Civil aviation: govt must clear it for take off

The unambiguous election mandate to Narendra Modi could be seen as validation of the direction he took during his first term in office, and a mandate for the next five years to gather velocity and bring unfinished agendas to consummation. Indian civil aviation, whose distress is implicit in one airline that has no buyers, another that has been grounded, and a cut-throat airfare war, with the cost of operation well above the revenue from sale of tickets. Decidedly, the achievements in civil aviation during the last five years have been unremarkable, while the potential for attainable, laudable objectives in the next five years is substantial.

All the noises being made about reforms and progress would thus indicate a need to start early. The beginning, however, has been a bit dismaying. Hardeep Puri, the new Civil Aviation Minister, is a former bureaucrat (the civil aviation community would have preferred to have a professional airman!), but he is also Minister of State (Independent Charge) of the Ministry of Housing and Urban Affairs, and Minister of State in the Ministry of Commerce and Industry. How much of his time would he be able to devote to grasping and then cracking the challenges that boggle civil aviation is a matter of conjecture. Possibly, the other two jobs will leave him about a third of his time to civil aviation affairs.

Then, there is the matter of Arun Kumar, another IAS generalist, being given the additional charge of Director General of Civil Aviation (DGCA) after the previous incumbent finished his tenure on May 31. The DGCA’s job is in addition to his post as an additional secretary in the Ministry of Civil Aviation (MoCA) and thus would have the benefit of his divided attention only.

Inarguably, the top-most inadequacy that afflicts our aviation industry is infrastructure. Catchphrases like ‘hawai chappal to hawai jahaz’ have caught people’s fancy, but in reality, achievements predicated on Udey Desh Ka Aam Nagarik (UDAN) have been non-descript — the majority of the routes bid for and allocated for regional connectivity have not even debuted. Perhaps, this has been due to the fact that UDAN and the Scheduled Commuter Airline (SCA) schemes have been regulation driven. It may be a good idea to let market forces drive the demand on regional and remote routes. However, that brings us back to the issue of infrastructure. Only by rejuvenating more and more of the Tier II/ Tier III airports and making them available with all facilities to commercial flights can UDAN really take off.

On the regulatory front, the DGCA, despite the good intentions of its individual components, has been shackled by manpower shortage, lack of autonomy, paltry financial authority and a culture of favouring the stick rather than the carrot when dealing with its regulatee organisations and operators. As a result, its regulatory endeavours fall short of making it a facilitator, which it asserts it is.

Ideally, a Civil Aviation Authority (CAA), like the UK CAA, needs to be enacted through the CAA Act which has been presented and debated in Parliament as a Bill in the past but has not become an Act. Alternatively, the DGCA needs to be empowered to make its own financial decisions and have punitive powers to help it ‘regulate’ more effectively.

Aviation fuel

Rationalisation of aviation fuel cost is a long-standing issue. Aircraft operators have, since 2003 (when the new wave of liberalisation helped launch Air Deccan), clamoured incessantly for reducing the hefty duties and taxes on aviation fuel (which accounts for around half of the aircraft operating costs). The relentless refrain to place aviation fuel under the declared goods category for the purpose of Sales Tax/VAT mutated to a demand to place it under a reasonably low GST slab.

Consecutive governments have used as alibi their inability to convince or prevail upon state governments to acquiesce to a lower tax regime for aviation fuel as it is a state subject. But with the BJP holding sway over more than half the states and considerable political clout in most others, it is time for the government to use the reforms watchword to push all states to accept a reasonable and uniform tax regime for aviation fuel. This single reform will provide a momentous impetus to civil aviation in India.

Similarly, the maintenance, repair and overhaul (MRO) industry is ambling along at a subsistence level, waiting for the government to infuse it with life through a rationalised tax and duty structure so that it can start thinking of developing India into an international hub.

The disinvestment of Air India and the privatisation of Pawan Hans are absolutely inescapable so that their internal inefficiencies can be replaced with professionally competent managements and the taxpayer saved from his enforced contribution to their undeserved survival. Commercial drone activity eagerly awaits the consummation of ‘Digital Sky’ to facilitate drone proliferation. A decision on the withdrawal of Boeing 737MAX grounding needs deliberation over the next few weeks. The greening of aviation would have to be looked at by the government with a fresh approach, lest India be left at a disadvantage in the ongoing international initiatives on aviation emissions and their curtailment.

The ministry’s hands are going to be spilling over with the above ‘to do’ list and some other less important objectives. One hopes that the triple role of its minister and the dual role of the head of the DGCA are temporary and both chairs get incumbents who can dedicate their time and energy to the much-needed deliverance of Indian civil aviation.

(The writer is a former Chief Operations Officer of an airline)