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Experts give mixed reactions on new airport for NCR

IANS  |  New Delhi 

Experts on Friday gave mixed reactions to the civil aviation ministry's proposal for building a new airport in the national capital region (NCR). The proposal has been forwarded to the cabinet for its approval.

The proposed new airport is supposed to come up in the next three to four years time on an area spanning 2,200 acres at Jewar in Greater Noida.

"Two airports will be good for competition in this sector, it will be good for the passengers as they will get more choices in terms of distance to the airport. Airlines can also expect different charges and choose the one most suitable to their needs," Amrit Pandurangi, senior director, Deloitte in India told IANS.

Some experts told IANS that an expanding NCR and the increasing population has become the pressing reason for having another airport.

"The population base warrants another airport. This will be in line with the practice being followed in major international cities like New York, London or Paris," Pandurangi said.

Rajiv Chib, associate director for aerospace and defence with PricewaterhouseCoopers said that the NCR needed a new airport because its catchment area has six crore inhabitants and a growing air traffic.

"With a population of six crore in the NCR region and the growing air traffic, this is the need of the hour. However, I visualise it to be operational by 2020," Chib said.

Currently, Delhi is the hub for Air India, Vistara, SpiceJet and IndiGo, while the large fleets of Jet Airways and GoAir are also parked here.

However, detractors of the proposal claim that the existing IGI airport, which can handle 62.5 million passengers per year, still has ample land and capacity left under utilised. The airport handled a traffic of 40.9 million in 2014-15.

The maximum capacity of the airport, if further expanded, can reach 100 million passengers.

The airport also has a capacity to handle 1.5 million tonne of cargo, whereas it actually handled only 0.7 million tonne in 2014-15.

"Airports are a costly and a lumpy investment. That's the reason why hub airports are built for a capacity of 80-100 million and then connected to the hinterland by way of mass rapid transportation systems through road, rail and waterways," Amber Dubey, partner and India head of aerospace and defence at global consultancy KPMG (in India) told IANS.

"NCR may need three or more airports a la London or New York some day, but that is several years away," Dubey said.

According to Dubey, two airports in the NCR, for a combined load of around 50-55 million passengers and about 1-1.5 million tons of cargo, will increase the airport tariff per passenger and per ton of cargo.

Dubey cited that the situation in NCR is different than that in Mumbai and Goa where the existing airport are fast approaching saturation.

"It will be problematic for airlines, cargo and other industry stakeholders to duplicate staff at two airports for such a small demand base. For international flights, passengers from Jewar's hinterland may still have to take the long road to IGIA," Dubey said.

"The union cabinet may do well to ask first for a thorough techno-commercial viability analysis and industry consultation, rather than taking a hasty political decision," he added.

Analysts point to the fate of the Montreal-Mirabel International Airport which was intended to replace the existing Dorval Airport as the eastern air gateway to Canada.

However, Mirabel's distant location, lack of transport links and continued operation of flights from the Dorval Airport, led the Mirabel airport to be finally converted into a cargo airport.

"Its too early for a second airport, as the first one has an ample land bank and hasn't reached its full capacity levels. There is also a need to protect the commercial interests of the incumbent operator of the IGIA," said Kuljit Singh, partner-infrastructure practice with Ernst & Young.

"The government has to also see how to make the second airport viable, while the first one does not suffers losses. This can be done through viability gap funding or resource sharing," Singh added.

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First Published: Fri, June 26 2015. 19:14 IST