Significant opportunities on offer I There is undoubtedly an enormous amount of potential to be unlocked by the Indian air freight industry but numerous challenges need to be overcome


t appears that the much-debated FDI (for- eign direct investment) in India’s retail sector is coming to fruition. While the government and the businessmen are opti- mistic of its positive impact on the


economy, what’s in it for the air cargo business is a matter of debate. “The firm decision of the government will


certainly benefit the Indian air cargo business, especially domestic air freight, because of the


vast geographical area offered by the Indian market and the min- imum local


sourcing


requirements proposed in the policy,” notes Bashyam Govin- darajan, chief operating officer at Tirwin Management Ser- vices, a Chennai-headquartered consulting and training firm. “The biggest challenge is in


preparing the Indian air cargo industry to meet the emerging demands,” he warned. While domestic air cargo is


expected to register significant growth over the coming years, there appears to be no value addition to the products and services offered. The market is also highly dependent on the bellyhold space capacity of the scheduled pas- senger airlines. Govindarajan believes that there is a need to connect places of production, storage and con-


Bharat Thakkar, president of the Air Cargo Agents Association of India (ACAAI) and man- aging director of Zeus Air Services, an Indian freight forwarder, believes that much could be done to improve the country’s air freight industry. During the Gulf War, when the air freight


industry was hard-hit, he notes: “Zeus stepped up in southern India, offering services to the leather industry and other niche markets.” Little could be done to overcome the weak


infrastructure in Madras and Mumbai, he said, or to speed up processing in the congested European airports. But to expedite transit times, Zeus allied


Govindarajan: “emerging demands”


sumption with larger networks and more capacity. “Although the government


has already simplified the pro- cesses and requirements to start cargo airlines, the high cost of operation mainly due to vari- ous taxes is holding people back from venturing. “The government should


provide financial relief for start-up air cargo operations and explore the possibility of opening up hundreds of non- operational airfields spread across the country.” These initiatives would not


only support the air cargo business but also pro- vide a fillip to rural economy of the country, Govindarajan considers. Plus: “The domestic air cargo industry also need to focus on its pro- cesses and people since both need significant improvement,” he concluded.


Further infrastructure improvements required


with various carriers to introduce direct deliv- ery from their hubs to consignee by bypassing the congested European airports. According to Thakkar, this move not only


saved 48 hours in wasted time but also saved the costs of double-handling. “India is one of the rapidly emerging


economies of the world and its air cargo industry is matching this economic growth. “The main hurdle in the growth and effi-


ciency is the inadequate infrastructure, including that at the airports, and the absence of coordination amongst others,” he pointed out. “Streamlining, rationalisation and changes to Customs are critically required.”


Air India takes delivery of its first two B787 ‘Dreamliners’


Flag-carrier Air India has declared itself more than happy with the delivery of its first two B787 ‘Dreamliner’ aircraft (see p2). It has a total of 27 of the all-new aircraft type on order at Boeing. “We’re delighted to be the first airline in the world to take delivery of a Dreamliner from this


beautiful factory (in North Charleston, South Carolina) and look forward to taking many more,” notes Air India board member KM Unni. “The 787 is an airplane with unmatched effi-


ciency and technology, which will help in our airline’s turnaround plan," he added.


Page 10


15 October 2012


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