The biggest-ever deal of Rs.26,000 crore ($4.4 billion) at an Indian air show was signed between Boeing and SpiceJet as the India Aviation-2014 got off to a flying start here on Wednesday.
The MoU was inked between the two companies in the presence of Civil Aviation Minister Ajit Singh during the inaugural session of the five-day India Aviation-2014 show with SpiceJet placing the order for 42 Next Generation 737 MAX 8 aircraft with Boeing.
Dinesh Keskar, Senior Vice-President of Asia-Pacific and India Sales, Boeing, told reporters that the delivery of the aircraft would begin from 2018. He said 737 MAX was 14 per cent more fuel-efficient and the plane, a variant of the 737-800, came with a new engine and bigger wings. He said the first aircraft would be handed over to South West Airlines in 2017.
S. L. Narayanan, Group Chief Financial Officer, The Sun Group, said the induction of 737 MAX would further modernise the airline’s fleet, improve customer experience and ensure that it operated the most efficient fleet well into the future.
Inaugurating the event, Mr. Ajit Singh said allowing 49 per cent foreign direct investment (FDI) into Indian airlines was the biggest game-changer. “This is in addition to the FDI of $350 million by Etihad into Jet Airways,” he said. Mr. Singh said the Regional and Remote Area Air Connectivity Policy offered several concessions to operators connecting regional and remote area airports.
Besides, work on more than 50 low-cost airports, located in remote and interior areas had already been initiated by the Airports Authority of India (AAI). He announced that a civil aviation university was being set up to enhance capacity to produce world-class skilled manpower.
Andhra Pradesh Governor E. S. L. Narasimhan, who was the chief guest, said India’s first Aerospace SEZ, on the outskirts of Hyderabad, would offer a wide range of products to meet the needs of aerospace, nuclear, space and defence sectors. He said the State government was planning to set up a Civil Aviation Board to oversee development of new airports in Tier-II cities.
Secretary, Civil Aviation, Ashok Lavasa, said India made tremendous strides in aviation as passenger and cargo throughput registered an impressive CAGR (compounded annual growth rate) of 13 per cent and 10 per cent, respectively during 2003-13. The overall air traffic was expected to grow at 10.1 per cent this decade. He said that in addition to greenfield airports at Navi Mumbai, Goa, Kannur and Kushainagar, the AAI had identified six airports under the PPP (public private partnership) route.