Air India to shift, unused capacity in existing bilaterals may be mobilised.
The civil aviation ministry has prepared a blueprint to convert Delhi airport into an international hub for passenger airlines with effect from August this year to help the airport, which is being expanded by a GMR-led consortium, utilise large amounts of additional capacity that will be ready by July.
A senior civil aviation ministry official confirmed the development and said the decision has been conveyed to both international and domestic carriers. A meeting has been scheduled in March to finalise the details.
Under the plan, the government decided that National Aviation Company Ltd (Nacil), the company set up after merging flag carrier Air India and domestic carrier Indian Airlines, will set up its hub in Delhi (Delhi currently serves as the hub for domestic operations and Mumbai for international operations).
The government is also planning to make Delhi a regional hub to connect south east Asia to Europe by leveraging the capital’s strategic mid-point location, a ministry official added.
The ministry has also decided to lift earlier limits on allowing more flights under bilateral agreements, which was originally done to protect domestic carriers. "We won't sign any new bilateral agreements, but any unused capacity available in the bilaterals would be given out," said the ministry official.
The plan is to allow more airlines to land in Delhi and use domestic airlines for onward flights via code-share agreements in hub-and-spoke arrangements.
“After the new terminal comes up, Delhi will be the primary hub for Nacil, and all that is needed to make it a hub — which basically means operating more flights from and to Delhi from global locations — will follow," says a senior Nacil executive.
Air India operates 12 international flights from Delhi and 17 from Mumbai, a large chunk of which is expected to shift to the capital now. Air India will move its international flights by using the erstwhile Indian Airlines network in Delhi.
“As far as the infrastructure at the airport is concerned, it will not be a problem and we will be the largest operator in the new terminal,” said an Air India official.
This new arrangement means Mumbai, which has an annual capacity of 25 million, will see fewer Air India flights, until a new airport planned in Panvel comes up with a capacity of 40 million by 2030. A Mumbai International Airport official declined to comment on the civil aviation ministry's plan.
Ministry officials, however, clarified that Hyderabad airport will continue to be positioned as an international hub for the southern part of the country and said it would not be impacted by the moves in Delhi.
Hyderabad airport has a capacity to handle 12 million passengers annually and plans to expand to 40 million, though a timeframe has not been fixed.
Airlines executives confirmed that a meeting was held late last month in which domestic airline companies were requested to prepare plans to bring more international flights to Delhi.
“We have called a meeting to finalise all details in March and till that time, we have asked airlines to get into the code-sharing alliance needed to make the Delhi airport a hub," a civil aviation ministry official said.
Underlying the new plan is the fact that huge capacity is coming up in Delhi, which many experts say was based on growth projections that did not materialise because of the aviation downturn of the last few years.
After the new terminal is opened in July 2010, New Delhi airport will have the capacity to handle 60 million passengers annually and 75 aircraft per hour. The airport currently handles 23 million passengers a year and 28 aircraft per hour.
Passenger numbers in Delhi airport fell 9 per cent in 2008 over the previous year and stayed in the negative in the first half of 2009, rising only in the next six months.
The proposed new terminal has four boarding piers with 48 boarding gates and 78 aerobridges, the highest for a terminal of its size. Three aerobridges will cater exclusively to Airbus 380 aircraft.
Airlines say the move will mean more business for them. Says Ajay Singh, director, SpiceJet: "Of course this will mean more international flights will come to Delhi, and carriers like us will have more customers to fly onwards. Its a win-win situation and it has been made possible because of the new infrastructure coming in Delhi airport which allows the increase in traffic."
“We already have a code-sharing agreement with the airlines and after the infrastructure at the airport is upgraded, I do not think we will have any problems with that model,” said a Jet Airways executive.
But experts say the hub concept is not easy to develop “Even though Delhi is strategically located, a hub should have a strong home-grown airline and the government will have to offer more bilaterals to make it a success,” said Kapil Kaul, India head of the Centre for Asia Pacific Aviation.
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