Industry

Ground handling firms mull legal battle over aviation rules

State-of-the-art ground handling equipment for transporting passengers and cargo. The new fleet of modern vehicles and other sophisticated equipment that were inducted at the Chennai Airport. Photo: A.Muralitharan   | Photo Credit: A_Muralitharan

The Ground Handlers’ Association of India (GHAI)is planning to drag the government to court over the policy uncertainties plaguing the sector for the past nine years.

GHAI, which represents eight domestic ground handling firms, claimed that these inconsistencies had affected businesses. “We are contemplating moving the court on the policy looking at the inconsistencies prevailing in ground-handling in the last nine years. We are ready for a bitter battle now,” GHAI Secretary-General Arvind Kumar told The Hindu in an interview.

Ground-handling services are an important part of an airline's operations. They include aircraft cleaning and servicing, loading and unloading of food and beverages, besides cargo and luggage handling at the airports. Airlines prefer self-handling to reduce the cost of operations and for better efficiency. While older domestic airlines prefer self-handling at most airports, GHAI takes care of ground-handling for foreign carriers.

The association also flagged safety concerns on the government’s proposal to allow airlines to handle their own services at airports — known as self-handling — under the proposed civil aviation policy. Allowing contract workers in airport operations of airlines would lead to safety hazards, it cautioned.

The draft civil aviation policy, released in October 2015, proposes self-handling at airports — a long-pending demand of all domestic airlines which too have moved the Supreme Court in the past.

According to the proposal, there will be at least three ground-handling agencies at any airport, with no upper limits, and airlines will be allowed to do self-handling.

It also proposes to allow charter operators to self-handle at all airports. The airlines and ground-handlers have been permitted to hire contract labourers.

“Our biggest concern is the unlimited entry of ground-handlers into the airport and third-party handling of airlines with the help of contract labour,” Mr. Kumar said.

“As for us, all our employees are on rolls. We have around 18,000 permanent staff. There should be firewalls in place. Private airlines shouldn’t be allowed to handle all the operations at airports,” he added.

He claimed that the civil aviation ministry wanted to open up the ground-handling sector to build competition.

“While ours is an oligopoly market (dominated by few firms with entry barriers), the government is treating as a perfect competition industry,” he said. “With investments as high as Rs.7 crore on each equipment, it cannot be a perfect competition. Such high investment requires scale.”

However, the domestic airline claim third-party ground handlers are a safety threat.

“Ground handling being an integral and inseparable part of the business of running an airline, cannot be left to the whims and fancies of a third-party handler who does not empathise with the airline or its passengers,” Federation of Indian Airlines (FIA) associate director Ujjwal Dey said.

Third party ground-handlers especially with foreign ownership of unknown origin are themselves a serious security risk, according to Dey. FIA represents IndiGo, Jet Airways, SpiceJet and GoAir. Airlines hire contract workers to reduce the cost of operations. According to Mr. Kumar, ground-handling accounts for 1.5 per cent of airfares. “You can’t allow the industry to go sick by cutting costs and compromising on quality, safety and security,” he said. The GHAI membershad have spent around Rs.2,000 crore on buying equipment purchase and brought in foreign direct investment of Rs.1,000 crore, Mr. Kumar said.


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Printable version | Oct 18, 2021 10:08:47 PM | https://www.thehindu.com/business/Industry/ground-handling-firms-mull-legal-battle-over-aviation-rules/article8472277.ece

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