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TRANSPORT CIVIL AVIATION General 9.25.1 The civil aviation sector is structured into two distinct functional entities - operational and infrastructural. Indian Airlines (IA) and Vavudoot provide domestic air services and Air India (AI) provides international air services. Indian Airlines also cover some neighbouring countries. The infrastructural facilities are provided by National Airports Authority (NAA) and International Airports Authority of India (IAA1). The IAAI now runs five major metropolitan airports namely, Bombay, Delhi, Calcutta, Madras and Trivandrum. The NAA manages 88 airports and civilian enclaves at 28 defence airports. 9.25.2 Significant developments took place during the Seventh Plan period in the field of civil aviation, with the setting up of NAA and Pawan Hans Ltd. The NAA started functioning with effect from 1st June, 1986. The main functions of this Authority are to manage the aerodromes, all civil enclaves and aeronautical communication systems efficiently. After the NAA came into being, the Directorate General of Civil Aviation has been left with regulatory functions only. 9.23.3 A new company Pawan Hans Ltd. was incorporated in 1985 to acquire and operate helicopters in the country. The main functions of this company are to plan, provide, develop air support services to meet the requirements of Oil Sector in their offshore operations. To cater to the requirements of skilled manpower, Indira Gandhi Rashtriya Uran Academy (IGRUA) at Fursatganj, Uttar Pradesh was set up. 9.25.4 Annexure - 9.8 gives the details of outlay and expenditure during Seventh Plan and Annual Plans 1990-91 and 1991-92 for the different constituent units in the Civil Aviation Sector. 9.25.5 An outlay of Rs.3998 crores has been approved for Eighth Plan (1992-97). About 97 percent of the outlay would be met from Internal and extra budgetary resources and the balance will lie met from budgetary support. Air India, Indian Airlines, International Airports Authority of India, Pawan Hans and National Airports Authority to some extent will meet their outlays from their own internal resources. The DGCA, Bureau of Civil Aviation Security (BCAS) will TABLE
- 9.17 Capacity and Traffic - Air India
receive budgetary support. The outlay for IGRUA and Hotel Corporation of India will he met from inter- corporate contributions. In the state sector, an outlay of Rs 107.93 crores has been provided for civil aviation in the Eidith Plan. * 9.25.6 Air India has come a long way since its establishment as a statutory corporation in 1953. Table 9.17 indicates the growth in capacity and traffic carried by Air India. 9.25.7 The fleet of Air India at the end of the Seventh Plan (1989-90) consisted of 21 aircrafts comprising ten B747-200's, six A310 aircraft, two B747 combis and three A 300-B4. In addition, it took one B747F on wet lease for freighter operation and one IL-62M for passenger operations on India-USSR route. One IL-76 was also used for addition to freighter capacity. Air India carried over 2.15 million passengers during 1990-91. 9.25.8 As against growth rate of 4 per cent per annum, in the Seventh Plan, the growth rate in terms of traffic has been around 3 per cent per annum. In the last year of Sixth Plan, Air India was operating at a-Joss. This position changed in the course of the Seventh Plan as can be seen from Table- 9.18 9.25.9 Though this is a reasonable financial performance, the airline suffers from several weaknesses and there is potential for improvement. Its share of international traffic from and to India has gradually declined from 42 per cent in 1981 to 35 per cent during the Seventh Plan. The overall load factor also is low, compared to other similar sized carriers of the world. 9.25.10 Air India is expected to have a traffic growth at a rate of 14.4 per cent during the Eighth Plan (1992-97). In terms of targets, the capacity available at the end of the Eighth Plan would be 3061.6 million tonne kms and anticipated capacity utilisation would be 1983.3 million revenue tonne kms. It plans to augment its aircraft capacity in the Eighth Plan with the acquisition of four Boeing 747 aircraft. It acquired two A310-300 aircraft in August, 1990. It would formulate a fleet renewal plan to have a modern and young fleet. Efforts would he made to improve its load factor and market share in the carriage of international cargo, by following appropriate measures including expansion of capacity. Air India can gain appreciably by improving its cargo handling capability. Improvement in cargo handling facilities would be made through better consignment tracking and retrieval systems. This will help reduce the total transportation time. Indian Airlines 9.25.11 Indian Airlines Corporation (IAC) came into existence in June, 1953 when eight scheduled air transport companies were nationalised. It provides air services on the domestic routes and operates 57 stations in the country and ten stations in the neighbouring countries. Table - 9.19 indicates the growth in capacity, traffic carried and load factor achieved by Indian Airlines. Table - 9.19 Capacity and Traffic - Indian Airlines (In million)
Table
- 9.18 Air India - Financial Performance
TABLE - 9.20 Financial Performance - Indian Airlines
9.25.12 IAC fleet at the end of the Seventh Plan (1989-90) consisted of 11 Airbus A-300, 24 Boeing-737, 14 A-320, 3 HS-748 and 4 F-27. During 1989-90, 15 A-320's were acquired of which one was lost in an accident in February 1990. 9.25.13 The Seventh Plan had anticipated a growth rate of 8 per cent per annum in traffic for the Indian Airlines. The actual growth rate has been around 5 per cent per annum. Table -9.20 indicates the financial performance since 1980. 9.25.14 The overall performance of the Corporation was below expectations during the Seventh Plan. A thorough review of the Airlines and its services is suggested to make it financially viable. 9.25.15 Indian Airlines has projected domestic passenger growth rates of 8 percent per annum in Eighth Plan with 1989-90 as the base year. In terms of targets,Indian Airlines would have capacity equivalent to 1916 million. Available tonne kms and traffic of 1361 million Revenue tonne kms. by the end of the Eighth Plan (1992-97). ii) Rationalisation of fare structure needs to be undertaken particularly on short haul routes to make it cost oriented. It is advisable to adopt the Long Run Marginal Cost principle of pricing for domestic air services. Subsidisation of air services in regions other than the North East and inaccessible areas is not desirable. iii) Improvement in productivity of aircraft by improving maintenance schedules so as to reduce aircraft down time to the minimum and improving the turn round time at the airports is necessary. (iv) An element of competition in the provision of domestic air services is desirable. Private airlines should operate on routes which cater to genuine passenger and tourist traffic. This will lead to improvement in efficiency of air services. International Airports Authority of India (IAAI) 9.25.16 The IAAI came into being in February, 1972 to manage, operate and develop the four international airports at Bombay, Calcutta, Delhi and Madras. Trivandrum became an international airport in April 1991. During the Seventh Plan period, new international terminal complexes at Bombay and Delhi and domestic terminal at Madras were developed. The IAAI has done well both in respect of physical as well as financial performance during the Seventh Plan. It was able to finance its developmental activities from out of its own resources. Table 9.21 gives details of financial and physical performance. 9.25.17 The main thrust of IAAI during the Eighth Plan will be on optimisation of capacity utilisation, creation of necessary additional capacities through modular constructions and improving the quality of service to passengers. The infrastructure requirement for international cargo, especially for sustaining exports would need to be met. Maintenance of facilities and equipment should be given adequate attention. The new major passenger terminals to be taken up are Domestic Terminal Module-1 at Delhi, International Terminal Complex (Phase-111) at Bombay and new Domestic terminal (Phase-11) at Madras. TABLE - 9.21 Physical and Financial Performance - IAAI
National Airports Authority (NAA) 9.25.18 The NAA provides services such as air traffic, navigational, communication, rescue, runway, apron and terminal at all domestic aerodromes. The provision of air traffic control services, radio, navigation aids, communication services etc. at the four international airports is also the responsibility of NAA. The major scheme during the Eighth Plan is the project for modernisation of Delhi and Bombay airports with an estimated cost of Rs. 210crores. Investment in N.E.C. 9.25.19 As per a decision taken in December, 1988, N.E.C. (North Eastern Council) bears 60% of expenditure for development of airports in that region and N.A.A. bears 40%. About Rs. 140 crores worth of schemes are proposed to be taken up during the Eighth Plan for the North Eastern Region. Vayudoot 9.25.20 Vayudoot, the third level airline was established in January, 1981 as a subsidiary of Air India and Indian Airlines. This airline was originally conceived to serve the north-east region where the surface transport facilities are inadequate and surface routes are circuituous. Subsequently,the services of Vayudoot had been extended to other regions also. This had adversely affected its financial performance. After a review, the number of stations on the operational network was brought down to 48 as on 31st March 1991. 9.25.21 Vayudoot has a fleet of eight Dornier aircraft, eight Avro and one Fokker aircraft; Vayudoot also has an Agro Aviation Division which is involved in aerial spraying operations, seeding and afforestation operations. It has a fleet of one helicopter and sixteen aircrafts. Vayudoot's financial performance is not satisfactory. Table - 9.22 indicates its physical and financial performance. 9.25.22 Vayudoot would concentrate on consolidation of its operations and rationalisation of its fare structure rather than embark on large scale expansion of its net work. Its operations would be restricted to North-Eastern region and other inaccessible areas. Pawan Hans 9.25.23 Pawan Hans which was incorporated in 1985 acquired 48 helicopters, consisting of 27 Dauphin and 21 Westland helicopters. Of these, 6 Dauphin helicopters were transferred to State Governments of Uttar Pradesh, Madhya Pradesh, Bihar and Gujarat. Four helicopters were lost in accidents in 1988-89 and the Corporation presently has a fleet of 38 helicopters consisting of 19 Dauphin and 19 Westland helicopters. The Westland helicopters which have been grounded for a prolonged period are proposed to be phased out by 1992-93. Table -9.22 Physical and Financial Performance - Vayudoot
9.25.24 The primary users of helicopters are ONGC, NTPC etc. Considering the high operation cost and foreign exchange outgo in maintenance and operations,it is necessary that the helicopter services are primarily restricted to oil exploration sector. The provision of maintenance facilities would have to be accorded priority over acquisition of additional helicopters. The thrust in the Eighth Plan would be on enhanced maintenance capability, man-power development and coordination of the growth of Pawan Hans with its special markets. Directorate General of Civil Aviation 9.25.25 The main thrust during the Eighth Plan is on stepping up regulatory control through reorganisation, expansion of existing disciplines and development of human resources through intensive advanced training. It would also replace overaged trainer aircraft in Flying Clubs. Indira Gandhi Rashtriya Uran Academy (IGRUA) 9.25.26 The I.G.R.U.A was set up to provide training for commercial pilots. The Academy located at Fursatganj, U.P is equipped with modern training aids including aircraft, helicopters and flight simulator etc. 9.25.27 With the increase in the capacity of the national airlines and operation of air taxis, IGRUA is expected to play an increasingly important role in the Eighth Plan in the matter of training of pilots and other technical personnel. Hotel Corporation of India 9.25.28 The Hotel Corporation of India is wholly owned by Air India. It operates a chain of hotels located at Bombay, Delhi, Srinagarand Rajgir besides flight catering units at Bombay and Delhi. Its financial performance has not been satisfactory. Gradual privatisation and/or collaboration with other units would be explored. Major Thrust areas in the Eighth Plan 9.26.1 The civil aviation sector should aim at being financially self-sustaining. Efforts to generate larger internal resources will be made. 9.26.2 Private sector will he encouraged to cater to the growing demand for air services on short haul routes. Air taxis will also be encouraged on tourist routes. 9.26.3 Air services for distances less than 300 kms are likely to be uneconomical as compared to surface modes. Efforts will be made to identify short haul corridors where good surface transport connections can be introduced as an alternative to air services. 9.26.4 The tariff structures of the domestic carriers are not cost related. The telescopic gradient of fares between short and long haul sectors are low compared to those in other countries. A steeper gradient, which reflects higher costs on short haul is desirable. The adoption of the long run marginal cost principle in pricing of air services is recommended. 9.26.5 There is a growing mismatch between airline requirements and ground support facilities. Priority will be given to upgrading infrastructure and modernising communication facilities to permit full utilisation of aircraft capacity. Maintenance of infrastructure already created should receive immediate attention. 9.26.6 To estimate the manpower requirements for maintenance, pilots and others, the Ministry of Civil Aviation would conduct a manpower planning study. 9.26.7 Among the different modes of transport, civil aviation is closely linked with the development of tourism, as the vast majority of tourists coming to India, arrive and depart by air. Capacity constraints are often felt on air travel to and from India particularly during the peak tourist season. Tourist charters would be encouraged. 9.26.8 Airborne trade has been increasing in importance and now accounts for more than a quarter of total foreign trade in value terms. Stress will be given on upgrading airport infrastructure in terms of increased storage space, better handling capacities and augmentation of upliftment capacity for carriage of more cargo. TOURISM General 9.27.1 Over the years, tourism has emerged as a major segment of Indian economy contributing substantially to the foreign exchange earnings which have increased from Rs.32 crores in 1974-75 to more than Rs.3000 crores in 1991-92. Since imports of goods needed for tourism are limited, value added component in term of foreign exchange earning of this industry in relatively high. Domestic tourism, too, plays an important role in the integration of people, employment generation and economic development of the country. 9.27.2 The Seventh Plan was a water-shed in the development of tourism in the country. For the first time, the vast potential of tourism as a foreign exchange earner and as a generator of employment opportunities was recognised. Several new policy initiatives were taken to develop the tourism sector on an accelerated growth path. Tourism was accorded the status of an industry. At present, 15 States and 3 Union Territories have declared tourism as an industry. In addition, 4 States have declared hotels as an industry. Consequently, a number of incentives have been made available to private entrepreneurs for investment in tourism acitivi-ties. 9.27.3 The Government set up the Tourism Finance Corporation in 1989 to provide financial assistance for setting up or for development of tourist related activities and services which include interalia hotels, restaurants, amusement parks, resorts and complexes for entertainment, education and sports. The marketing activities of private entrepreneurs and other agencies were given additional support through the scheme of "Assistance for the Development of International Tourism (ADIT)". Review of Tourism Sector 9.28.1 There has been a gradual increase in Plan outlay for tourism over the Plan periods from Rs.1.58 crores in the Second Plan to Rs.138.68 crores in the Seventh Plan. 9.28.2 The foreign tourist arrivals in India increased from about 17,000 in 1951 to 1.71 million in 1990. However, our share in the total world arrivals has ranged between 0.28% and 0.32% in the last 10 years. It is anticipated that tourist traffic will grow at the rate of 9% to 10% per annum and about 2.75 million tourist arrivals are anticipated by the end of the Eighth Plan. 9.28.3 The number of approved star hotels in India has gone up from 186 in 1963 to 650 in 1990 with 40,000 rooms. Future Perspective and Eighth Plan Thrust 9.29.1 In the development of tourism, the,pub-lic sector has made significant contributiortdur-ing the last three decades. The industry is tdday equipped with a reasonable infrastructural base and is poised for a self-sustained growth. The future growth of tourism should, therefore, be achieved mainly through private initiative. The State can contribute to tourism by planning broad strategies of development, provision of fiscal and monetary incentives to catalyse private sector investments and devising effective regulatory and supervisory mechanisms to protect the interest of the industry, the consumer and the environment. 9.29.2 The strategy for the development of the tourism sector should be based on the principle of low-cost economy, higher levels of productivity, efficiency in use of infrastructure and provision of clean and economic tourist facilities for middle class tourists, both domestic and foreign. India, being'a multi-destination country of continental dimensions, has induced tourism promoters to adopt a "spread approach". It is necessary, in view of the scarce capital, that a selective approach should be adopted for development of tourism. 9.29.3 In the Eighth Plan, the "Special Tourism Areas" concept is being adopted, wherein a few tourist areas with high tourism potential will be identified and provided with full fledged infra-structural facilities. 9.29.4 A package of financial and monetary assistance has been conceived to provide impetus to tourism investment. These include " Tourism Development Fund" to provide financial assistance for tourism activities in Special Tourism Areas and the "Equity Scheme" under which the Central Department of Tourism and the State Government would contribute to the equity capital of tourism ventures. 9.29.5 Tourism marketing and publicity need strengthening. Our marketing strategy has to be made more dynamic in terms of spread, innovation, imagination, new techniques and coordination. A well coordinated publicity drive of all the organisations connected with tourism could yield greater benefits. 9.29.6 The proportion of high spenders among foreign tourists has gone down in recent years and that of low budget visitors has risen. This trend needs to be reversed and effective measures should be taken to maximise the earnings, while increasing the flow of tourists into the country. The focus and promotional strategy during the Eighth Plan should be on high spending tourists from areas like Europe, USA and Japan. 9.29.7 The absence of an uptodate information system with quick retrieval facilities leads to poor tourist facilitation. The technological developments in the field of communication and computers, should, therefore, be profitably utilised for establishing a tourist information network. 9.29.8 There is also a perceptible lack of hygienic and inexpensive accomodation to cater to the need of low spending tourists needs. While State should focus its efforts towards promotion of supplementary accomodation like private guest houses, tourist bungalows, paying guest accomodation, forest lodges etc., investment in three to five star hotels should be restricted to the private sector. Private sector investment needs to be attracted through fiscal and monetary incentives to ease the borrowing and repayment of credit, allotment of suitable sites at concessional rates and other concessions etc. 9.29.9 Anti-poverty and area development programmes for backward areas should be integrated with tourism development programmes. This will provide the local people with employment opportunities and supplementary income. 9.29.10 Indequate airline capacity is a critical bottleneck in air travel to and from India, particularly during the peak tourist season. Charters not only augment air capacity but also help in promoting new destinations. Adequate attention needs to be paid for upgrading road transportation facilities in important tourist centres. Private sector could be encouraged to invest in developing tourist transport by giving relief in excise duties when indigenous vehicles are purchased for tourism purposes. 9.29.11 Rail transportation has a special fascination for foreign tourists as demonstrated by the successful rail tourism projects like the "Palace on Wheels". The "Great Indian Temples" in Southern India should also be introduced. The possibility of having ship cruises along the coastline and the potential offered by the back waters of Kerala and Sunderbans in West Bengal for river cruises would be fully tapped. 9.29.12 Adequate attention has to be paid to enlist private sector participation in the development of special interest tourism like beach and wild-life tourism, amusement parks, conventions and conferences. 9.29.13 Balanced infrastructural development and preservation of rich cultural heritage is of critical importance. To achieve this objective, it is necessary to formulate master plans for all States highlighting the tourism potential in the State. Such an approach would ensure that economic activities in these States are so planned that they facilitate tourism development, ensure consistency and avoid overlap. An integrated development plan for the heritage centres, with focus on forts, palaces and old havelis with due concern for town planning needs to be introduced. 9.29.14 Human Resources Development is of vital importance in a service industry like tourism. The quality of training programmes and that of teaching faculty should be improved with focus on history and culture. The capacity in terms of the intake of apprentices and the number of institutions both at the craft and diploma levels should be increased. Universities should be encouraged to introduce tourism oriented courses. Short duration programmes for updating the knowledge and skills of those employed at the grassroot and supervisory levels, and career counselling aimed at developing entrepre-neurship need to be organised. Eighth Plan Programme 9.30.1 The Central Sector Tourism Plan encompasses : (i) Department of Tourism (ii) India" Tourism Development Corporation (iii) Manpower and Institutional Development. Department of Tourism (DOT) 9.30.2 The Department of Tourism will carry out effective publicity promotion, and provide infrastructural support and facilities for new forms of tourism like holiday and leisure tourism, wildlife etc. The DOT will, for the most part, play a "promotional" role in the development of tourism. The Eighth Plan visualises identification and development of "Special Tourism Areas" with high tourism potential. The ongoing projects of "Buddhist Places of Interest in Bihar" and "Development of Ajanta Ellora in Maharashtra" were taken up with external financial assistance. A number of new projects would be posed for external assistance including "Agra Heritage Project", "Buddhist Places of Interest in Uttar Pradesh and Bihar". Table
9.23 Outlay and Expenditure - Tourism
Note : Figures in brackets indicates budgetary support. India Tourism Development Corporation (ITDC) 9.30.3 The ITDC came into existence in 1966 with the basic objective of providing tourism infrastructure for overall development of tourism in the country. The Corporation has 31 hotels/traveller lodges with 3762 rooms. The financial performance of the Corporation has been satisfactory. The turnover increased from Rs.72.11 crores in 1985-86 to Rs. 121.92 crores in 1990-91. 9.30.4 The main emphasis in the Eighth Plan for the ITDC would be on consolidation rather than on expansion of accomodation. Sustained efforts will be made to improve the profitability of its existing hotels through different measures including collaboration with well-known international hotel chains. Manpower and Institutional Development 9.30.5 At present, there are 14 Institutes of Hotel Management and Food Craft Institutes. A master plan is under preparation for development of manpower for the tourism industry on an integrated basis. In the field of manpower and training, the major scheme relates to setting up of a "Culinary Institute of India" with foreign technical expertise. 9.30.6 The outlay approved for Eighth Plan is Rs. 272 crores in the Central sector. In the States sector, an outlay of Rs. 501.62 crores has been provided for Tourism in the Eighth Plan. Annexure
- 9.1
Note :- Figures in brackets indicate percentage to the total plan expenditure $ During the first four Plans the expenditure from the depreciation reserve fund wasnot included in the plan expenditure. ** Includes provision for continuing corrective works on Bhagirathi Hoogly Rivers, Farakka Barrage, States' Share in the railway projects, urban transport road safety, etc. Scheme-wise allocation to be finalised in the Annual Plans. Annexure
- 9.2
Annexure - 9.3 Railways
: Financing of Plans - Approved and Actual Outlays
Annexure 9.4 Railways
- Major Plan Headwise Investment
Annexure -9.5 Railways:
Fleet Awaiting Repairs - Targetted and Actuals
* It is considered that another 2.5 % or so are not fully reported or freely loadable. They earn very little in terms of revenue NTKMs. Annexure - 9.6 Railways
: Composition of Originating Freight Traffic
Figures in brackets indicate percentage of Grand Total. Annexure - 9.7 Seventh
Plan Outlay and Expenditure in Ports Sector
Annexure - 9.8 Outlay
and Expenditure in Seventh Plan, Annual Plans - Civil Aviation
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