Parliament proceedings | ‘Crests and troughs’ in aviation sector: Scindia

Union Civil Aviation Minister Jyotiraditya Scindia on Monday told the Rajya Sabha that the industry has “crests and troughs” and air ticket pricing depends on seasons but passengers can benefit from booking in advance.

The Minister also said that Amritsar and Chandigarh together have 42 air traffic movements internationally, including 33 in Amritsar and nine in Chandigarh, and expressed confidence that whenever Indian carriers will expand, Punjab will be a very key element of that.

Replying to supplementaries, the Minister said the civil aviation sector is a deregulated sector and the government does not have control over route expansions as it depends on airlines.

On high ticket pricing especially during the festive season, the minister said it is extremely important to understand that the civil aviation sector is a seasonal industry.

“There are crests and there are troughs. When festive season starts in October all the way up to February is the high season of civil aviation and you then get into a little bit of a medium lull situation and then the trough, which is the monsoon season is really a wipe out season in terms of civil aviation…Because of seasonality factors there will be pricing differences,” the Minister told the House during Question Hour.

He said one also has to understand that the sector has gone through possibly the worst time for any industry in the world during the COVID-19 pandemic.

“It was the only industry where our planes were on the tarmac for almost 18 to 24 months and the very fact that we have experienced a V-shaped recovery speaks great volumes of the resoluteness of our carriers and the capability to supply that service to the common man,” the Minister said.

The Air Turbine fuel (ATF), which is a very important ingredient as a raw material and almost close to about 50 percent of the carrier’s cost structure, has gone up from from pre-Covid between ₹35,000 to ₹40,000 a Kilolitre to today’s level of Rs 1,17,000 a kilolitre, he noted.

“There has been an almost 2.5 times jump in terms of the main raw material cost in the cost structure, which comprises almost 50 percent. That too has an effect on fares.

“The civil aviation sector functions on what is called the Reservation Booking Designator (RBD), where if you book very far in advance you will get very low fares and as the plane gets filling up the fare is certain to go up and that is an international practice that is followed all across the globe,” the minister informed members.

He also hit out at previous governments for being liberal in terms of signing air traffic agreements and giving multiple points of call to neighbours.

“India has to look after her own interests. In the past, governments have been way too liberal in terms of signing air service agreements and giving multiple points of call to our neighbours very close to our geography,” he said, rejecting insinuations made by some members that there is no international air connectivity with Amritsar and Chandigarh.

“We have international connectivity from Amritsar and Chandigarh to almost seven countries – United Kingdom, Qatar, Dubai, Malaysia, Sharjah, Singapore and Italy. As far as Amritsar is concerned, we have 17 air traffic movements per week internationally, specifically to Singapore, Doha, Kuala Lumpur, as well as to Tibilsi and Milan Malpensa.

“As far as domestic carriers are concerns, we have 42 air traffic movements internationally in Amritsar and Chandigarh together – 33 in Amritsar and nine in Chandigarh, connected to London, Birmingham, Dubai, Sharjah, Rome and even Bergamo. This is the length and breadth of wide connectivity,” he told the House.

Mr. Scindia said in air service traffic agreements, “we only give connectivity to six metros in India because in response we hardly get one or two calls in those countries”.

“So certainly we cannot open up our country to them. We must also strengthen our Indian carriers. The concept of Atmanirbhar Bharat. I am very pleased to report to this House that now our Indian carriers are getting wide-bodied aircraft, we are going to go long haul, we are going to put our Indian flag across the world in terms of direct connectivity,” he said.

The Minister also expressed confidence that Indian carriers will be able to provide that service and certainly Punjab will be a very key element of that.

He noted that Amritsar and Chandigarh both have tremendous connectivity across India.

Asked whether Guwahati will be connected to international destinations, he said, “The civil aviation sector is a deregulated sector and the decisions are made by airlines based on possibilities of passenger load factor as well as economic issues.” In his written reply, the minister said, “National Civil Aviation Policy 2016, inter alia provides for open sky Air Service Agreement on reciprocal basis with countries with territory located beyond a 5,000 km radius from New Delhi. Canada agreed to India’s proposal for unlimited direct connectivity as per open sky arrangement. It provides unlimited direct connectivity by Canadian Airlines to six Indian airports (Delhi, Mumbai, Chennai, Hyderabad, Bengaluru and Kolkata).”

“Reciprocally, Indian airlines are allowed unlimited direct connectivity from any point in India (including Amritsar and Chandigarh) to six airports in Canada viz. Toronto, Montreal, Edmonton, Vancouver, and two points to be selected by India,” he said.

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