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Permanent secretariat for TN GIM The rise and rise of KCP Preserving for the future Editor's Says Tax agriculture Air Asia India will set new benchmarks for budget travel Streamlining mandatory third party cover S Ramanathan – a versatile musician, musicologist The ‘Ayyo-yes’ is no more The Gulf aviation boom When TN politicians can emulate Kerala's No Maha Koottani in TN... L&T: focus on infrastructure and more infrastructure… Plummeting profits of PSBs Land reclamation from sea appears cheaper! Gay abandon in pricing Naidu’s return augurs well for Seemandhra When online building permits work…. Welcome thrust on trade in Modi’s foreign visits... For whom the bell tolls? SoA @ 80 Multi-faceted Venkat Telangana in top gear… Breaththrough in malaria control Cutting the nose to spite the face Insurance companies bleeding, yet no decision on increasing FDI limit! Welcome GST Wise Presidents Poor quality of university VCs Online not in line with brick and mortar businesses... Welcome changes that testify to Jayalalithaa’s return to health Adharma of opposition politics Cement prices continue to rise… IPL - no surprise this scam Moily’s bold thrust Rs.1600 crore paper board plant of TNPL When small is no larger beautiful.. Poor representation for Kerala and TN in Cabinet Readers' Mail Chennai and Kolkata miss opportunity to grow as Delhi and Mumbai A glass full of corruption CIPET hqrs to stay at Guindy – for the present? No mega rail project for Tamil Nadu A welcome initiative by the judiciary Delhi is distant Medical costs hit the roof... ONGC at KG Basin Eternal support for capitalisation of PS banks Bihar elections - the Rajaji formula worked A yen for wastage… A proud Madrasi A C Muthiah – his munificent bequeaths to science Delhi is distant… Paytm karo... Limit foreign borrowings to hi-tech, export potential projects... 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Godspeed, Chief Minister JJ L&T- the specialty of special purpose vehicles Five star activism stalls development activity Fuel for thought The star of Spencers is no more All eyes on Sankara Nethralaya Roaring Ro-Ro facility Mu Sigma – is no more Nuclear power at the nucleus When Ratan Tata visited SRM Things happen by accident and not by design... PC’s preference for professionals Robber barons everywhere The few handicaps... CII projects higher growth… R Sridhar steps down as CEO of Shriram Capital IPL type auction for VCs? S V Raju – a ‘good’ true liberal TELANGANA at last…BUT Remembering Indira Sivasailam... A Grand Finale for SN’s MS centenary at the US… Which side are you, Montek? When nations steal growth from one another… Shaming of Tamils by Tamil farmers at Delhi Kinetic Karnataka Alexa – Talking Wikipedia Revive development banks... The balancing act Welcome focus on core competence Editor's Notes Solar thermal shines… Demise of a media baron... Shanti and Sadhana through Music PPP mode for upgrading Corporation Hospitals Build close rapport with business leaders Funding the un-funded Silver Years of Madras Musings Modi and the lady There was flood of milk. Reason: no milk commissioner! Banning booze... Tribute – Manikam Ramaswami Infrastructure funding – lessons learnt Whistle-Stop Tour of Raghuram Rajan Russi Mody – a tribute When the President was rendered homeless… Convulsions in The Hindu CRS, a jewel among managers, is no more. EEC at the National Media Centre The sea- saw battle continues... Like Hinduism: many paths to reach God... A more liberated TN… Where a state respects its litterateurs… Boy, can you beat these? The Jan Dhan bonanza Fall in crude prices help in oil sector reform Quality silica from Neyveli Noble nonagenarians... Adapt Vajpayee dinner diplomacy The why of tax incentives No engine for this car Revving up the manufacturing sector More heat than light Lalu’s envy, India’s pride More tributes to GR B H Kothari - a tribute Marketing expert Balagopal is no more Delhi Chalo... Strengthen the base... Another Indian music maestro at the UN Pharma – overdose of copying How Air-India loses customs... Inflation: are we emulating Argentina and Brazil? The ‘Jayanthi Tax.’ A friendly business group Where is Rajaji? A rich pool of talent not utilised…. Fortune 500 review F C Kohli - his concerns all embracing Sweet news for TN sugar mills Kulandai was a giant Tihar, Puzhal not different from Parappana Agrahara Tribute GNS - 100: our first subscriber Tatas moving out of urea production... Secularism and anti-Hinduism Mersal magnified Cleaning Ganga – relocate tanneries and install electric crematoria Rahman at CIC Shale gas and its shallow future Maximising the micro pricing … He continues the focus on social amelioration Small units prefers to remain small... Kudos to NDTV... Tribute – M V Murugappan An informal presentation - analytical, forward locking... MHC should not return to its old indisciplined ways Colour-Chem’s colourful KRVS A think tank for Chennai The Swadeshi Trump Quality education through the PPP mode Recognition to role of NBFCs.... to the lack of interest on the part of these to focus on original research. This despite the much lower costs of such research in India. The industry which thrived on the protection of a closed economy and the advantage of a vast domestic market, has failed to organise its evolution on healthy lines An enemy’s enemy is a friend TN accounts for the largest recruits by the IT sector Why this malaise in medical education? Music happens Don’t seem to feel the pulse… Increasing non co-operation of state leaders Sweeter prospects for sugar China invests in India West Bengal: mindless malignancy Computation of GDP – conundrums continue Vibrant Gujarat More Shakthi to Das’ elbow Modi storms Silicon Valley TGS- The king storyteller Towards speedy justice London, London Narayan More Shakti to resource mobilisation... Not just in-laws (and outlaws); they’ve renowned academics at the helm! Diamond jubilee of Egmore Samskrt School Engineering seats go abegging Tribute – UCAL Selvan… Fortune for Indian Airlines Airlines in India: cost and space The nuclear option New IT products of Ramco in the pipeline… Naidu will soon build a new Hyderabad A professional at the helm of IRDA... Shipping woes of Chennai companies Bihar – Nitish Kumar adopts the Lalu model Of course, Gujarat is vibrant Put expensive assets created to use... Dr C Rangarajan returns to Chennai The Ports’ Pasha expands into Tamil Nadu
 
Fortune for Indian Airlines

In the 1950s and 1960s, several countries in Asia and Africa were gaining independence. The first things these countries did were  (a)  invent a flag (b) decide on a national anthem and (c) establish a national airline. But setting an airline and efficiently managing it required both resources and management skills.

The Gulf countries witnessed a huge surge in their incomes post the 1971 oil crisis. Most of these countries are small with little natural resources, except oil. With their sparse population, managing big business was an additional problem. With the oil prices zooming, several of these thought the civil aviation sector, employing manpower from across the globe, can be a lucrative business. Several oil-rich countries set up their airlines in quick succession.

Saudi Arabia, the largest producer of oil and Kuwait were among the earliest. In subsequent years, one witnessed several airline companies established in the Gulf region – Emirates, Gulf Air, Etihad Airlines... These countries also built modern airports. Dubai emerged among the largest of these and competed with the likes of Singapore and Hong Kong. The Gulf airlines, buoyed by oil wealth, went for a large fleet of modern aircraft. Emirates was one of the earliest to go for Airbus 380 aircraft, the largest in operation.

The location of the Gulf, en route to Europe and the US, was a significant advantage. Airlines in the Gulf attracted customers from India, used their home base as their hubs and offered non-stop flights to Europe, the US and other far off places and compete with the established airlines in Europe. In this, they found the large Indian air travel population an extremely attractive target for custom. The sloppy performance of India’s cash-starved national carrier Air India coincided with the surge in air travel from India, and these became great opportunities for the Gulf carriers. Through hubs like Dubai, Abu Dhabi, and Doha, these Gulf airlines offered convenient and often shorter duration flights to the US. Etihad Airlines went one step further in establishing the US immigration and customs department at Abu Dhabi. This helps complete formalities of immigration and customs in the transit time and enable passengers to arrive at US airports as domestic travellers.

The traditional hubs in Europe, Frankfurt for Lufthansa, Heathrow for British Airways or Charles de Gaulle for Air France, have been rapidly losing custom to these airports in the Gulf. These Gulf airlines also offer airfares at extremely competitive rates. Thus, the boom enjoyed earlier by the European airlines has substantially declined giving space to these airlines from the Gulf.

In India, a corresponding change is not taking place at an equal pace. Air India continues to operate international flights from the Mumbai and Delhi hubs. This means passengers from other cities are aggregated in these two hubs. For long, there has been a demand for Air India offering direct flights from the south, but it has not taken place. Two decades ago, Lufthansa started offering direct flights from Chennai, then extended these from Bengaluru and Hyderabad to Frankfurt and then to dozens of destinations in America, Europe, Africa and elsewhere. Private airlines like Jet Airways and later Kingfisher held promise of expanding its destinations to Europe, the US and other places. Again these were constrained by their resources needed for large-scale acquisition of aircraft and for maintaining and improving the services. Kingfisher crashed out.

Jet Airways joined hands with Etihad as an equity partner and has been able to increase its custom for foreign travel. IndiGo and SpiceJet thrive on local custom.  Tatas entered with a lot of promise, simultaneously setting up two airlines – one a joint venture collaboration with Singapore Airlines and the other with the budget airline AirAsia of Malaysia. These are in the process of getting licenses to fly abroad after the recent amendment to the 5/20 rule, which stipulated a minimum of five years’ experience in operation and at least 20 aircrafts.

Indian companies need much larger resources to benefit from the massive increase in the number of air travellers.

The new aviation policy provides exciting prospects to trigger entry of more operators in the Indian aviation sector.

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