Industry

Torpid airports may convert into SEZs

Foreign-controlled airlines in India may not be allowed to fly on international routes. File photo.

Foreign-controlled airlines in India may not be allowed to fly on international routes. File photo.   | Photo Credit: Handout_E_Mail

Leasing firms can park their aircraft at such facilities

The Centre is mulling a plan to convert unused airports in India into special economic zones (SEZ) for aircraft leasing companies to park their aircraft and showcase them to potential customers, Civil Aviation Secretary R. N. Choubey said.

“I met someone who said we have so many airports in the country. Is it possible for us to declare some of them as SEZs and allow the airports to be used for two things. One is for leasing companies all over the world to come and park their aircraft here,” Mr. Choubey said at an event organised by Assocham.

Reduce costs

“Leasing companies can park 50-100 aircraft. The companies can then come, take test flights and place orders,” Mr. Choubey explained later, adding that the ministry would pursue the proposal. He said an AAI airport lying unused in Hyderabad can be utilised for the purpose.

Like ship-breaking, he said, even dismantling an aircraft could be made possible at dormant airports. “The moment you allow leasing and aircraft breaking to happen at abandoned airports, MROs (maintenance, repair and overhaul) will automatically come,” the secretary said.

He also said that the government was exploring ways to reduce the cost of leasing aircraft without which “regional connectivity (scheme) may find difficulty in taking off.”

Foreign airlines

Foreign-controlled airlines in India may not be allowed to fly on international routes, Mr. Choubey said. “ICAO (International Civil Aviation Organisation) rules are to be complied with by all the countries. So, we would like to examine how other countries allowing their domestic airlines to fly abroad where foreign ownership is more than 50 per cent,” he said. However, the government would dilute the substantial ownership and effective control norms to allow foreign players to control and run domestic airlines in India.

Recently, the government allowed foreign investors to own up to 100 per cent stake in domestic carriers. However, the new FDI norm allows a foreign carrier to invest only up to 49 per cent to set up an airline in India. The rest can come from either local or foreign investors.

India’s domestic air travel rose 22.9 per cent in January compared with the same period a year ago, according to International Air Transport Association.

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Printable version | Feb 25, 2020 2:52:33 AM | https://www.thehindu.com/business/Industry/Torpid-airports-may-convert-into-SEZs/article14397186.ece

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