"Infrastructure is the key challenge before us today."These words, starkly spoken, succinctly summed up the sentiments of delegates attending the Indian Air Cargo event. But they resonated ever more clearly because they were uttered by Airports Authority of India (AAI) executive director for infrastructure development, V. K. Kalra.
The task of the AAI is hardly trivial: India has 449 airports, a number that continues to grow, including 16 international airports and seven customs airports. In all, the Airports Authority of India (AAI) manages 128 of these.
In the last four years domestic passenger traffic has surged, growing over 25 per cent while cargo has grown 10 per cent. Long term the AAI is forecasting an 8-10 per cent growth in passenger traffic and a 7-9 per cent cargo growth, according to Kalra.
The problems are numerous he notes, highlighting among others, inadequate runways, parking and terminal capacity virtually across the country. Nearly 40 per cent of passenger traffic is concentrated at Delhi and Mumbai with the top five airportscarrying 70 per cent of the traffic.
Expansion and modernisation
But Kalra highlighted that the AAI is taking steps to decongest the airports along with expansion and modernisation of existing airports.
A unique public-private joint venture model for the expansion and upgrading was adopted for Delhi and Mumbai, while at Kolkata and Chennai the AAI itself will undertake the modernisation and operation of these airports.
The AAI is also promoting investment in greenfield projects, including Bangalore with a total investment of INR483 million and Hyderbad, INR440 million.
New Delhi’s airport also saw nearly INR2.2 billion pumped in for phase 1 and INR1.5 billion for Mumbai while Chennai airport saw INR588 million and Kolkata saw INR486 million.
In addition the AAI is focusing on developing 35 non-metro airports of which 24 will be private-public joint ventures,of which bids for two have been called, Kalra said.
Second airports have also received the go-ahead for Bombay, Goa and Kaloor in Kerala.
The AAI has also identified Nagpur, partly because of its geographical location practically in the exact centre of the country, as a key cargo hub, initially for domestic cargo and later for internationalcargo.
Greater focus on cargo
"Historically AAI has not paid sufficient attention to the development of cargo,"Kalra acknowledged, adding that the cargo development, operations and management will be phased out into private-public partnerships.
Nearly 88 per cent of cargo is currently concentrated around five major airports: Mumbai, Delhi, Kolkata, Chennai and Bangalore. "We sincerely feel the need to have a network in the cargo system to connect far flung areas and provide access to the markets."
"Our intention at the non-metro airports is for air cargo processing facilities to be provided by the new developer,"according to Kalra. At least two cargo handlers will be operating at each airport, although this may not be feasible at smaller airports, he notes. In these cases procedures will be prescribed for deciding the charges.
"Efficiency will be monitored and must be able to handle loose shipments, containerised, perishables, express shipments. Our intention is to ensure bettermanagement."
Obstacles to growth
But other issues including lack of processing space for cargo – currently at around 60,000 sq metres – which needs to be increased nearly four times to 200,000 sq metres just to accommodate today’s growth, let alone future growth.
A shortage of equipment and support infrastructure, including the lack of electronic data interchange system, lack of modern and standardised operational processing methods are all key challenges to developing a better cargo system, he said. These impact all users whether freight forwarders, airlines or logistics players, he added.
But progress is being made, he insists, pointing to the fact a web-based EDI system has been 100 per cent implemented for export cargo processing at Delhi, Mumbai, Kolkata and Chennai.
The entire supply chain reliability has to increase and it has to be visible to the customers, he added. Cargo security threat is another issue.
Key to addressing the many shortcomings in India’s transport sector is the involvement of the private sector, according to Kalra. "We need to encourage the private sector in order to bridge theresource gap and increase Efficiency."