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Published on : Friday, June 24, 2016
Airports Council International (ACI) welcomed the India’s National Civil Aviation Policy as a significant step forward in assuring that the country takes its rightful place in aviation as a driver of economic and social development. As an example, the proposed introduction of the hybrid till system will result in increased private investment in airports and enable the airport sector to play its role in facilitating growth in air travel.
“ACI welcomes the National Civil Aviation Plan recently introduced by the Indian Ministry of Civil Aviation,” said Angela Gittens, Director General, ACI World. “It provides a fundamental regulatory framework to improve connectivity, productivity and efficiency in the movement of passengers and goods by providing access to safe, secure and affordable air services and world-class airport facilities.”
In particular, ACI’s stance is that the introduction of the hybrid till model to all airports in India will result in increased private investment in airports and lay the groundwork to ensure that the country’s airports are well positioned to manage strong forecasted growth in air travel. India is a market with huge potential for air traffic growth. Over the last five years, passenger traffic in the country has grown by 8.6% on average, well above the worldwide average of 5.2% for the same period. Preliminary ACI forecasts suggest that total passenger traffic in India will reach 320 million by 2020, up from 212 million last year. In fact, we are likely to see a doubling of 2020 passenger traffic by 2030, which would place India as one of the largest air transport markets in the world after China and the United States. Thus, ensuring that airports are well positioned to handle this growth is imperative, and public-private partnerships have proven to be an effective way of providing airports with the funds they need to build new infrastructure and introduce new efficiencies with the aim of continued sustainable growth. In order to attract investment, though, the right regulatory framework needs to be in place.
“There are innumerable examples of governments all over the world which realize that a partnership between private and public players can trigger investment in airports when suitable regulation is in place, including the provision of a dual till or a hybrid till system,” adds Stefano Baronci, Director of Economics, ACI World. “In fact, considering the top 100 busiest airports in the world, half operate either under a dual till or a hybrid till system. While the airports under these till regimes are found all over the globe, there is a higher prevalence in Asia-Pacific, Europe and Latin America-Caribbean. These markets also have a higher propensity for private sector participation.
“Over and above attracting investment, a dual till or a balanced hybrid approach creates incentives for airports to develop their commercial activities independently of their aeronautical activities, with the former being a vital resource to drive the much needed modernization of airport infrastructure and the improvement of the quality of service to the passengers,” adds Baronci. “It is not by chance that in the last few years some Indian airports have been able to achieve best in class air service quality.”
“Infrastructure development is a mission that emerging and fast growing markets such as India cannot simply ignore if they plan to be a leading economic power worldwide,” concluded Director General Gittens. “The decision to apply a hybrid till model to all airports in India is a welcome step toward regulatory certainty. Moreover, its uniform application to all airports in the country ensures that due consideration is given to all aviation stakeholders, and to the needs of passengers. With airports now being sophisticated businesses in their own right, sufficient levels of investment and charges are essential prerequisites if they are to continue to deliver increased capacity, quality and connectivity. ACI is pleased that the Indian Ministry of Civil Aviation is taking the necessary steps to ensure sustainable growth of air transport.”