We would be looking at strengthening our presence in this sector. The introduction of wide-bodied aircraft from the beginning of next year would be one such step.” Jet Airways’ chief executive officer W. PROCK-SCHAUER on their plans for other regions.
Low cost Maharaja “If the experiment of Mr Tony Fernandes [Air Asia promoter] and the Hong Kong airline [Dragon Air] clicks, then there may be a market for us also. The airline has always maintained that low cost is the future, but we will have to tread carefully.”
Air India CMD V. THULASIDAS on the possibility of the Maharaja moving into long-haul, low-cost operations.
No bloodshed “There were no price wars this year. As there was no significant capacity addition this year on the IndiaLondon route, fares went up.” Virgin Atlantic’s India marketing manager NEHA LIDDER GANJU on why the LondonDelhi route did not bleed this year.
All correspondence may be addressed to Editor, Cruising Heights, C-15, Sector 6, Noida 201 301 OR mail to newslinepublications@rediffmail.com
CRUISING HEIGHTS September 2007
Say Ta-ta and get better “We have rejuvenation schemes for airhostesses above the age of 40-45 years.” Indian CMD VISHWAPATI TRIVEDI on the national carrier’s proposal to airhostesses to receive a onetime payment of Rs 25 lakh and leave the airline.
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Footfalls rise in airports Airports worldwide reported excellent results for July 2007. Passenger traffic rose by 6.4 per cent as compared with previous July. International traffic worldwide increased 7.3 per cent, and domestic traffic rose by 5.9 per cent.
COLD STATS
For the period January to July 2007, passenger traffic rose by 5.3 per cent as compared with previous corresponding period. International traffic worldwide increased 6.6 per cent, and domestic traffic rose by 4.4 per cent. Source: Airports Council International
LOOKING GLASS Welcome to my empire! On my right is my factory, on my left is my farmhouse and behind me is my very own airport!
Talks are on “We are in talks with several companies having MRO experience, though we have not finalised with any. Running MRO is not an easy job. A minimum of 200 aircraft need to be serviced to keep an MRO afloat.” Boeing’s senior vice-president DINESH KESKAR on Boeing’s MRO plans for Nagpur.
Speeding up the process “If this passenger-friendly move can be implemented without compromising the safety and security requirements, it can be considered. Globally also, air travellers are called three hours in advance for security reasons. But we will look at issues like how long it takes for international passengers to clear security, immigration and other counters as against the IATA benchmarks in Indian airports.” Civil Aviation Secretary ASHOK CHAWLA on the need to speed up airport operations.
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OFF THE RECORD
Reshuffle at
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Kiran Grandhi
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t is like a full-fledged cabinet reshuffle at GMR Infrastructure. The key change, as far as the aviation business, is concerned is that G.M. Rao’s son, Kiran Grandhi, will be directly responsible for this division. His son-in-law, Srinivas Bommidala, who is the MD of Delhi International Airport, has been given charge of urban infrastructure and highways, including the SEZ projects of the group. Begin-
ning October 1, B. Srinivas, as the GMR group prefers to address Bommidala, will be headquartered in Bangalore. But for the moment he is the man in command and ushered a delegation of senior officers, lead by Secretary Ashok Chawla and a few media persons, in early September for a look at the work being undertaken by DIAL to fast track the project into the 2010 completion mode as far as Phase One goes.
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Merger update SO WHAT is happening in the merger space? For all practical purposes, Air India and Indian Airlines are now Air India, but everything else continues to be the same. In fact, in his first letter to the directors on the board of the company, chairman and managing director V. Thulasidas clearly spelt out that all of them will continue to discharge the very functions that are their responsibilities in the two carriers till further orders. In other words, Indian will continue to handle its chores and the Maharaja will mind its own business. Meanwhile, at the domestic end of the operation, joint managing director Vishwapati Trivedi and managing director of Alliance Air, Deepak Brara, have just wrapped up a London visit to sign up several Bombardier jets, which will be inducted into the LCC fleet. These leased aircraft were ordered before the merger had been fast tracked and will now join the fleet of the combined entity. Meanwhile, the one question that everyone seems to be asking is the announcement of the SBU (special business units) heads. When will the names be finally out? The grapevine has gone through all the permutations and combinations. But how does that matter? What matters is what does Mantriji want. For the record, he states that he does not get into the nitty-gritty. But for the record it may be mentioned that joint secretary in the ministry, R.K. Singh has told some informally what they are likely to
handle. So what does one make of it? If that is one issue, the mother of all issues—personnel—continues to be a huge headache for the combined entity. Thulasidas is on record that one job and one pay will be the norm. That settles the issue of pay parity, but what about designations and chores that personnel in the two divisions continue to handle separately? GMs in Air India grumble that their contemporaries or juniors are now executive directors in Indian and they will find it impossible to report to them. There is also the question of the five regional directors (RDs)—North America, Europe, Dubai, Southeast Asia and India—that is to be settled. At least two of these positions are expected to go to erstwhile Indian EDs. Some jockeying has begun for the slots, but it is still not clear who will get what. Similarly the RDs at the four domestic centres—East, West, North and South—may see a reshuffle, with two of the top jobs going to AI staffers. So plenty of churning, tossing, turning and string pulling is on at the moment. Perhaps the one big silver lining for the management is the fact that the airline has its unions sharply divided down the middle. Indian employees look to their unions for salvation and AI has its own platform. So far, the two are talking at cross-purposes and that means confusion on the one hand, but an easier-todeal-with situation on the other.
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Yechury in demand THE AIRPORT ECONOMIC REGULATORY AUTHORITY (AERA) BILL has finally been introduced in Lok Sabha by Praful Patel and promptly sent to a select committee by the Speaker. This committee is headed by the Parliamentary Standing Committee chairman Sitaram Yechury, of the CPM, who will now have to find time from his 123 adventure to get this bill off the ground and into the discussion and debate stage. So the good man will now have to find time to have several sittings to clear all the contentious issues and push for its adoption in the next session of the house— that could well be the last if things continue as they are politically. Tactically and strategically, Praful would like the intersession break to be used for
AERA to be fine-tuned. If that happens, then he will have to wait till the Budget session for AERA to become a reality. So what would Mantriji be doing? Using all his charm and friendship with Yechury to make sure he finds four days between now and November to thrash out all outstanding issues and send the bill back to the house with their recommendations. Is that possible? Very much so. But opponents of the bill are also keeping their powder dry. Not that they do not want a regulatory authority. It is just that they do not want it in its present form. And, of course, they want it delayed. Quite simply they do not want Praful Patel to walk with AERA and pack it with his candidates. That is something he will have to contend with.
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Mantriji’s economy
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WELL, FINALLY PRAFUL PATEL took a regular LCC trip. Not one of those inaugural flight junkets (to be fair, he has done plenty of them on the LCCs). Kolkata’s Telegraph described it simply as “Indian aviation (breaking) free of the Maharaja mindset, at least for a day.” Well, it so happened that on September 9, the civil aviation minister missed his early morning flight to the East Coast as he was late getting to the airport. And, wonder of wonders, the Jet Airways flight, on which he was scheduled to fly to Kolkata, took off without him and with his concurrence! Apparently Mantriji was caught in a traffic jam and it was clear he would be late for the flight. Jet Airways got in touch with him informing its decision to take off. Patel took the next available flight, which was an Air Deccan all-economy A320. In the West Bengal capital, officials were ready to receive Mantriji with bouquets and had allotted an aerobridge to the Jet Airways flight—a standard practice for VVIP flights. When it became known that he was on Air Deccan, an aerobridge was quickly allotted to the LCC. And what did Mantriji have to say of the experience? “I travelled by an Air Deccan flight today and was happy to see the change in the profile of passengers,” Patel later said.
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Falling yields Continental
Delta
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Jet
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I
T TAKES YEARS to build a product. Day after day, night after night, month after month and year after year airline workers have to sweat it out. Whether it is the ground staff or those in the sky, they all have to constantly wear a smile besides their sparkling uniform to present a product that is remembered and is always in the back of the mind for ready recall. This is apart from the excellent cuisine on board, which helps make such vital business recall doubly quick. Carriers like Singapore Airlines, Cathay Pacific, Emirates, Lufthansa, Virgin, Qantas and our own Jet Airways know how it is to build a premium product. The Maharaja had become synonymous with first-class service in the Sixties and Seventies and to some extent even in the Eighties. Something went wrong from the early Nineties, notwithstanding the golden days from 1991 to 1993 when Air India imported a corporate honcho, Yogi Deveshwar, who, as CMD, claimed credit for the airline making one crore rupees a day in profits. The next peak was in the second half of the 90s when the same Air India made losses of over Rs 400 crore. What went wrong—the product, pricing or sudden cold looks replacing the smiles? Perhaps these could be subject matter of research for some other time. At least in product pricing or what we normally call fares, the ever-vigilant DGCA always ensured there were no drastic cuts or discounting by foreign carriers. In a way this ensured that the national carrier was not needlessly burdened by factors beyond its control. All that changed in past few years, with DGCA being goaded to “guide” bilateral talks, doling out liberal rights to as many foreign carriers as one can imagine to provide greater freedom to Indians wanting to travel out or travel in. It is precisely such a liberal sky related fare war that may harm the Maharaja at a time when it is acquiring most modern World liner Boeing 777200 LR for its non-stop India-US flights. While it takes years to build a product and lot of planning to make that offering, as Air India has begun to do
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so, fares can be cut at the drop of a hat. This is what has precisely begun to happen on the India-US route. Delta cut basic economy class fare to slightly over Rs 26,000 for Mumbai-New YorkMumbai sector. Continental, which is about to launch Mumbai-NewarkMumbai flights from October 2, is also on a similar downward fare drive. Even though the fare offer is for limited period, there is likelihood of it being continued for two more months, till, say, end of the year, to create space in the fiercely competitive market. This has set off serious speculation that Air India, Jet Airways, Lufthansa and British Airways may also match it without regard for the consequences it will have. When we talk of impact, it is more to do with the likes of Air India and Jet Airways, with the latter, however, connecting US with a stopover at Brussels. Should one add fuel surcharge and other host of taxes, the actual fare may go up by, say, Rs 18,000. All total, the fare may come to Rs 44,000 during a fairly busy season as against the Rs 50,000 fare for the sector charged during the off-peak season. The fact that India-US traffic is now growing annually at 30 per cent, it is left to anyone’s imagination as to what kind of bloodbath it could turn out to be. Earlier, one believed that direct non-stop flights would be cheaper. However, what Delta and Continental are seeking to offer will put even the one-stop airlines flying through one of the prominent European gateways to the US at serious risk of falling yields. It remains to be seen how Air India, which has to earn to pay for its new aircraft, will tackle the situation. We can only offer our best wishes to the Maharaja, which, after decades, is now beginning to offer a product on the sector that those who have already used it say is world class. As for Jet Airways, which was talking of raising 50 per cent of its total revenue from international operations by 2010, this kind of predatory pricing could also impact it as it flies through its hub in Brussels before crossing the Atlantic to land in New York and some more ports in the months to come.
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Beautiful relationship and some issues
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T IS EXTREMELY difficult to gauge if Civil Aviation Minister Praful Patel is still thick with Jet’s Naresh Goyal or wants to share that beautiful relationship with Kingfisher’s Vijay Mallya also. News reports after the first postponed meeting of the GoM of August 14 to decide if government should reduce the waiting period from five to three years for domestic airlines to fly international suggested serious difference of opinion among its members. Further, there was also pressure for withdrawing the Gulf reservation for Air India and Indian, now Air India, beginning January 2008 to enable other domestic carriers to fly those routes as well. We may recall here that when Praful Patel first announced the five-year policy for allowing domestic private carriers to fly foreign routes on December 26, 2004, there were no protests, as Kingfisher had not begun to flap its wings.
When one journalist asked Patel if the five-year rule was sacrosanct, as changes may be required in near future, the minister said it was not sacrosanct. An economic daily reported that comment. Today it gives an impression that Praful Patel wants to hasten the process at somebody’s behest. We cannot say if it is true, but the fact remains that only one airline is forcing the issue and in the event of it not getting it, then it can always use the five years of its cousin, which it took over for only money and not love. But, then, what distinguishes this airline from the one it took over are both the product and the fares that we dis-
cussed in a different context when talking about Air India. But central ministers, like Lalu Yadav and his close associate Prem Gupta without getting into the issue of whether it is sacrosanct or not, feel that sanctity of the original cabinet decision should not be disturbed, as, after all, according to them, heavens will not fall. As a parallel, some bureaucrats in the finance ministry feel, the proposal before the cabinet was completely silent on allowing FDI by foreign airlines in domestic carriers. They feel this is both retrograde and unacceptable when FDI was being allowed in even high security areas like telecom and that too up to 74 per cent. The ministry of civil aviation has been arguing that no country allows such liberal FDI in its domestic airlines. But that is true for telecom as well and notwithstanding that the same UPA government has gone ahead. On the issue of allowing private carriers to fly international even if they have been in business for three years raises an important question. Officially there are six metros—Delhi, Mumbai, Kolkata, Chennai, Hyderabad and Bangalore. Many applicants are waiting for two years to receive their NoC from the ministry of civil aviation to start scheduled domestic airlines. None of them have heard from it even though informal press reports suggest that the ministry would like them to focus on regional airlines, a policy for which it even notified in late August 2007. One of the unstated and informal reasons advanced by the ministry to those in the waiting list was, “You are in the queue and will be allowed when infrastructure improves in the metros”. What a travesty of truth that the same argument has not been applied to those already in business from acquiring further aircraft and are even wanting to buy wide body 350 seaters and park them in the same infrastructure-constrained metro airports to launch their international flights? Yes, the ministry may argue that by March-April 2008 at least Hyderabad and Bangalore will become operational. Should that be the case, then why not allow those airline applicants who are only NRIs and not covertly or overtly driven by FDI that is not even remotely
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NEWS DIGEST connected to foreign airlines? By the way when the GoM met, a Spice official said, “We are also ready to fly foreign routes should the government okay it. He even said that it would be okayed before the year was over.” Meanwhile, Jet Airways has postponed its $400-million rights issue by three months due to unfavourable market conditions. The airline was planning to launch the issue in October to fund its expansion plans. “We have decided to postpone our plan to raise $400 million through a rights issue by two to three months,” Naresh Goyal told journalists. He said the timing of the rights issue had to be postponed due to the impact of the US sub-prime crisis on the stock market. “It is delayed by two to three months, but we are okay even without the rights issue,” Goyal added. In June, the Jet Airways’ board had approved raising up to $400 million by way of a rights issue to finance its expansion and revamp of Air Sahara, which has been rebranded as JetLite. Goyal, who owns 78.5 per cent stake in the airline through promoter group firms, maintained he would continue to remain the major stakeholder of the airline. Jet Airways is also looking for a partnership with Air India to cut costs. “We are open to partnering with Air India on all common facilities, such as ground handling, catering, engineering and maintenance,” Goyal said. The two airlines can also get into code sharing for international flights. “We along with Air India can jointly hold 50 per cent market share in the international traffic,” he said. Goyal said he would not be concerned if international routes are opened for start-up airlines. “We have faced competition and we would welcome competition,” he added. Effective this month, the airline also commenced a new flight linking Delhi with Toronto, via Brussels, five times a week. Flight 9W 226 will take off from Delhi at 0245 hours and arrive at Brussels International Airport at 0800 hours. This flight will then depart from Brussels International Airport at 0955 hours and arrive in Toronto Pearson International Airport at 1215 hours. The flight will operate daily except Tuesdays and Thursdays. Jet Airways will operate the Delhi-Brussels-Toronto flight with an A330-200 aircraft, which has been specially configured for international operations with 30 seats in Première and 190 seats in the Economy class.
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Southern safari
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N OUR AUGUST 2007 issue we had spoken of Tiger Air’s combo offer to fly to the far outback from Chennai and Kochi in a seamless fashion. Now yet another airline from Singapore—Silk Air—has decided to operate a weekly thrice service to and from Coimbatore to the city-state. The flights scheduled for Wednesday, Friday and Sunday will begin from October 28. Thus Coimbatore-Singapore flight service will become the second international connectivity for Coimbatore, known for its textile industries, besides the already three times a week service
operated by India between Coimbatore and Sharjah. Reports suggest that Sri Lankan Airlines is also planning to start a five-flights-a-week service to this southern city so that passengers can be taken to its Colombo hub before dispatching them to either Gulf/West or Southeast Asia. A Gulf-based carrier is planning to connect Coimbatore with Dubai. It is too early to say if it will be Emirates, which already has 81 flights a week to India. Sources said it might not be Emirates, as it would make no sense for it to compete with Sri Lankan Airlines, in which it holds 49 per cent stake.
North-East express
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he Northeast states, often known as the Seven Sisters, should soon be wreathed in smiles. Dedicated passenger airlines are likely to commence operating in the region soon. It could well mark the end of the region’s constant complaint of step motherly treatment and surviving on the crumbs of the airline biggies, which seem most disinclined to fly to the region. The North Eastern Council (NEC) has asked for bids; in response to which 12 airlines had submitted expressions of interest to launch new airlines. Kingfisher, Pawan Hans Helicopters and Alliance Air are among the carriers that have shown interest.
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It may be mentioned that one time Kingfisher palmed off their obligations to the region to Indian who fulfilled the liquor baron’s quota of mandatory flying to the region. All the carriers that have shown interest will be given bid documents, after which they will be allowed to formally bid. The winner will have to assure the NEC of efficient services. They are also likely to get the minimum subsidy available from the NEC. At present, NEC has a contract with Alliance Air, which expires in December 2007, to operate flights. This has been extended for another year-till the end of 2008-as it will take another six to eight months before the new airlines can start operating.
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AT A GLANCE
Takeaway before take-off
Dog bolts out of taxiing
t was 7.30 pm and passengers on an Air New Zealand flight were waiting to take off. When the intercom cackled, they were stunned when the pilots announced they would be delayed— because they had to take a meal break. The crew added they were legally entitled to a meal and their in-flight dinner had gone missing. The flight did not take off until around 8 pm. Passengers were kind of stoic and laughing. The pilot assured the passengers that he would keep the break short by getting takeaways. They actually saw him get off the plane and walk back into the terminal.
lue Air flight 115 to Bucharest, Romania, was taxiing to the runway at Roma-Fiumicino (FCO) when a dog escaped from its cargo hold. The flight crew of another aircraft spotted the dog and warned the controllers. As a result, the Boeing 737 was delayed for two hours. An official from the handling agent assumed that the dog had escaped from its cage and managed to unlock the cargo door from the inside.
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Mile-high mission
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BA ranked ‘worst’ airline in Europe
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R
ichard Branson, the 57-yearold chairman of Virgin Atlantic Airways, told Amit Roy of Kolkata’s Telegraph that he was a fully paid-up member of “the mile-high club” —a euphemism for those who claim to have had sex during a flight. It was not on one of his own planes, though, but when he was only 19 years old and flying to America on an airline operated by Freddie Laker, the British pioneer who dreamt up the novel concept of cheap transatlantic flights. “I was sitting in economy on a Freddie Laker flight, next to this very attractive lady, as we headed to LA,” said Branson, in an interview with GQ, a men’s magazine. “We got chatting and it went a bit further. And it was every man’s dream, to be honest. I was about 19, I think. “I remember getting off the plane and she turned to me and said, ‘Look, it’s slightly embarrassing but I am meeting my husband at
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arrivals, would you mind holding back a bit...’ But it was a memorable flight.” He added, “The problem with plane loos generally is that they are very small, and the acrobatics can’t take too long because there’s no room and people start banging on the door. What I remember vividly is seeing four handprints on the mirror as we finished, and thinking I’d better wipe them off.” In 2004, he introduced double beds on selected flights to America, a facility yet to be brought in on services to Mumbai and Delhi. Branson has always maintained that the next step—private bedrooms—would be easy to introduce on the A380. At the time, he said, “We have a lot of honeymoon couples who fly on Virgin, and a lot of couples who have been together for many years. There is no reason why they shouldn’t cuddle up on board like they would at home.” When the double beds idea was first floated, Branson rejected the charge that he was encouraging immoral behaviour. “The legitimate mile-high club is finally aboard. You can do it on cruise ships, you can do it at home, so why shouldn’t you be able to have relationships on planes?” CRUISING HEIGHTS September 2007
t couldn’t get worse for British Airways. After paying major penalties to regulators in the US and the UK for price rigging, the Association of European Airlines has rated the airline as the worst performing major European operator in a report. In the three months between April and June, 28 bags were held up for every 1,000 travellers. In the same period, 35.7 per cent of short-or medium-haul flights did not arrive on time and 32.7 per cent departed later than scheduled. The report found that British Airways’ punctuality on its long-haul flights was even worse, with 44 per cent late arrivals and 36.6 per cent departing late. A total of 28 airlines provided punctuality figures to the association, while 23 gave baggage details. A sample of its performance was available recently when a BA flight from Heathrow landed at Kolkata without the luggage of 60 of the 240 passengers on board. Red-faced BA officials contacted Heathrow, only to be told that the flight had taken off without the items.
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Illustrations by Rajeev Kumar
airplane
9/10/2007
Bullet talisman causes flutter in airport
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hree years ago, a local priest in Sharjah blessed a live bullet and gave it to Noor Prez Khalil to wear, as a pendant, for her heart problem. She created a flutter at the Anna international airport terminal recently when the metal detector raised an alarm. After repeated checks, they found to their surprise that her pendant was indeed a live bullet covered with a thread. The Q branch police dealing with terrorists allowed her to fly after they were satisfied that she had no connection whatsoever with any terrorist outfit. They however seized the bullet.
Is that a monkey in your ponytail?
Painting it over
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assengers aboard Spirit Airlines Flight 180 from Fort Lauderdale, Florida, to New York’s LaGuardia International Airport were in for a shock when they noticed a small monkey peeking on them from under a hat. A passenger, who originally departed from Lima, Peru, and connected in Fort Lauderdale, had been hiding the small monkey in his ponytail, under his hat. During the flight, the monkey crawled out of its hiding spot, forcing the owner to hold it in his hands, where the unexpected visitor was soon spotted by fellow passengers and crew members.
Fishy coating for aircraft wings
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esearchers in Germany have developed a fish proteinbased coating that would prevent ice from forming on the wings of aircraft during high-altitude flights. Antifreeze proteins found in plants, fish and insects have already been synthesised in the lab, and used to prevent foods from being damaged by icing up in the refrigerator. In addition to protecting aircraft, the paint could be used to prevent ice from dragging down power cables. It could even prevent freezers from icing up so that they do not need defrosting, the researchers said.
Announcing flights in 20 languages
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hina Airlines has painted over the company’s name on the left side of the aircraft and the flower symbol that was on the tail fin at the accident site at Naha airport, in Japan. Although investigators had cordoned off the crash site since the accident, China Airlines sought permission from the Aircraft Accident Investigation Committee to get rid of the symbols that were causing enormous bad publicity. The committee accepted the request, as it determined that it would not interfere with the ongoing investigation.
Eurostar claim banned
E
urostar has banned Ryanair from claiming its flight from London to Brussels is faster and cheaper than making the journey. The claim was considered misleading because it ignored time taken for travelling from city centres to airports, the Advertising Standards Authority (ASA) said. Ryanair’s advert compared its 70minute flight to a 131minute train journey, but travelling from the heart of London and Brussels would add an hour and 45 minutes to the journey, the ASA said. And costs for those journeys to and from airports at both ends of the journey meant that claims that Ryanair’s service was cheaper were also misleading.
Closer to god
omodedovo Airport, in Moscow, will announce flights in the languages of the countries planes belong to. It is going to be Hindi, Ukrainian, French, Italian, Spanish, Uzbek, Azerbaijani, German and other languages. The airport’s administration is sure that the innovation will make staying in the terminals more comfortable for passengers unable to speak neither Russian nor English. Up to the moment flights have been announced only in these two languages.
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ost of us would dread flying on a wing and a prayer, but the Pope has made it possible for pilgrims to utter prayers on the wing with his own discount airline. The Vatican is bringing its faithful 30,000 feet closer to heaven, albeit only for a few hours as it flies pilgrims to shrines and holy sites across the world. Mistral Air will bedeck the Boeing 737s in the Vatican colours of blue, yellow and white. The fuselage will carry the phrase, Looking for your face Lord.
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PERSPECTIVE
A heliport in the
Photo: Prasad
HEART OF THE CITY
When you think of it, it is surprising that so far no one has really recommended it. But now that the idea has been made, the ministry of civil aviation is plumping for the creation of a state-of-the-art heliport near the Akshardham Temple (above), near Mayur Vihar in East Delhi, to set up the country’s first heliport.
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AWAN HANS CHAIRMAN AND MANAGING DIRECTOR R.K. Tyagi, who first mooted the idea at a seminar and later followed it up vigorously with the ministry of civil aviation, has clearly won the first round. The ministry has enthusiastically endorsed his plans and forwarded them to the Delhi Development Authority for requisite allotment of land. Tyagi, who has energised the country’s public sector helicopter company since his arrival some four months back, has been on record that “the heliport could start operations in six months of getting all the required clearances.” If all goes well, the heliport is sched-
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If all goes well, the heliport is scheduled to start operations before the 2010 Commonwealth Games. CRUISING HEIGHTS September 2007
uled to start operations before the 2010 Commonwealth Games. Pawan Hans has also identified an alternative site on the other side of the Nizamuddin Bridge. With a runway, a hangar and a departure/arrival terminal, the heliport needs 40 acres of land. Believe it or not, it would cost Rs 15,000 to make a trip from Delhi to Agra and back, including time to see the Taj Mahal, in just four hours. Pawan Hans plans Taj packages, which would also include pick and drop in taxis from homes or hotels in Delhi. Apart from Agra, the company also wants to connect Delhi to Dehradun, Saharanpur, Jalandhar, Muzaffarnagar and other cities. For long there
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had been issues about setting up a heliport at Noida or Greater Noida because it fell in the arch of descent of aircraft coming in to land at Delhi’s Palam airport. By talking about Akshardham, Tyagi has, in one stroke, silenced the critics and created an opportunity for the dormant sector to literally take-off. Apart from flying its own choppers, Tyagi hopes the heliport will serve as a catalyst for a variety of end users, including hospitals/media agencies/industrialists and the law enforcement agencies, for using the facility to park their aircraft and fly from there. “Once such a facility is set up and the ease of operations experienced by end users, I am certain it will have a huge impact on helicopter services overall,” said Tyagi. As far as Noida and Greater Noida are concerned, Pawan Hans has suggested that a comparatively smaller heliport, of oneacre size, be constructed there. In keeping with the present mood in the ministry, Pawan Hans, while seeking to be the nodal agency for coordination and
“Once such a facility is set up and the ease of operations experienced by end users, I am certain it will have a huge impact on helicopter services overall.” — R.K. Tyagi Pawan Hans CMD
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other related activities with regard to identification and construction, operation and management of these heliports, acknowledged it would get heliports constructed on public-private partnership (PPP) model or through any other business model. In another related development, Pawan Hans is planning to fly a big chopper, like MI 172, or small 19- or 20-seater planes between Delhi and Dehradun and from there small choppers will provide linkage to the four big tourist and pilgrim centres: Valley of Flowers, Hemkunt Sahib, Kedarnath and Badrinath. The service is expected to begin in the summer of 2008. Talking about the project, Tyagi said, “The Delhi-Jolly Grant (in Dehradun) chopper flight would take about an hour and cost between Rs 1.20 lakh and Rs 1.30 lakh for an MI 172. For a 20-seater chopper, this cost would be about Rs 6,000 per head. As of now, we are looking at a cost of up to Rs 25,000 for flying a passenger from Delhi to Dehradun, from there to one more place of his choice and then back here.” This would essentially be a weekend package, with pilgrims or tourists leaving Delhi on Saturday morning and returning on Sunday night. They would also have the option of visiting any or all of the four chopper-linked places by extending their visit. A return trip from Gauchar or Dehradun to any of the four points is expected to cost up to Rs 6,000. Pawan Hans is getting a hangar built at Gauchar, in Garhwal, for establishing a base there. It had invited bids earlier for the job, but no one came forward because of the difficult terrain where the project is to be executed. Now it has asked CPWD, which has done lot of construction work in the hills, for building the hangar.
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SPECIAL REPORT
China, one of the fastest-growing markets for air travel and host for the next Olympic games, will be the first country in the world to operate an entirely paper-free ticketing system by the end of this year. How far are we from that goal?
GDSs move towards
PAPERLESS TRAVEL
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HE COUNTRY IS on track with the rest of the developing world as far as e-ticketing is concerned. As Ankur Bhatia, managing director, Amadeus, a global distribution system (GDS) and travel technology provider, puts it, “E-ticketing has grown from 40 per cent to 80-85 per cent today.” This has come about primarily due to technology being leveraged to accommodate trends. As business and leisure travel increases by the day, technology continues to play a major role in the
With more lowcost carriers going for e-ticketing, online growth will have a positive impact on all stakeholders
manner people travel across the globe. With the help of services like e-ticketing, delay reports, computerised back-office operations, global distribution systems have made flying a lot more easier. The GDS market has grown at about 30 per cent over the previous year. The growth has come about due to an increase in bookings, and that includes air as well as non-air bookings. With more low-cost carriers introducing e-ticketing as an option, Bruce Hanna, CEO of Galileo India, believes that “online growth will have a positive impact” on all stakeholders. Not only that, it will highlight and emphasise the importance of GDS as the most efficient and reliable distribution channel. In fact, International Air Transport Association (IATA), which represents more than 240 airlines that operate 94 per cent of scheduled international flights, has cleared the way for air travel to be based entirely on
“Amadeus is on track for paperless travel” A major force in the travel industry, Amadeus is a partner to service providers, sellers and buyers. Ankur Bhatia, speaks about the recent moves to achieve paperless travel. The country’s aviation sector has been seeing a growth that has never been seen before. What does that mean to Amadeus? Let us look at it this way. Eticketing has grown from 40 per cent to 80-85 per cent. For example, in 2003 around five million Indians were travelling out but in 2006, the number went up to around seven
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million. A lot of the growth has come from low-cost carriers and liberalisation of aviation policies. The Indian aviation market is estimated to be around Rs 25,000 crore and is growing very fast. Over the next few years, there will be more than 200 commercial aircraft flying in the Indian skies. E-ticketing, you say, has
CRUISING HEIGHTS September 2007
grown. How do you see the future? E-ticket is paperless travel. It is much more handy, providing a practical option for any air passenger. First and foremost, it need not be collected from an airline office or a travel agent. It is cheaper for airlines: the cost of issuing etickets can be reduced a lot. This will save airlines billions
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electronic ticketing from June 1, 2008. With e-ticket gaining acceptance, the technology is certain to have an effect as air travel becomes popular in the country. With more airlines coming in, both in the domestic as well as the international sector, the choice would be virtually unlimited. In the US, for example, there could be a choice of up to 800 different fares for a particular destination. Despite the smooth entry, e-ticketing has to face a number of hurdles. As Ankur Bhatia points out, security regulations prevalent at most airports often prevented genuine passengers from entering an airport, without a ticket. While the Bureau of Civil Aviation Security (BCAS) has approved the e-ticket concept and has listed the identity cards that a passenger could produce to enter an airport, problems do occur often. Bhatia, however, is hopeful that the day is not far off when Indian airports would resort to biometric and iris-recognition software. The other major hitch could come from the fact that a large majority of passengers still remain wary of credit-card bookings. Even so, the situation is changing fast, as passengers adopt the system and learn more about the convenience it affords. Whatever the advantages, travel agents have not taken too kindly to e-ticketing. With major mergers now in place—Air India and Indian, Jet and Sahara and Kingfisher and Deccan—it will not be long before these merged entities, in their efforts to improve yields, reduce travel agency commissions. However, there are a number of experts who believe that GDSs are not the last solution. This, despite the fact that IATA has set a deadline for paperless ticketing by June 2008. At best, GDSs are short-term measures for airlines in search of efficient of dollars every year. IATA wants all airlines to achieve paperless travel by 2007, and Amadeus is on track. It has enabled etickets for 153 airlines and 138 countries. For instance, in 2006 Amadeus implemented e-ticketing for over 50 airlines. Will e-tickets mean the end of travel agents? No, e-ticketing will reduce the workload on the travel agent since it will eliminate the process of generating paper tickets. It will also cut down on the cost of printing flight coupons. Travel agents can then focus on their core competence: advising tourists and travellers on best options available.
“GDS market share is growing” Bruce Hanna, on Galileo’s focus to provide a comprehensive package to travel agencies What has the impact of e-ticketing been on the GDS business in India? The growth that we have witnessed online has been good. All travel websites need a GDS to book airline tickets and we, at Galileo, have been striving to provide travel agencies with the right tools. We launched Galileo Web Services in the country and it has been received well. On an average, the GDS market grew 30 per cent over the previous year. Galileo India has achieved good results in the number of bookings, market share growth and customers. This year, 2007-08, we expect the growth to continue. The online segment will continue to grow. As for our airline partners, Galileo will continue to demonstrate value for money. What are the new products that have been planned? In 2006, Galileo launched Galileo Leisure, Galileo Flight Integrator, Galileo Web Services and Galileo Alerts. This year, we will try to popularise these products and launch some new ones, like Galileo Reach and Galileo E-Tracker. Additionally, there will also be a re-launch of the Low Fare Shopping Tool and Enhanced Dynamic E-ticketing. Do you feel that with most airlines reaching out directly to customers, the GDSs would be a thing of the past? If you were to buy directly from airlines, it would not only take too much time but also you might not get the best deal. The reason is there are too many airline sites and not enough time to search all. Comprehensive content is what a GDS provides and most airlines are realising the reach and extent of the GDSs. Today, even low-cost carriers are coming around to the view that they must join a GDS. Last year, for example, Kingfisher and SpiceJet joined the GDSs. SpiceJet is available exclusively to Galileo travel agents through Galileo Flight Integrator (GFI), which aggregates LCC content. GFI also offers Air Asia content to travel agents. The GDS business is undergoing rapid changes. The GDS market will certainly see pressure on revenues for all the players. However, that is a good sign since we have to be one step ahead of the competition. It will mean better products and solutions for customers. In turn, it will eventually bring guaranteed content on to a travel agent’s desktop. As for us, Galileo has both air and non-air content. According to a recent study, Galileo has also pioneered innovations and continues the trend with business innovations.
A recent white paper circulated in the travel industry has pointed out that there are tensions and complexities that are prevalent in the current distribution environment CRUISING HEIGHTS September 2007
access to airfare inventory. A recent white paper circulated in the travel industry has pointed out that there are tensions and complexities that are prevalent in the current distribution environment. These relate to GDS fees and unbundled pricing. However, the white paper has also stated that the present regime of GDSs remains the strongest, most efficient option for both customers and suppliers. The future of the GDSs will depend on how best they can incorporate new technologies that accommodate both supplier and end consumer expectations. Over the next few years, airlines will continue to focus on bringing down distribution costs on all fronts: through lower GDS fees or low merchant fees. In such a situation, travel management companies have to adopt active roles to aggregate content.
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Will the new ground-handling policy that is receiving some shape, be acceptable to the industry? How soon will it be notified? R. Krishnan provides an insight.
GROUND
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AKING THE REFORMs process further, the UPA government has approved a new policy on ground handling (GH) for various civilian airports in India. While the officials claim it is liberal, a reading of it, however, indicates its restrictive nature, as many private domestic airlines have complained over the past two months. Strangely, the policy received the approval of the GOI earlier this year, but for various reasons, the ministry of civil aviation has still not notified it because of stiff opposition from private airlines as well as from the ministry of home affairs from the security point of view. Till date, GH services have been and are being provided in various Indian airports by airlines themselves besides private parties. As it did not make economic sense for many foreign airlines, the ground-handling job had been contracted out to official Indian carriers—Air India and Indian—in all those cities they connect. This is besides the self-handling of their
D HANDLING PUZZLE
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own flights by the two official carriers. There are more than 6,000 workers employed by private Indian carriers to do GH in various airports in India. Most of these employees handle their respective flights. Before the new GH policy was approved, the two new greenfield airports coming up at Hyderabad and Bangalore floated their tenders inviting bids from GH service providers. Interestingly, the tender contained the following strange conditions: besides the airport promoter itself offering GH services in the airport concerned, two more GH agents will be chosen on bid basis. As per the condition, the Indian party submitting its bid must get a foreign JV partner, and should a foreign GH agent bid for the tender, then it should get an Indian JV partner. Further, it was also stated that should the Indian party be an airline, then it should get a foreign partner that is a nonairline and well versed in GH business. Alternatively, if the Indian GH bidder is a non-airline then it should get a foreign airline as a partner. Similarly, should a foreign airline bid, then it should get a nonairline Indian GH agent as partner and if it is a GH agent then it should get an Indian airline partner. Either way, it was made compulsory that a foreign partner should be included in the JV. In 2003, when the government was
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Before the new GH policy was approved, the two new greenfield airports coming up at Hyderabad and Bangalore floated their tenders inviting bids from GH service providers. CRUISING HEIGHTS September 2007
under the National Democratic Alliance, headed by Prime Minister Atal Bihari Vajpayee, its version of the GH policy clearly stated that foreign companies will not be allowed to get into GH business and if at all they were to be involved, they could come in as JV partners of the special purpose vehicle floated by the following public-sector companies—Air India, Indian Airlines and Airports Authority of India (AAI). This led to virulent protest from the private Indian carriers, which were, in a way, shut out from GH despite self-handling their own flights. This policy could never be implemented. Then came the UPA government under Dr Manmohan Singh with Praful Patel as the civil aviation minister in mid-2004. It started a new chapter in GH policy and got its own version of the policy cleared. The bottom line of its policy was that no private Indian carrier could do self-handling and the entire GH business would be in the hands of the official carriers (Air India and Indian Airlines), Airports Authority of India and the particular promoter of the new privately owned, operated and managed airport, like Hyderabad and Bangalore, and the one taken on lease from GOI, namely, Delhi and Mumbai airports. But during the time when the UPA government’s version of the new GH policy was announced in early part of 2007, the new airports coming up at Hyderabad
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The GH policy has at last seemingly acquired some shape after being subjected to many political twists and turns. The new policy has not been notified yet
H.C. Tiwari
and Bangalore had already floated tenders inviting bidders to bid for the GH job in the two airports respectively. For them it was important to seal the deal, as they are supposed to make their airports functional from March-April 2008. So the new policy, in a way, had to go along with their views and it did not speak of foreign parties being made JV partners and at the same time also did not object to tenders floated by them. At the same time, the ministry of civil aviation was actively trying to rope in Dubai-based Dnata, a subsidiary of Emirates, to partner with one of the two state owned carriers. Precisely at that time, the ministry of home affairs opposed the move and said Dnata could not be allowed for serious security reasons. Incidentally, Dnata’s offer to provide GH services in India had been rejected earlier as well when the previous NDA government had framed its version of GH policy. The GH policy has at last seemingly acquired some shape after being subjected to many political twists and turns. The new policy has not been notified for reasons stated above. But its details are as follows: Government will ensure competitive environment for GH services at all airports, including the greenfield ones. Airport operators will be
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required to encourage healthy competition in order to provide greater choices to the airlines for GH services in pursuance of this objective, following entities will be eligible to undertake GH at metropolitan airports. The metropolitan airports defined for this purpose are the following: Delhi, Mumbai, Chennai, Kolkata, Hyderabad and Bangalore. The respective airport operator (AAI or other operators, as the case may be) itself or its joint venture. Subsidiary companies of the national carriers or their JVs specialised in GH services. Third-party handling will also be permitted to these subsidiaries or their JVs on the basis of revenue sharing with airport operator subject to satisfactory observance of performance standards as may be mutually acceptable to the airport operator and these companies. Any other GH service providers selected through competitive bidding on revenue-sharing basis by the airport operator subject to security clearance by the government or observance of performance stan-
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dards as may be laid down by the airport operator. Self-handling at the international airports by the foreign airlines having minimum 14 flights or services per week to and from that airport in India. It will be ensured that at all metropolitan airports, there will be a minimum of two authorised GH service providers in addition to the subsidiaries of Air India and Indian Airlines. At other airports, in addition to the entities mentioned above, self-handling will also be permitted to the airlines. Airlines or entities presently involved in GH and which are not covered under the above policy will not be permitted to undertake self-
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At all metro airports, there will be two authorised GH service providers in addition to the subsidiaries of Air India and Indian Airlines CRUISING HEIGHTS September 2007
handling or third-party handling with effect from January 1, 2009. The policy is now clear. Even the clause on so-called mandatory foreign GH agent, as mentioned in tenders floated in 2006 by GMR Hyderabad International Airport Limited and Bangalore International Airport Limited, to be inducted as a JV partner has been done away with. It can also be stated that there is complete silence on this clause. This is without prejudice to the fact that expert foreign GH agencies do indeed possess the technology and equipment to ensure very efficient ground handling operations in busy airports, like Changi and Dubai. Perhaps this was one of the trig-
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FUNDAMENTAL ISSUES: The renovated and up market domestic terminal at Mumbai airport—AAI’s last chore—before it handed it over to the GVK-led MIAL. (Top) V. Thulasidas, Vijay Mallya and Vishwapati Trivedi. Air India is now combining with Singapore Airlines for ground handling. A path-breaking venture first initialled by former CMD Sunil Arora. His deal with Kingfisher, which brought in a cool Rs 100 crore to Indian, has also been cancelled by the Kingfisher boss.
gers for Air India to tie up with Singapore Airport Terminal Services (SATS) to win the bid for providing GH services in the upcoming new greenfield airport at Bangalore. With Air India-Indian merger formalised, there will be only two agencies providing GH services—the airport promoter concerned and Air India (the new name of the merged entities). It is for this reason both Air India and Indian Airlines are combining their offers and forging as a single entity in order to partner with a foreign GH agent. Consequently it is now strongly believed that for even Hyderabad airport, it will be a JV between Air India and SATS. The same arrangement may be extended to
With Air IndiaIndian merger formalised, there will be only two agencies providing GH services—the airport promoter concerned and Air India. It is for this reason both Air India and Indian Airlines are combining their offers and forging as a single entity in order to partner with a foreign GH agent. CRUISING HEIGHTS September 2007
Delhi, Mumbai, Chennai and Kolkata. What is not known is what will happen when the second and even third new airports come up at these metros five years from now? Further, what will be the policy in other non-metro airports where traffic may grow exponentially, like Jaipur, Ahmedabad, Amritsar, Coimbatore, Pune, etc., as these are fast emerging important commercial centres. For instance, Amritsar is attracting more than 50 international flights a week, which include Singapore Airlines, Malaysian, Jet, Air India and private charters. The question is will the government allow self-handling in these airports? These are issues that will acquire some clarity once the GOI gives its final seal of approval to the new civil aviation policy that is pending before the Empowered Group of Ministers. The issue may also acquire urgency should the ministry of civil aviation succeed in pushing through its agenda of reducing the waiting time for flying international routes from the existing five years to three. In such an event, SpiceJet, Air Deccan and Kingfisher will want to set up a complete network to service their international operations, of which GH will be the critical link.
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Air crash dilemmas In a unique conference, aviation experts, both Indian and international, highlight problems faced during and after air crashes
DEBATING RELIEF: Participants at the first-of-its-kind conference discuss air crashes in India
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N A FIRST-OF-ITS-KIND conference in the country held on August 31, Aviation Watch and International Foundation for Aviation and Development (IFFAAD), a non-profit forum, focused on the implications of air crashes on victims and their families. The meet— Air Crash: Issues of Relief and Compensation to Victims and Families Legal, Medical, Technical, Insurance, Liabilities, Compensation and Relief— brought together Indian and international experts specialising in legal, medical, technical, insurance and other aspects of relief and compensation for air travel. The conference dealt with the intricate issues of air safety and issues of relief and compensation. While experts talked about myriad issues of air travel relief and compensation, there were air crash survivors and next of kin of crash victims, who spoke eloquently about their experiences and the immediate need for sensitivity and adequate compensation. Among the issues that were deliberated upon were domestic laws governing compensation, the role of medical and disaster management agencies, and facilities and contingency plans by airlines and airports and
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The conference dealt with the intricate issues of air safety and issues of relief and compensation. There were air crash survivors and next of kin of crash victims, who spoke eloquently about their experiences. CRUISING HEIGHTS September 2007
infrastructure providers. It also discussed the obligations of rescue agencies, the procedures stipulated, legislations, conventions and protocols covering air safety and security, the non-ratification of the Montreal Convention 1999 by India and its implication in denial of full relief to victims of Indian nationality. Sanat Kaul, chairman, IFFAAD, and former joint secretary in the civil aviation ministry, pointed out that if an Indian and a foreigner died in an air crash, the kin of the latter would get 17 times more compensation than the former’s. The reason for such a glaring discrimination is that India is yet to ratify the Montreal Convention, which ensures higher compensation for the air passengers in case of an accident. “India is a signatory to it (Montreal Convention), but is yet to ratify it. Thus, regrettably, our own laws have discriminated against our own citizens. This situation must be rectified,” said Kaul. As per the convention, “approximately Rs 70 lakh is payable by the airline on death irrespective of the fault”. Above that, the compensation may also include “payments based on the ‘presumption of fault’ of the carrier,” said Kaul.
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Signed by 78 countries, the Montreal Convention, 1999, is regarded as the most effective compensation mechanism for the air-crash victims till date. It unifies most of the international regulations regarding compensation. “A passenger cannot derive full benefit of international treaties till his country has ratified the convention under which compensation is being sought,” said Kaul. Besides Harry Dhaul, directorgeneral, Aviation Watch, and Kaul, the speakers included Justice (Retd) J.D. Kapoor, presiding officer, State Consumer Disputes Redressal Commission; H.S. Khola, former DGCA; Subhash Goyal, Stic Travels; Dan Soffin, founding partner, Gates & Partners (Solicitors), UK; Urbon Olson (Solicitors), Sweden; Satinder Singh, former DGCA; Dr Ranjana Kaul, partner, Dua Associates; Grp Capt A. Thapliyal, Directorate of Flight Safety, IAF; K.P. Maggon, director, Regulations & Information, DGCA; Dr S.P. Agrawal, secretary-general, Indian Red Cross; T.N. Kumar, general manager, legal, National Aviation Co. of India Ltd; S.K. Mishra, chairman, INTACH; Air Marshal (Retd) Ashok Goel; Rashmi Iyer, ICICI Lombard; and S. Bhasker, Sr VP, Willis BA India Pvt Ltd. Besides, the
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RAPT ATTENTION: International delegates at the conference
conference was also witness to the heart wrenching and emotional story of Geetha Tom, who is next of kin of a victim in the recent Kenya air crash, and the experiences of Nalini Khandelwal and Manoj Kasliwal, who spoke about the horrifying experiences in surviving a recent air crash at Indore.
IATO convention looks at the future Indian Association of Tour Operators discusses challenges confronting its business
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he Indian Association of Tour Operators (IATO) celebrated its silver jubilee convention between September 1 and 3. The three-day convention saw delegates from national and international tourism bodies congregating to discuss important issues. The meet was held in the backdrop of the travel business margins getting smaller. With the theme, Indian Tour Operator’s Global Challenges, the convention discussed ways out of the situation. According to Subhash Goyal, IATO president, “Tour operators have been slowly becoming an endangered species. In order to remain in business, we had to look into the challenges and identify immediate measures so that our future is secure.” Inaugurating the convention, the Minister of Tourism and Culture Ambika Soni called upon tour operators to sustain
the boom in tourism through effective planning and coordination within the industry. She told them that the tourism sector had a multiplier effect on the economy and its contribution to the GDP
FUTURE STRATEGY: IATO president Subhash Goyal (left) looks on as Tourism Minister Ambika Soni lights the lamp
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was one of the highest. The sector had the ability to generate employment in bigger numbers than the IT sector. According to the Tourist Satellite Account System, the sector has generated about 50 million jobs directly or indirectly in last three years. The minister advised the tour operators to take cognisance of the need to maintain the ecological balance while pursuing eco, adventure and wildlife tourism. She also urged the tour operators to support the tourism ministry’s campaigns for a clean environment and anti-graffiti at monuments. Some of the key issues discussed at the meet: Acquisition and mergers concerning players in the tourism industry. Adverse effects of growing terrorism on travel and tourism. Improving infrastructure in the hospitality segment. Utilising agricultural land in various cities (especially Delhi) to construct hotels. Encouraging e-tourism in India.
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HAI summit strategises ON OPERATIONS IN HOTEL INDUSTRY Hospitality industry leaders share their views and perceptions with the country’s hoteliers
HOSPITALITY SUMMIT: On the dais are Jyotsna Suri, Raymond Bickson, N.K. Singh, Priya Paul, Nakul Anand and Ghassan Aidi
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HE FIRST-EVER SUMMIT of the Indian hospitality industry, held under the auspices of the Hotel Association of India on August 2324 at New Delhi, was attended by over two hundred leading industry players representing the whole range—from one-star to five-star deluxe—of hotel categories in the country. Among the owners and CEOs of leading hotel groups who attended the meet were P.R.S. Oberoi, chairman, Oberoi Hotels; Raymond Bickson, managing director, Taj Group of Hotels; Priya Paul, president of the association and chairperson, Apeejay Surrendra Park Hotels; Nakul Anand, divisional chief executive, ITC Hotels; and Jyotsna Suri, chairperson of Bharat Hotels Ltd. Also present was the International Hotel and Restaurant Association president, Dr Ghassan Aidi. Minister for Tourism and Culture, Ambika Soni, in her inaugural address, set the road map for deliberations at the conclave and stressed the need for the industry players to involve the common man in scripting a new success story for the tourism sector and creating a more vibrant public-private partnership in the travel and tourism business. She emphasised the urgency of developing qualitative manpower in the tourism sector and
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Ambika Soni set the road map for deliberations at the conclave and stressed the need for the industry players to involve the common man in scripting a new success story for the tourism sector and creating a more vibrant public-private partnership. CRUISING HEIGHTS September 2007
raised the issue of Guides, the need to augment their numbers, range and quality. She introduced a new dimension in training of Guides by urging hotels to participate in the training of students as Guides. She declared, “I want hotels to popularise the concept of students Guides earning-while-learning and create a well-trained cadre of Guides.” In her presidential address, Priya Paul highlighted the serious bottlenecks of land scarcity, high taxation rates and infrastructural inadequacies that have been hampering the growth of the tourism sector. She struck a note of optimism in the future growth of the sector by a “more focused and collective public-private partnership between the government and the industry to overcome the constraints and harness the immense potential of tourism sector to contribute to the growth of national economy”. The conclave, divided into eight sessions, saw participants address issues as diverse as ‘Marketing India’ to ‘What Does the Customer Really Want’; from ‘Strategy: Balancing Development with SAY IT WITH FLOWERS: Priya Paul (right) welcomes tourism minister Ambika Soni
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Awards for tourism and hospitality
AWARD-WINNERS ALL: Aviation Minister Praful Patel handing over the Hospitality India International awards, 2007 to the recipients on August 24, 2007.
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HE THIRD EDITION of Hospitality India Annual International Awards 2007 was held recently. Praful Patel, civil aviation minister, was the chief guest at the award function and Peter de Jong, president, Pacific Asia Travel Association (PATA), was the guest of honour. Both addressed the 500-plus industry leaders and participants on the opportunities and challenges facing the Indian travel and tourism sector. They also gave away awards to the winners from various segments of the travel and tourism industry. Addressing the gathering, the managing editor of Hospitality India, D.L. Kalra, Operations’ to ‘Retaining and Rewarding Talent’; from ‘Food for Thought— the Way the World Will Eat’ to “Design in Hospitality’. The owners and CEOs of hotel groups interacted with professional managers in the session aptly titled ‘A View from the Top’ and gave a holistic view of initiatives taken and success achieved by leading corporate hotel companies. Raymond Bickson gave an overview of his efforts to create
said that the vision of Hospitality India Annual International Awards was to stimulate a competitive spirit towards qualitative growth of the Indian hospitality, tourism and travel industries. The awards recognised the efforts of institutions and individuals in providing value to products and enhancing professionalism in services. Speaking on the occasion, Praful Patel said that all segments associated with the tourism industry, such as civil aviation, the hospitality sector, travel agents and tour operators, transporters and other service providers, must work in unison for the success of the several initiatives taken for the promotion of tourism. Peter de Jong pointed out in his speech that India had emerged as a tourism powerhouse due to its strong, consumption-driven economy, a large and increasingly affluent middle class and the on-going liberalisation of the air transport sector. This has not been without challenges and there would undoubtedly be more to come. In order to remain competitive in this highly volatile world and to realise the full potential of India as a premier destination, the tourism industry needed individuals and organisations and determination to see those strategies successfully executed. This year the annual awards format had been given a broader scope and were no longer limited to the domestic segment of the industries, but covered international majors operating in India. The title of the Awards had been rechristened as Hospitality India Annual International Awards. The event was supported by tourism, travel and hospitality organisations such as PATA FHRAI, TAAI, TAFI, ATOI, ADTOI, HRANI, HAI and IATO, apart from the captains of the industry and other international associations and organisations. The event also drew participants from all the state tourism ministries/departments, hotels, airlines, travel agents and tour operators and all those connected with the tourism and hospitality industries across the country.
A unique feature of the panel discussions was the involvement of over forty leading experts from various hospitality sectors. CRUISING HEIGHTS September 2007
hotels to cater to the need of the tourists from up market to budget travellers and Priya Paul highlighted the need for design innovations in hotel projects for discerning world-class travellers. Jyotsna Suri highlighted the importance of human capital in hospitality sector and stressed on the need to develop skilled manpower resource and training in hoteliering and catering to meet the growing demand of the industry. A unique feature of the panel discussions was the involvement of over forty leading experts from various related sectors, who led the discussions as speakers and moderators in the interac tive sessions.
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India Post’s mission TO THE NORTHEAST Air India’s first dedicated freighter took to the skies recently, marking a new chapter in the country’s domestic express services. Tirthankar Ghosh reports.
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HEN INDIA POST’S Boeing 737-200 flew on to the tarmac of Lokpriya Gopinath Bordoloi International Airport, Guwahati, on August 29, it created history on two counts: it was the first freighter of the Indian postal department and it was also the first domestic cargo carrier of the recently merged Air India. It was indeed a historic day. I.M.G. Khan, secretary to the Department of Posts, Government of India, put it candidly when he said that the postal department often faced the wrath of customers from the Northeast region because of delayed delivery of mails. The air service would, therefore, herald a new chapter in the history of the postal department. India Post is in overdrive to take a big bite of the express market: it leased the Boeing from Air India for express shipments to the northeast of the country with Kolkata as its regional hub. The lease and maintenance costs for the freighter are expected to cost the department at least Rs 48 crore. “In addition to an initial one-time expenditure of Rs 12 crore for the lease of the aircraft, around Rs 36 crore will be incurred on this account every year,” Shakeel Ahmad, minister of state for communications and information technology, had said in reply to a question in Parliament. The amount includes fuel charges, handling charges and other operational expenses. The aircraft, displaying the logos of Air India and India Post, is the first among six Air India aircraft that have been converted into freighters. According to the Department of Posts (DoP), India Post has plans to connect all the metro cities with this air freighter service in phases on the basis of the volume of services by the end of this financial year. In fact, the DoP has big plans. Speaking to newspersons at the launch ceremony, Khan said, “We need to induct more aircraft to take the air freighter service forward across the country.” And,
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in the event of Air India not providing freighters, DoP, he said, would go to private operators. India Post has decided in principle to induct four more aircraft by 2011 for servicing its other sectors. A year in the making, the India Post air cargo project has come at a time when the DoP has been making concerted efforts to improve its mail network and infrastructure in the Northeastern states to provide a better quality of postal services. India Post serves as a vital communication link between the seven sister states of the Northeast and Sikkim with the rest of the country.
The utilisation of dedicated freighters for carrying mail has become a worldwide practice for many postal administrations
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The utilisation of dedicated freighters for carrying mail has become a worldwide practice, and many postal administrations have benefitted from it. India Post took the competition from private courier organisations head on when it floated a tender for the lease of an aircraft. Incidentally, Indian (this was before the merger of Indian and Air India) was the only organisation that showed interest in the lease when an expression of interest was called for. The freighter, which can carry a payload of approximately 15 tonnes at a time, has started operations from Kolkata as the regional hub. Hitherto, only two domestic couriers—Blue Dart and First Flight— operate aircraft. Blue Dart, according to reports, carries a total of around eight million shipments to the northeastern region and the load is entirely in-bound. At least 100 tonnes of cargo is being booked daily for the seven northeastern states and India Post’s order books are full. India Post flies the cargo plane from Kolkata in the morning, drops courier packets and parcels at Agartala and Imphal and returns to Kolkata in the evening. With its own aircraft, India Post has not only undergone an image makeover but also cut down on logistics costs. The service would certainly take the wind out of the sails of private couriers. In fact, the postal department has gone on record to state that it does not face any competition. With annual revenue of Rs 7,000 crore, the DoP is indeed far ahead of others. Adding value to its airfreight service, India Post has also launched tracking of consignment to their final destination using the bar-code technology. The lease of the Boeing by India Post, for a year, is not a one-off move by Air India. With around a dozen of the existing aircraft being converted into freighters, Air India would probably have unutilised capacity. In a recent move, Air India said it would deliver five freighters, for an undisclosed amount, to Hyderabad-based express logistics firm Gati by November end. Under the agreement, Gati and Indian (now Air India) would jointly do branding, advertisement and launch-related activities. The ground handling, crew, maintenance and insurance would also be provided by Air India. Taking a leaf out of India Post, Germany’s Deutsche Post and Lufthansa’s airfreight division have planned to establish a joint cargo carrier. A spokesman for DHL Express delivery division said, without giving further details, there would be an enhancement of cooperation with Lufthansa. In fact, Lufthansa Cargo and DHL Express have operated a network together between Europe, Asia and the US
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DHL’s last mile with a little help from India Post
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he growing economy of the country has encouraged a number of players in the air cargo sector to take a stake. In a move that is certain to benefit consumers, international express and postal giant-Deutsche Post (DHL’s parent concern)-has started talks to tie up with India Post. Although only a few details of the joint talks have filtered through, what is certain is that DHL would like to take advantage of India Post’s vast footprint across the nation. In fact, according to industry experts, DHL could not have asked for a better deal. The express major’s operation, for the moment, is restricted mainly to the urban areas in the country and the tie-up, if and when it takes place, will enable it to penetrate the farthest corners of the country. DHL will leverage India Post’s infrastructural facility for its last mile delivery operations. It will be a quid pro quo: while DHL would benefit from India Post’s network, it would, in turn, provide its high technological capabilities to the staid and traditional organisation. While DHL is known in the country because of its presence through its 81 per cent ownership of air express operator Blue Dart, but even its
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operations are restricted to urban areas. Along with Blue Dart, there is First Flight Courier, which has its own aircraft, but none of them operate in the Northeast. According to officials from the Department of Posts, a few round of talks with Deutsche Post have already been held. The areas in which both entities could extend and utilise each other’s strengths have been singled out. The idea is to identify some common synergies and work towards creating a relationship, which might take shape in the form of either a strategic partnership, a JV or a memorandum of understanding that will come once the final structure of the relationship is finalised. One of the reasons that DHL has been looking at India stems from the fact that developed nations have been shifting their sights from China. In the DHL Export Barometer, released in Australia recently, for example, 56 per cent foresaw an increase from India. DHL’s barometer is based on a survey of 364 exporting firms in Australia. From a low base just five years ago, India is now Australia’s fastest growing trade partner. Exports to India have grown at an annual rate of 27 per cent over the past five years.
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since March 2004, a large part of which is due later this year to start operating out of Leipzig/Halle Airport, where DHL Express is moving its main European hub. It is not only in Germany that the postal department is going for aircraft. The Brazilian postal service has emerged as a potential launch customer for Embraer’s proposed C-390 tactical transport aircraft. The country’s postal department, Empresa de Correios e Telégrafos (ECT), may launch its own cargo carrier next year to meet its domestic transport requirements. The airline would initially operate a fleet of five aircraft, which could grow to between 20 and 25 by early next decade. The ECT is yet to select an aircraft type, but Embraer’s C-390 tactical transport aircraft is under consideration due to its favourable payload compared with other freighters in its class.
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he transformation from the traditional mode of sending mail as general cargo to the dynamic express mode started in the West over thirty years ago. Express services certainly added value to customer service. In India, in the new millennium, express services have made entrance in a big way, primarily due to the upward swing of international trade and services. The Rs 2,500 crore express market of 2003-04 has now grown to hit the size of Rs 7,000 crore. In fact, according to industry experts, the country’s express market will be one of the fastest growing around the world over the next few years with growth in the 15-25 per cent range. The fast economic growth—12.7 per cent in 2006 and expected to grow at an average annual rate of 13.8 per cent until 2010—has driven domestic demand as well as generated strong increases in imports and exports. According to Express Industry Council of India (EICI), the apex body of Indian express industry, around 2004, the organised sector of express industry constituted 65 per cent of market share, semiorganised along with unorganised sector made 25 per cent, and the governmentowned EMS Speed Post accounted for the rest. During the 1990s, the express industry in India witnessed progressive growth. Changing economic scenario, due to removal of trade barriers, globalisation of markets and trades, led to increase in international business. This saw entry of almost all global express majors into India, equipped with technology-driven, value-added service products meeting various needs of customers. In due course, express products became more attractive, as the user companies and other customers found them cheaper and best comparable
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Vishwapati Trivedi, joint managing director, Air India (with black shirt), presenting a postal bag to the minister for communications and information Technology, A. Raja, during the inauguration of the India Post Freighter service at Guwahati on August 29.
with government postal service; qualityenhanced service by express operators; carried-as-promised by reputed carriers; faster and JIT delivery; confirmation of delivery; saving on time and money; efficient and professionalised, self-motivated staff; accountability; technology-driven trace-and-track info; and failure in many aspects of government-owned postal service. The major players in the sector have enhanced services with major investments. DHL, for example, expanded its fleet with two B757Fs and has opened new air hubs. Within this year, Blue Dart will be starting 57 new services and operational facilities and most of it will be focused on air-based express services. European major TNT Express, which announced a Euro 100 million, five-year investment programme for India early in 2006, has undertaken two major steps towards emerging as a strong Number Two in the India express market by 2010. It entered the domestic air express market in early 2006 and then acquired the fastgrowing road express company Speedage recently. The domestic air services, using commercial capacity, offer time-definite and day-definite delivery. US-based FedEx has also cashed in on the growth in the country. It has international air express offerings from its two gateways—Mumbai and Delhi—and it does so with 16 MD-11F flights in and out per week. In a strategic move, it acquired
The country’s express market will be one of the fastest growing over the next few years. The fast economic growth—12.7 per cent in 2006 and expected to grow at an average annual rate of 13.8 per cent until 2010—has driven domestic demand and generated imports and exports. CRUISING HEIGHTS September 2007
Prakash Air Freight (Pafex), its Indian service partner, this year. The acquisition has given FedEx the platform to grow in the domestic market, and to increase synergies with its core international business. The other US integrator, UPS, has yet to make any acquisition in India. It operates through UPS Jetair Express, a joint venture with the Jetair airline sales group that was set up in 2000. UPS launched next-day delivery to Europe and the USA from Mumbai last June with non-stop MD11F flights from Mumbai to Cologne and on to Louisville. Shipments from other Indian regions have a guaranteed 48-hour delivery time. UPS operates eight weekly flights from Mumbai, using six MD-11s and two B767s. Domestically, it is focusing on the fast-growing retail sector with plans for up to 150 UPS Stores by 2011. In India, the future express market estimate is based on factors such as overall growth in Indian economy of around eight per cent; growth in domestic business owing to rise in banking and other service sectors; growth in IT-enabled services and India as a hub for IT and BPO activities; expected rise in international trade; and past growth trends of organised sector players in express industry. Based on assumptions, and going by present trend, the Indian express industry is expected to grow at a healthy rate of around 20 to 25 per cent in the coming years to reach a size exceeding Rs 7,000 crore by the year 2007-08.
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Emirates looks to start freighter services from Kolkata KOLKATA IS SLOWLY but steadily being recognised as a centre for the air cargo industry. The city’s strategic location has been attracting a large number of air carriers, all intent to start cargo services from the city. Kolkata saw a 15 per cent growth last year, with flowers, fish, fresh fruits and vegetables making up a major share of the products, most of it going to the Gulf. In addition, Kolkata exports processed leather and leather goods, which comprise about 55 per cent of the total exports, and jewellery crafted by goldsmiths in West Bengal. One of the airlines that is readying to start freighter services to and from Kolkata is Emirates, which presently operates passenger services from the city to Dubai. It has seen a 19 per cent growth in exports in the first half of the year. To top it all, recently about 40 tonnes of flower bulbs from Kalimpong, in south Bengal, were ferried in a month from Kolkata to Dubai on passenger flights. Speaking about Kolkata, Emirates Skycargo senior vice-president Ram C. Menen said, “The demand for perishables is on the rise … There is tremendous growth potential in Eastern India and freighter operations from Kolkata are on the drawing board.” Emirates has, in fact, been conducting surveys before drawing up detailed plans. For the moment,
Amritsar airport gears up to handle cargo growth AMRITSAR’S RAJA SANSI INTERNATIONAL AIRPORT is geared to handle up to 1,500 tonnes of cargo. Hitherto, cargo handling through this airport—the fastest growing international airport in India—has been a mere 200 tonnes. The Airports Authority of India has leased the cargo terminal to a private entrepreneur, JAC Air Services, to handle all cargo-related activities. Even though the cargo facility has been in existence for more than five years, it had not seen much business. According to JAC Air Services managing director Lalit Jobanputra, the airport could look forward to big business growth. From the first month, August 2007, it has orders in place. Once the cargo handling operations smoothen, more manufacturers around Punjab and neighbouring states would prefer to send their products from Amritsar rather than from Delhi.
Cargoitalia loves India ITALY’S ALL-CARGO PRIVATE carrier, Cargoitalia, is looking forward to good business this year. Its flights to India are becoming popular as CEO Massimo Panagia said recently. “We have a strong India presence, and our interest is confirmed by the opening of five Cargoitalia offices in Delhi, Mumbai, Chennai, Coimbatore and Dhaka, in Bangladesh (which falls in the Indian sphere of operations).” After barely a year of operations, Cargoitalia serves 16 scheduled destinations spanning across the world—from Europe and Africa to America, Southeast Asia and Japan, but India is
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Singapore Airlines operates two freighters a week from Kolkata. But, said Menen, “Once the cold storage facility comes at the new cargo terminal in Kolkata, exports will receive further boost.” Emirates Skycargo is all set to add 19 planes to its 11-freighter fleet over the next six years. The carrier operates freighters from Dubai to Delhi, Mumbai and Chennai now, but in view of the fast growth, it could link Kolkata to a cargo hub in China. special for Panagia. While Cargoitalia touches only Shanghai in China, in India it flies to a number of cities. “We currently fly to three destinations in the area,” he said. The Indian market, said Panagia, “has very high potential. We look at this market as our main trade lane”. In Cargoitalia’s scheme of things, the Indian Subcontinent was top priority. “We offer, between import and export, over 400 tones per week to the Indian Subcontinent … Our development plan for the future will also focus on the Indian Subcontinent market,” Panagia said.
Jet Airways targets Irish cargo market JET AIRWAYS CARGO has extended its links to Ireland. The carrier has introduced an overnight express road feeder to all major airports in Ireland. Following the introduction of a route from London to Mumbai, the carrier is now able to offer customers the option to transfer cargo to various destinations in Ireland. Jet Airways has employed International Airline Marketing (IAM) to act as sales agent in the region. According to Ian McCool, managing director of IAM, “Jet Airways is still a relatively unknown quantity here, but we aim to change that. This is a quality carrier with a very young fleet and a determination to make its mark.” Jet Airways Cargo currently operates 14 flights per week from London to Mumbai using B777s. The aircraft has a palletised cargo capacity of 22 tonnes with a full passenger load on the Mumbai to London route.
Cargo exempt from Chinese ban CARGO AIRLINES HAVE been exempt from the Chinese government’s plans to ban new start-up airlines. China’s Civil Aviation Authority said it will not approve any new airlines until 2010 amid fears that its skies are becoming too crowded. It is concerned that airlines will jump on the Olympic bandwagon and that safety may suffer as a result. Safety controls will be tightened and flights cut from its busiest hub, Beijing Airport.
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NATIONAL AIR DECCAN NEWS Honours centenary of Tata Steel: The low-cost carrier has launched a flight connecting Jamshedpur to Kolkata to mark the centenary celebrations of Tata Steel. The special inaugural flight landed at Jamshedpur airport on August 26. The Steel City’s airport is one of the three cleared by the civil aviation ministry last month to operate flights as private airports. The others are Mundra and Vijaynagaram, which has a flight from Bangalore
B. Muthuraman and Ramki Sundaram flagging off the first Jamshedpur-Kolkata flight
connecting the world-famous Hampi ruins. Even that, too, is connected by an Air Deccan ATR turboprop. Interestingly, buoyed by the government’s green signal, the Tatas are scouting for a bigger piece of land on the outskirts of Jamshedpur for a bigger airport that can see A320s and 737s land in the Steel City. “We believe in greenfield projects that serve long-term requirements rather than to meet short-term demand. Tata Steel will continue to upgrade the infrastructure in Jamshedpur and a new airport is part of the blueprint,” Muthuraman said, adding that the runway length would be 7,500 feet to allow operation of bigger aircraft. There will be future provision to extend the runway to 10,000 feet. The cost could be around Rs 1,000 crore. Revamps fleet to achieve time efficiency: Air Deccan has returned two old 48-seater ATR 42-320 aircraft, and is in the process of phasing out its older ATR aircraft in a planned manner. These will be replaced with the new generation ATR 72-500 fleet. It had inducted the ATR 42-320 and ATR 42-500 aircraft as these had lower lease rentals, were affordable and well suited for non-metro routes. The new aircraft consist of the brandnew 180 seater Airbus A320 aircraft and the latest generation turboprop, the 72 seater ATR 72-500 aircraft. Returning old ATR aircraft Air Deccan now has a fleet of 43 aircraft, comprising 20 brand new Airbus and 12 brand new ATR 72 aircraft. CRUISING HEIGHTS September 2007
InterGlobe redesigns itself INTERGLOBE AIR TRANSPORT has redesigned itself to adapt to the changing needs of the global travel industry. It has initiated a series of employee engagement and development programmes across levels to nurture and prepare its workforce for a promising future. In order to further align businesses and functionality, the company will also appoint a new Leadership Council that will support the president & CEO to strategically lead the business. With this change InterGlobe Air Transport has created a clear business vision and focus by structuring itself into focused business departments that include International Passenger Services, Domestic Passenger Services, Cargo Services, Airport Services, Travel & Leisure Services, Business Development, Synergy Management, and Marketing & Communications.
Ashok Fenn, president & CEO, InterGlobe Air Transport said, “With several drivers for change and with an intent to stay ahead and competitive in a rapidly evolving market, InterGlobe Air Transport has taken a progressive strategic step in the right direction, continuing to set benchmarks in the industry. By creating strong business focused departments and broad banding our leadership team, we are confident that a functional alignment will bring us greater efficiencies and make us a strong contributor to economic growth.”
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Club One Air launches new programme CLUB ONE AIR, a charter and ‘Aircraft Fractional Ownership’ company, has launched Aircraft Maintenance Programme, which is tailored to meet the aircraft ownership needs of the business aviation community. The programme is designed to encompass
the complete management of aircraft—from aircraft selection, its purchase, to complete aircraft operations and everything in-between. With the introduction of this programme, Club One Air will be the only company in the country to cater to all business aviation requirements, from charter to ownership. This new programme from Club One Air will enable the business community to fulfil its needs of owning aircraft.
JET AIRWAYS NEWS Partners with Citibank for flyer programme: JET AIRWAYS AND Citibank have extended their partnership by enhancing features on their co-branded credit card. The cobranded credit card allows members to accrue miles optimally—four JPMiles for every Rs 100 spend, as well as the flexibility of accumulating JPMiles on spends on a vast range of options, such as consumer durables, home essentials, dining out at restaurants and more. The JPMiles thus earned can be redeemed for free flights and upgrades under the award winning Jet Airways’ JetPrivilege frequent flyer programme. Wins SAP ACE 2007: Jet Airways has been awarded the prestigious SAP ACE 2007Award for Customer Excellence, in the Best Travel & Transportation Sector Implementation category. The awards were announced by SAP INDIA (Systems, Applications and Products in Data Processing), an arm of SAP AG, the world’s largest business software company headquartered in Germany, having more than 41,200 customers worldwide. SAP India honoured the Best Run Businesses that are setting global benchmarks in excellence at SAP ACE 2007 awards at a function held in New Delhi recently. Jet Airways received this award for Project E3, which stands for Efficiency, Empowerment and Effectiveness. This was realised by contributions made by the key internal departments of Jet Airways, like finance, human resources, purchase, ground services, management information, information systems and communications. The highlight of the project was the business warehouse implementation to generate the route profitability report and the revenue model to support the sales/revenue management teams. The main objectives were: Building a business intelligence environment giving the company a single source of accurate management information. Creating a central data repository meeting different departments’ requirements, enabling meaningful analysis. Provide a holistic view of business. Setting up such a system gives the airline’s senior management accurate updates on the performance of each route/flight flown by the airline within a short timeframe, which is a major achievement in the airline industry. The SAP ACE awards evaluation process comprised of four stages, including scrutiny of the nomination form, short-listing via interviews, on-site review and final assessment by the jury after a detailed panel discussion.
Kingfisher to provide Internet on long-haul flights BY 2008, KINGFISHER AIRLINES’ long-haul passengers will be able to use Webmail OnAir and Webchat OnAir. In 2009, the airline will provide Internet and Mobile OnAir to access the Internet during flights. Passengers can send and receive emails and make and receive phone calls. At the Aircraft Interiors Expo Asia, held recently in Hong Kong, the airline selected OnAir to provide a full
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range of passenger communication services. OnAir’s services will initially be installed in five new A330s and five new A340s, with plans in place to instal the system across its entire long-range fleet. Kingfisher Airlines will use its A330s on routes to Europe and Asia, while the A340s will service longer non-stop flights, such as to the USA. According to Hitesh Patel, executive vice president, Kingfisher Airlines, the carrier would be the first in the world to offer its guests all of OnAir’s communications services. The service is based on an onboard server and is connected to the ground infrastructure through SwiftBroadband, Inmarsat’s broadband satellite infrastructure.
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INTERNATIONAL Emirates News Concludes tests with Airbus: Seeking to familiarise its staff with the world’s largest commercial passenger aircraft, the A380, Emirates, jointly with Airbus, conducted four test flights that brought into play all key units of the airline, such as airport services, inflight catering, cabin crew, flight operations, cargo, in-flight systems, engineering and maintenance, group Security and Dnata airport operations. The tests, numbering a
Lipman to address PATA board on climate change HOW TO RESPOND to climate change-this will be the focus of the PATA board of directors and committee meetings in Bali, Indonesia, on September 29-30. UNWTO assistant secretary-general Geoffrey Lipman will set the tone for the meetings by explaining to PATA board and advisory committee members how and why UNWTO and other major stakeholders intend to address climate change. Lipman will talk about the vital link between the activities of UNWTO and PATA, including the Second International Conference on Climate Change and Tourism, in Davos, Switzerland, this October, and PATA’s CEO Challenge: Confronting Climate Change in Bangkok next April. Louis Thompson, group permaculturist and director of Built Environment for Six Senses Hotels, Resorts & Spas, will then show how his company has taken practical steps to deal with climate change. Six Sens-
hundred, were spread over seven days and involved more than 2,000 people. From the time the test campaign was conceived, Emirates was clear that the tests must be as real as possible and conducted under typical airline conditions. Two of the test flights were operated in the morning when Dubai International Airport is at its busiest, followed by two flights later in the afternoon. The flights, each two hours in duration and flown over the UAE, were operated at almost 80 per cent load factor—the average seat factor experienced by the Dubai-based airline. Stages road shows: The Airline is staging a transcontinental road show blitz to support a flurry of route launches across the world. Involving trade presentations, dinner functions and press briefings, it is a series of events to publicise the latest additions to the airline’s global footprint. So far promotions have taken place in Sao Paulo, Rio, Newcastle in the UK, Houston and Miami in the US, and will take place this month in Dallas, Toronto, Calgary and Ahmedabad. During the second half of 2007, Emirates has plans to launch a total of six new routes. It launched Venice on July 1, and proposes to launch Newcastle (September 1), Sao Paulo (October 1), Ahmedabad (October 28), Toronto (October 29) and Houston (December 3).
Cathay Pacific adopts Altéa CMS CATHAY PACIFIC AIRWAYS has signed a ten-year contract with Amadeus, which will see the carrier and its subsidiary, Dragonair, adopt the complete Altéa Customer Management Solution (CMS) to manage their passenger service chain, including reservations, inventory and departure control systems. The deal will be used to support the airline’s growth strategy and to increase operational efficiency. The airline, which already uses Amadeus’ Internet booking engine to power its commercial website, has identified IT as a core component of its strategy as it seeks to expand operations and continue to grow in some of the world’s fastest growing aviation markets, such as China, as well as the US and Europe. With this deal, Cathay Pacific Airways and Dragonair join 42 airlines across the globe that have selected Altéa CMS. CRUISING HEIGHTS September 2007
es won the 2007 PATA Grand Award for Environment. PATA president and CEO Peter de Jong said the theme-setting session would stimulate debate in the category and advisory committees on the most appropriate sector-specific and industry responses to climate change.
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Malaysia Airlines crew voted best MALAYSIA AIRLINES WON the ‘World’s Best Cabin Staff’ award at the World Airlines Award 2007, organised by Skytrax. The Malaysian national carrier took the top position in this 11-month survey, conducted between August 2006 and June 2007. The cabin staff regained the award that they won for several years in the past. Focused on the quality of onboard customer experience, the survey also looked at the ‘soft service’ provided, including cabin staff friendliness, enthusiasm and attentiveness, sincerity as well as consistency in service delivery, in addition to the usual general service efficiency. The worldwide survey data for this award involved more than three million respondents representing over 90 different passenger nationalities.
American star chef creates menus for Lufthansa THIS MONTH AND the next, culinary delights devised by David Bouley will find their way into the first and business classes of Lufthansa. Among the main dishes served in first class are filet of halibut in black truffled dashi stock served with palm hearts, silver onions, shiitake mushrooms and baby bokchoy or saddle of veal with herbed mushrooms, baby carrots, Brussels sprouts and Langres cheese potato purée. The choice for passengers in business class includes fried slices of salmon with Meaux mustard sauce, celery and apple purée and steamed Savoy cabbage or savoury beef goulash, quark spaetzle and carrots with herbs. David Bouley was born in Connecticut and discovered his love of cooking at a young age. Often he would help his grandmother in the kitchen, but his cooking skills were polished and refined in France. In 1985 the New York Times awarded three stars to the Montrachet restaurant, where Bouley was working at the time as chef de cuisine.
Kuwait Airways to touch Hyderabad KUWAIT AIRWAYS is all set to expand its India operation with addition of Hyderabad as its new destination. The city will be added to the airline’s network this November with most likely service of three-four flights. The carrier is also looking to add one more flight to Ahmedabad, taking the overall flights to four.
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Singapore Airlines appoints new personnel
Manager for Eastern India: The airline has announced the appointment of Vinod Kannan as the new manager for its Eastern India operations. Based in Kolkata, Kannan will be responsible for the operations of Singapore Airlines in the city. He would also be overseeing Singapore Airlines’ sales and marketing efforts in Jharkhand, Bihar, Orissa and the Northeastern states. Prior to taking over the present post, he worked as passenger sales manager for the airline in Singapore. Karnataka manager: The airline has appointed Louis Leonard Arul as its new state manager for Karnataka. He will be based in Bangalore and will be responsible for overseeing the operations of Singapore Airlines in Karnataka. Arul has been with Singapore Airlines for over thirteen years and is equipped with rich experience in the fields of marketing communications and international relations. Prior to taking over his current role, he worked as the marketing communications manager with the company in Singapore.
Air Arabia announces net profit for first half THE AIRLINE has announced its financial results for the first half of 2007. The company’s net profit for the six months ending June 30 stood at AED 115 million, a 342 per cent increase compared to AED 26 million for the first six months of last year. During the first half of 2007, the company registered a turnover of AED 513 million, up 67 per cent from AED 307 million for the first half of 2006. Air Arabia’s net profit increased 66 per cent between the first quarter of 2007 and the second quarter of 2007, from AED 43.3 million in Q1 to AED 71.7 million in Q2. Passenger traffic reached 6,46,000 during the second quarter of 2007, up 11.5 per cent compared to 5,80,000 passengers during the first quarter of 2007. Commenting on India’s contribution to the overall growth of the low cost carrier, Adel Ali, CEO and board member of Air Arabia, said, “India has been a key market as far as Air Arabia’s growth is concerned.”
Bindra is Malaysia Airlines’ marketing manager
MALAYSIA AIRLINES recently announced the promotion of Devinder Singh Bindra as the new marketing manager for South Asia Region. Prior to this, he was serving Malaysia Airlines as Sales Manager North India. With 15 years of industry experience, he would be responsible for planning, managing and implementing marketing activities for the airline in South Asia region. He will be stationed at Malaysia Airlines South Asia head office in New Delhi. CRUISING HEIGHTS September 2007
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TRAVEL & TOURISM Sri Lanka Tourism’s social responsibility service project
Association and Tourist Shops Association, among others.
SRI LANKA TOURIST BOARD has unveiled plans for a new project, designed to raise Sri Lanka’s profile as a destination, offering socially and environmentally responsible tourism. Outlining the rationale behind the ‘Sri Lanka Tourism’s Social Responsibility Service Project’, Renton de Alwis, chairman of the tourist board, said that today’s brands needed to ensure they met the highest ethical and environmental standards to stay competitive. The new plan focuses on local communities and a key objective is building community support in the development of tourism. To this end, the plan aims to link communities with tourism activities to ensure the benefit from tourism actually contributes towards sustainable community development. Visitors to Sri Lanka who are interested will be able to take part in a community service project in one of five broad areas—carbon offsetting, child welfare, animal welfare, peace education, and facilitation for the differently abled. In doing so, they will be able to have the satisfaction of being involved in a worthy cause while on holiday. To achieve this, the Sri Lanka Tourist Board intends creating a special trust fund with the assistance of all major stakeholders as trustees. The stakeholders will include Board of Airlines (BAR), Sri Lanka Association of Inbound Tour Operators (SLAITO), Tourist Hotels Association of Sri Lanka (THASL), Tour Agents Association of Sri Lanka (TAASL), Association of Small and Medium Enterprise in Tourism (ASMET), Sri Lanka in Style, Institute of Tour Guide, Lecturers, Chauffeurs
YATRA.COM HAS unveiled its mobile travel offerings—providing air ticket bookings in a convenient manner over mobile handsets. The company intends to introduce hotel bookings, car rentals and bus bookings on the mobile phone shortly. Branded as Yatra.com on the Go!, it has three products targeted at distinct customer segments—SMS for customers who do not carry a GPRS (General Packet Radio Service) enabled handset; searching and booking air tickets using wap.yatra.com, Yatra.com’s WAP portal; and a downloadable client application.
Yatra.com launches its mobile offering
Registration for ITB Asia starts OCTOBER 2008 WILL mark the debut of ITB Asia, the new marketplace for the global travel industry, aimed primarily at buyers from the Asia-Pacific region and taking place annually in Singapore as the Asian meeting platform for the travel industry. The three-day B2B trade show will be accompanied by a convention and will take place from October 22-24, 2008. In addition to traditional travel products, ITB Asia will also focus on the rapidly expanding areas of MICE (Meetings, Incentives, Conventions and Events) as well as business travel. Stands can be booked at ITB Asia for prices beginning at US $250 per square metre. An overview of the prices together with application documents can be downloaded from www.itb-asia.com/Exhibitor Centre/ Products.
Sahara joins hands with Carlson
CNTA opens India office AS PER THE action plan chalked out between the two countries as part of ‘India-China Year of Friendship through Tourism 2007’, China National Tourism Administration (CNTA) has opened its India office recently. The inauguration was attended, among others, by Ambika Soni, Union minister for tourism & culture, and Shao Qiwei, chairman, CNTA. As part of the CNTA office opening, the India-China Tourism Forum met and discussed ways to increase people-to-people exchanges between the two nations in the coming years.
SAHARA INDIA CLUB ROYALE CORPORATION LIMITED, the hotel business wing of Sahara Infrastructure and Housing, has entered into a management and licence agreement with Carl-
son Hotels Worldwide to establish Radisson Hotel at Sahara City Homes, Lucknow. Situated at Sahara City Homes, Lucknow Township, the hotel will be called Radisson Hotel Lucknow Sahara City Homes. To be constructed and owned by Sahara India Club Royale Corporation Limited, the hotel would operate under licence from Radisson Hotels International USA, a fully owned subsidiary of Carlson Hotels Worldwide. Construction will commence shortly and become operational by first quarter of 2010. The investment on the project is about Rs 100 crore.
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SNIPPETS Central government raises abatement rate PROVIDING SOME RELIEF to the travel trade, especially tour operators and travel agents offering package tours to the inbound, the central government has issued notifications hiking the rate of abatement from the current 60 per cent to 75 per cent while calculating the service tax. With this the tour operators henceforth will be required to pay service tax only on 25 per cent of the gross amount charged to customers, instead of the earlier 40 per cent.
Sarawak Regatta scheduled this month SARAWAK REGATTA, the significant annual event for Sarawak State Tourism Board, takes place at Kuching Waterfront from September 1-2. Sarawak Regatta is the popular extension of traditional Baram Regatta through which the Malaysians celebrate true sportsman spirit by competing against each other in varied water sports. The event is a reflection of Sarawak regional tribes’ past practices, which, in the ancient times, established their tribe’s supremacy by competing against each other in water sports, specifically boat racing. The competition involves indigenous inhabitants of Sarawak as well as enthusiastic participants from the neighbouring region. These participants test their skill and endurance in paddleboat, powerboat and canoe competitions along the Sarawak river. Positioned as the ecological getaway, Sarawak is a paradise for adventure seekers. Jungle treks, mountain biking, adventure caves, scuba diving, snorkelling and sailing are amongst the genre activities to choose and explore from while vacationing in Sarawak.
Choice Hotels on expansion track CHOICE HOTELS IS coming up with four new properties by next year. The first property, to be launched in January next year in Ludhiana, under the Clarion brand, is an all-suite, 120-room
venture. The two other properties coming up under the Comfort Inn brand are in Delhi and Haldwani. The fourth property coming up this year is a 75-room venture in Chennai. Apart from this Choice Hotels intends to launch 10 more properties by the end of 2009. It has also tied up with an NRI company—Royal Indian Raj—to build 120 hotels in the next five to seven years. As per the contract, Choice Hotels would be managing and maintaining the hotels.
Sun-n-Sand enters Goa WITH THREE HOTELS already running in cities like Pune, Mumbai and Shirdi, Sun-n-Sand is all set to open its new venture in the beach city of India, Goa. The unique feature of this hotel is that the whole building is based on a single rock. The main hotel starts from the third floor. With a repertoire of 43 rooms and the city of Panjim as the base, the hotel intends to cater to the needs of domestic and international business and leisure travellers.
South India tour package TAMILNADU TOURISM HAS announced the launching of a 14-day rail-road package tour covering major destinations of the south, targeting the North Indian market. The tour— New Delhi-Chennai-New Delhi—will comprise travel by train from New Delhi to Chennai and sightseeing by road by hi-tech luxury air-conditioned/non air-conditioned coaches to popular destinations of South India. These include Kancheepuram, Udhagamandalam, Coimbatore, Kanyakumari, Madurai, Rameswaram, Thanjavur and Mamallapuram in Tamilnadu; Tirupati in Andhra Pradesh; Bangalore and Mysore in Karnataka; and Kochi and Thiruvananthapuram in Kerala.
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It’s the greeeenest one W
HAT IS COMMON among Frederic Schwartz Architects, Hargreaves Associates, Gensler and New Delhi-based Creative Group? Well, this is the team of firms the Airports Authority of India has chosen to expand Chennai international airport’s domestic and international terminals. When completed in 2010, the $300 million project will transform Chennai into India’s greenest airport. So what are the high points of their design? Traveler and employee will circulate around two lush sustainable gardens, each measuring nearly an acre apiece. The roofs fold downward to form the garden’s walls, delivering rainwater during the wet season to series of runnels and cistern pools that store water for dry season irrigation. Directly connected to the new terminal, a new parking garage with a sculpturally folding green roof welcomes travelers with as a ‘green gate’ and adorned with local plants. Statistically speaking, it will mean: Enhanced passenger capacity (10 million to 30 million) The new terminal building will measure more than 140,000 sq mts. There will be 140 check-in counters, 60 immigration counters, 7 security gates (3 international, 4 domestic), 4 conveyor belts and 7 aerobridges.
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