Andhra Pradesh

Vijayawada-Singapore flight service hangs in balance

The city’s first international flight service being operated to Singapore appears to be hanging in a balance as the new government is yet to take a decision on renewal of the agreement its predecessor made with private airline Indigo.

The previous government through Andhra Pradesh Airports Development Corporation Limited (APADCL) has hired leading domestic carrier Indigo and began the bi-weekly service on December 4 last year as a last resort due to inordinate delay in issuance of route permissions for foreign airline by the Central government agencies.

The agreement which was made for six months initially has lapsed recently and the formal approval of the government for renewal of it is awaited. Currently, advance bookings for the service are open.

Considering the average passenger load factor which was only about 50% the new government may likely choose to suspend the agreement to shed the burden of paying crores of rupees every month to the operator towards Viability Gap Funding as per the agreement.

Hopes alive

However, both APADCL and Indigo are hopeful that the agreement would be renewed as it needs at least six months to one year to judge the financial viability of any international route.

“In all probability, we will continue to operate the services. We have sent proposals for the renewal of the agreement to the government which agreed to it in principle. Even Indigo has agreed to continue. However, formal approval is yet to be given,” APADCL chief executive officer Virender Singh told The Hindu.

“The performance might not be as expected yet but it takes at least six months to one year for international routes to pick up patronage. In addition to renewal, we have also proposed increasing frequency from bi-weekly to tri-weekly to increase the occupancy ratio. Having a service on alternate days does better than having just two flights a week,” he added.

Occupancy ratio

According to Mr. Singh, the occupancy ratio or load factor so far was around 50% on average while the government is paying VGA to the tune of 35 to 40% on average.

During the first five months, as many as 6,294 passengers used the Vijayawada-Singapore services and 69 flights were operated between the destinations offering 180 seats per flight, according to Airports Authority of India data.

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Printable version | Oct 25, 2021 9:19:29 PM |

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