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“AAI has the capacity to mobilize funds to set up airports”

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RK SRIVASTAVA took over as chairman of the Airports Authority of India early this year. The 1984 IAS batch officer from the Jharkhand cadre talks to Managing Editor RAMESH MENON about the challenges he faces and the road ahead. Excerpts:


What were the major challenges you encountered when you
took over?
AAI is a large organization with a pan-India presence. Being a public sector undertaking, it is constrained with the rigid framework of government policies that need to catch up with ever-changing global trends and practices. We want to bust the myth that the public sector is inefficient. As we facilitate air transport, we have been facing several challenges. We met them by creating infrastructure in Tier-II and III cities, improving operational efficiency of the terminals, providing better amenities to passengers, strengthening the safety measures and building a capable workforce. We have adopted multi-pronged strategies, enhanced internal capacity and employed external resources.

When did the government realize that airport modernization should be a priority?
After the opening up of the Indian economy, a phenomenal surge in GDP growth was accompanied by an unprecedented surge in air traffic. Since 2003-04, the government decided to modernize airports and drew a road map for the construction of new terminals as well as expanding and strengthening the existing ones along with the related infrastructure.

In the next 10 years, how many airports will India need? Are we doing anything to achieve this goal?
Going by the statistics, India has about 464 airports and airstrips, out of which AAI manages 125 airports. About 76 airports have scheduled flight operations. Most of the state capitals and big cities have got an airport, except Arunachal Pradesh. Over the last five years, the cumulative Compound Annual Growth Rate (CAGR) has been around nine percent, resulting in impressive growth in air traffic. In the last six months, traffic growth over the previous years has been 18 percent. There has been a substantial increase in the movement of aircraft and cargo as well. Going by the thumb rule, the rate of increase of air traffic is 150 percent of the GDP growth rate.

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Swanky interiors of the Kolkata Airport

As the economy grows further, passenger growth will saturate existing infrastructure unless expansion of the airports is undertaken to match the growing demand. The present traffic is around 190 million against the capacity of 250 million passengers created over the last few years.

AAI, therefore, envisages making all its airports operational and further enhance the capacity of its terminals. We are also actively engaging with state governments to develop new Greenfield airports. We are working towards making a paradigm shift in our strategy to develop new airports through Special Purpose Vehicles (SPVs), in which the state governments’ PSUs and the people at large are stakeholders. This will go a long way in improving regional connectivity and in developing airports in remote areas by activating currently unused airports.

What role do airports play in helping the local economy? Will the concept of an Aerocity take off in India?
The development of airports in any area has a direct bearing in boosting the local economy. At the construction stage, for an investment of around a crore of rupees, employment of approximately 17,000 man days is created. At the operational stage, employment is generated for a thousand people if an airport handles a million passengers.

AAI has already taken up development of 26 airports like Agatti, Akola, Leh, Pantnagar, Vijayawada, Tezu, Kishangarh and Hubli. Fourteen airports have been completed, six are in progress and another six are in the planning stage. The government has also given the green signal for the development of 14 new Greenfield airports, of which Pakyong near Gangtok in Sikkim is being developed by AAI.

The concept of an Aerocity in India is now catching up. In fact, if you see the AAI Act, it is more development- and operation-centric. The development of transport infrastructure in India has always been seen as a welfare measure. Giving a commercial dimension to such development for realizing the CAPEX (capital expenditure) and OPEX (operational expenditure) is now increasingly being recognized. You may witness this in the development of highways, where realization of capital expenditure through toll tax is emphasized. The concept of an Aerocity has been introduced for the first time in Delhi. In Durgapur and Chandigarh, large chunks of land have been acquired on the outskirts of airports for the development of aerocities, with the airports becoming the nucleus for growth. AAI has already taken up feasibility studies of Lucknow, Raipur and Tirupati airports.

The PM is talking of Digital India. What kind of e-systems do you see in airports in the next five years?
In today’s world, airports across the world are digitally connected and that is how the journey from one part of the globe to another has increasingly become seamless. The interface with airport operators and airlines with passengers is increasingly getting reduced due to technology. AAI is going to introduce automated self-check-ins and baggage drops. It has also set up Airport Operations Control Centers (AOCCs) at 10 places for collaborative decision-making.

Do you think you are adequately staffed to handle the load
across airports?
For most of the activities at airports, we need highly technical and skilled staff. With the introduction of new technology in operations and navigations, the requirements and qualifications of the staff have undergone changes. With an increase in traffic volume, work regarding management of Air Navigation Services has increased. We have been doing the exercise on a continuous basis to meet such requirements. In the near future, AAI will be adequately staffed.

What are some of the safety and security features that you are contemplating at airports?
AAI is focused on making air navigation safe for air travel. We have been continuously upgrading safety measures by introducing latest equipments and procedures. Similarly, the focus has been on strengthening the security features at the airports by equipping security personnel with new gadgets and comprehensive training. All the standards and features determined by the Bureau of Civil Aviation Security (BCAS) are met at every airport.

Do you see airports as a sunrise industry in India? What are the possibilities of small private and corporate aircrafts plying?
Air transport is a sunrise industry with increasing volume of GDP and expanding reach. There is a demand for development of new airports in every nook and corner of the country. With the new Civil Aviation Policy, new vistas regarding inter-state and intra-state air connectivity and growth in the private and corporate aircraft sector are likely to open. It is likely to boost commercial operations in small places and places of tourist importance. Certainly, the demand for smaller private and corporate aircrafts will increase.

AAI has sought branding in Delhi and Mumbai airports. What has happened to it? Are the private airport operators there like GMR and GVK respectively ready to share the limelight with AAI?
AAI does have a brand of its own. GVK and GMR are partners in the SPVs created for development and operation of the airports at the political and commercial capitals of India. This experiment of managing two airports with private partners has been a success story. The development and management of infrastructure, particularly in the transport sector, have been evolving in India and has taken on a new commercial dimension.

Aviation, however, is the only sector where direct investment from the consolidated fund of India has been minimal. AAI, over a period of time, has established itself as a financially viable proposition. I expect that AAI, with its own standing, can mobilize enough funds from its internal resources and from the market to set up airport infrastructure. With the capacity development of people involved in the operation, we can meet the challenges of running airports efficiently as well.

Was it a good idea to privatize certain airports considering that it has proved costly for fliers with all kinds of charges thrown in?
Privatization of airports was taken up in the middle of the last decade at a time when air traffic in India witnessed an unprecedented growth following the entry of low-cost carriers. Traffic growth necessitated the sudden expansion and modernization of airports.

At that time, two serious issues emerged—availability of funds and capacity to build infrastructure. That necessitated modernization and expansion of Delhi and Mumbai airports through the SPV route. The investment required to modernize these airports led to an increase in airport charges in the initial control period. However, it is expected to come down in the subsequent control periods.

Many of AAI’s skilled employees have joined private airport operators like GMR and GVK. Isn’t this a loss for AAI?
In today’s world, migration of skilled employees from one organization to another is the order of day and we should learn to live with that.

What are the international MoUs that AAI has signed?
AAI has signed several MoUs with IATA for “Skill Development in Airport Management as per Global Standards” & “ATC E&F Agreement”, with ACI-ICAO for the “Aviation Management Professional Accreditation Program”.

AAI’s has some special plans for PM Narendra Modi’s constituency, Varanasi. What are they?
Varanasi is a very important international tourist destination, being a spiritual capital and a holy destination for Buddhists. AAI proposes to construct a new ATC tower and extend the runway for Code ‘D’ (B-767) type of aircrafts. We have approached the state government to provide about 593 acres of land to provide ILS and Cat III B landing facilities.
We also propose to extend the runway and expand the apron. Further, we plan to undertake city-side development in order to provide hotels, restaurants and set up aviation-related activities.

What about technological upgradation matching international
standards?
AAI has been very pro-active in introducing the latest technology in its operation and navigation services. For CNS and ATM (Communications, Navigation, Surveillance and Air Traffic Management), new equipment with the latest technology have been brought in. We have embarked upon Air Traffic Flow Management.
We have executed the coveted project of GPS aided Geo Augmented Navigation (GAGAN) system, which has been operationalized after due certification from the DGCA. This has catapulted India amongst the first four countries in the world to have adopted satellite-based navigation. The newly introduced ADS-B technology provides improved surveillance of the entire
airspace.

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