EoIs for divestment in Air India, Pawan Hans in next few weeks: Aviation Secy

Hyderabad: The government is committed to expediting the process of Air India's disinvestment and likely to invite expressions of interest (EoIs) from interested parties in the next few weeks, an official said.

Speaking at the inaugural ceremony of the four-day aviation event 'Wings India 2018', Civil Aviation Secretary RN Choubey said a revised EoI for disinvestment in Pawan Hans is also expected to be floated around the same time.

"Our ministry is presently engaged in the important task of finding buyers for Air India, its subsidiaries and Pawan Hans. We are committed to take it forward very fast," he said.

"We expect that the EoIs for Air India should come out possibly in the next couple of weeks. A revised EoI for Pawan Hans will also be coming forward around the same time," Choubey said.

Last June, the Union Cabinet had approved privatisation of the debt-laden national carrier, which is staying afloat on taxpayers' money.

A group headed by Finance Minister Arun Jaitley has been appointed to chalk out the strategy for Air India's stake sale.

Choubey said India's domestic air passenger traffic has grown over 20 per cent in the last three years. However, because of the increasing oil prices, the growth this fiscal is expected to be around 17.5 per cent.

"Our country has witnessed the highest domestic passenger growth globally in the last 3-4 years and the nearest rival is some 30-40 per cent behind us. We have been growing over 20 per cent in the last 3 three years. This year we are growing around 17.5 per cent because the fuel prices have gone up," Choubey said.

He, however, said that if oil prices remain below USD 80 per barrel, the travel demand is expected to grow at a compounded annual growth rate (CAGR) of 15 per cent over the next 20 years.

The government's regional air connectivity scheme Udan has further boosted traffic growth in the country, Choubey said adding that as many as 56 new airports have been added into the network in the last two years.

Besides, many more airports are expected to be operational in the next six to eight months as by that time the second phase of Udan will also take off, he added.

Udan or Ude Desh Ka Aam Nagarik scheme launched by the central government last year is aimed at connecting unserved and under served airports in the country and the fares under it have been capped at Rs 2,500 for a one hour journey.

About three-and-a-half years ago, the total number of aircraft in the country operated by the scheduled airlines was 395, and they have placed orders for 900-odd aircraft, Choubey said.

"The challenge is we need to double the capacity of our airports every five years to sustain the additional passenger footfall," he said while urging the airlines to deploy more wide-bodied aircraft such as Airbus A380 to meet the increasing demand and deal with the issue of slots at various airports.

The civil aviation secretary also urged the state governments to bring down VAT on jet fuel prices, which accounts for 45-50 per cent of an airline's total operating cost.

Responding to Choubey's call, Telangana IT Minister KT Rama Rao, who was also present on the occasion along with director general of civil aviation B S Bhullar, said that his government will look into the issue.