Archive for April 10th, 2007

India’s fledgling aviation sector hopes to soar above the clouds

Tuesday, April 10th, 2007

Infrastructure problems and a shortage of pilots prove little deterrent to growth
The Globe and Mail, Tuesday, April 10, 2007

SONYA FATAH

NEW DELHI — When Deepak Khosla arrived at the National Business Aviation Association air show in Orlando, Fla., last October, he was on the hunt for a private jet to ferry guests to and from his planned luxury retreat in Kasauli, India.

Instead, by the time the world’s largest aviation trade show ended, Mr. Khosla had signed a contract for the purchase of 36 business jets worth $252-million (U.S.), with options on 36 more, and formed his own private jet company.

Mr. Khosla — a New Delhi-based businessman-cum-entrepreneur who runs Nargra Industries Ltd., one of India’s largest marble companies, and is in the midst of building a luxury resort in the hills — didn’t make a deal on a jet for the resort. But as he left the venue at the close of the show’s second day, he was already calculating his next venture. Mr. Khosla had come across the stall of an American company marketing a new product: eight-seater business jets with a standing height of six feet, made with cheaper, new technology.

“I went to the hotel and crashed. I woke up at 11 p.m. that night and I leaped to my laptop and started hammering away,” Mr. Khosla said. He banged out a six-page business proposal, and by evening had signed a contract with the American vendor for six-dozen aircraft.

Mr. Khosla’s enthusiasm is not unique in India, where a slew of corporate and commercial companies are entering the aviation sector.

At the Aero India 2007 air show in Bangalore in February, airline companies and hungry entrepreneurs were committing to all kinds of purchases. That’s because India, until recently a relatively small player on the international aviation circuit, is now being touted as one of the fastest-growing markets worldwide.

Since 2003, aviation has been booming in this country of more than one billion people. Domestic passenger traffic in India grew 25 per cent between 2004 and 2005. That figure shot to 46 per cent the next year. With economic growth pegged at 9 per cent for 2007, and a slew of low-cost airlines out to capture the middle-class market, passenger traffic — both domestic and international — is mushrooming.

Private and public airline companies have been on an acquisition spree, buying brand-spanking new fleets to serve their growing route networks in India and overseas. Moreover, India’s corporate bigwigs are adopting the frills and fancies of CEO-dom. A growing number of chief executive officers are taking to the skies in the comfort of private jets, hence Mr. Khosla’s decision. Despite infrastructure problems and a shortage of Indian pilots, the aviation boom seems to be here to stay.

Acquisition figures reflect that growth.

EADS NV, which is the parent company of Airbus SAS, estimates that India’s total commercial aircraft will hover at about 1,100 between now and 2027. Industry projections estimate 500 new aircraft will be ordered over the next five years. And in a very short time span, private airlines now account for about 60 per cent of domestic passenger traffic.

Then there is the big boom in corporate aviation. Already, some of the big Indian corporations own their own Bombardier, Airbus and Boeing corporate jets, carrying men like Vijay Malliya of King Fisher Airlines, the Ambani brothers of Reliance PVT Ltd., and Ratan Tata of the Tata group. Karan Singh of Indo-Pacific Aviation Ltd. believes corporate aviation is growing at twice the rate of commercial aviation.

Yet, not everything is in place to respond to the boom. Airport infrastructure is severely handicapped. Two greenfield airports — in Bangalore and Hyderabad — are under construction, but overcrowded airports and too many flights for air traffic control to handle comfortably are creating congestion and frustration among passengers. And the country’s 40 aviation clubs are not exactly thriving. Many have closed, and among those that are functioning, there is a shortage of flying instructors and aircraft.

There are about 5,000 commercial pilots in the domestic sector today. More than 500 of them are foreign. Across India there are between 10 and 14 chief flying instructors (CFIs), between 30 and 35 regular instructors, and 50 training aircraft. With demand for 5,000 pilots and the capacity to churn out 150 to 300 each year, the sector is confronting a massive demand-and-supply incongruity.

“This is a very good industry but there are a lot of challenges,” says Yash Raj Tongia, CFI and promoter of Yash Air Ltd. “India is the only country where cadets join an airline as a pilot after 100 hours of training. The world over, the phenomenon is that cadets get their commercial pilot’s license, and then join a small chartered company, flying turbines, before they graduate to commercial flying.”

Both Mr. Tongia and Mr. Singh are playing their role in training future pilots. At Yash Air, students train on single- and twin-engine aircraft in preparation for their commercial pilot’s licence. Mr. Singh’s Indo-Pacific Aviation has teamed up with the Oklahoma-based Spartan College of Aeronautical Engineering to provide pilot training, engineering and maintenance skills. Joint ventures of this sort are becoming more common. With an initial investment of $20-million, Canadian flight simulator maker CAE Inc. is setting up an aviation school in Bangalore to train 1,000 pilots a year.

Infrastructure and staffing are minor challenges in the opinion of Rajiv Pratap Rudy, former union minister for civil aviation.

“The government needs to get rid of the 49-per-cent tab on FDI [foreign direct investment] in the aviation sector,” Mr. Rudy said in an interview. “It needs to give incentives to states to support their flying clubs, and it needs to give incentives to airlines to start flying clubs of their own.”

But Mr. Rudy believes these are mere hiccups in the way of aviation development in India.

While there is no shortcut to solving India’s deep infrastructure-related problems, investors and analysts are looking at India’s emerging middle class and growing economy as the perfect combination for a sustained boom.

“Like any relatively free market, there will be casualties,” said Kapil Kaul of the Centre of Asia Pacific Aviation.

“This does not mean that the system is wrong. It needs time to find a dynamic equilibrium. But airline life in India will never be the same again. That is certain.”

*****

Set for takeoff

In 2004, there were 650 commercial and corporate aircraft across India. That year, 65 new planes were registered. The number of new planes rose to 95 in 2005, and an additional 160 were added in 2006.

Government-run airlines Air India and Indian Airlines have been on an acquisition spree. Last year, Air India ordered 68 Boeings for $11-billion (U.S.) and Indian Airlines ordered 43 Airbus aircraft ($2.2-billion).

There are already 130 private planes in India. Industry analysts expect the market for private planes in India will soon become the world’s largest.

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Letter from Kabul

Tuesday, April 10th, 2007

On a sketch comedy show aired on Tolo Television, Afghanistan’s privately owned television station that proudly sprouts the slogan – dawn of a new Afghanistan – there is an endearing nickname for Pakistan: wandistan. Wandh is slang, in Dari, for ‘everything bad’ and wandistan translates roughly to ‘the land of all things bad.’
Pakistan’s credibility is low on Kabul’s pot-holed, war-beleaguered streets. Half of Kabul, it seems, has lived in Pakistan for long stretches of time since Afghans first started crossing into Pakistan 27 years ago. Many have warm memories of their stay in Pakistani refugee camps in Hayatabad or in the larger cities of Islamabad and Karachi. But, they too feel there is a wandhistan across the border.
A week ago AlJazeera television aired exclusive interviews with two young failed suicide bombers. Both men were from south Waziristan and had been sent on suicide missions with specific instructions to attack checkpoints or places were Afghan troops or coalition forces were stationed. One of the two said he didn’t have it in him to press the button, even with the intoxicating carrot of paradise and virgins dangling before him. Afghans understood that the two Pakistani men were poor and relatively clueless, that they have been manipulated through extremist propaganda and other incentives. But that they had emerged the troubled tribal areas simply strengthened Pakistan’s wandhistan image.
“It’s not Pakistanis we don’t like,” an Afghan journalism student told me. “It is the intelligence services and the government. It is their police of strategic depth that we don’t like.”
Indeed, strategic depth has proved to be a disaster for both Afghanistan and Pakistan. With a hostile attitude towards Hindu-dominated India and Shia-dominated Iran, Pakistan’s attempts to prop up Pakistan-friendly Pushtoon governments in Afghanistan have failed. Yet, the biggest psychological disaster has been the government’s support for the Taliban that grew up in Pakistan’s arms but has rebelled against it in its adulthood. That is a difficult and painful memory for most Afghans to forget.
Farzana Samimi presents ‘Banu,’ which means woman in Dari, a daily show on Tolo that addresses women’s issues. She is one among a new generation of fearless young women who have started working in media to challenge the stereotypes and labels attached to their gender. But not long ago, Ms. Samimi, who has a degree in veterinary science, was not allowed to study or work, and had to wear the sky-blue ribbed burqa that is the trademark of the Taliban era. “It took me two years after the collapse of the Taliban to stop wearing the burqa,” she says, dressed today in a smart blazer and pants ensemble with a cheetah-print scarf covering part of her hair. “I was scared. It was very difficult to adapt to the change. I was working at Arman FM and I was covering myself with a chador. A lot of educated women wouldn’t come out on the streets even after the Taliban fell. But gradually women got more courage and things are changing.”
Indeed, today, fewer women on Kabul’s streets don the sky-blue burqa. They are outnumbered by those who don’t. Many young girls are back in universities planning careers, thankful that the Taliban are no more. There are rumours and fears that the Taliban are gathering momentum in areas near Kabul but for now Kabulis, in general, feel very strongly about a future that embraces change, discussion and gender inclusion versus the top-down inflexibility and oppression of Taliban rule.
Afghans see Pakistan’s interference in their internal affairs as a major cause of their instability.
Distrust of Pakistan is aided by a lack of interaction between Pakistanis and Afghanistan. While millions of Afghanis have lived in Pakistan, few Pakistanis have visited or lived in Afghanistan. For obvious reasons, Afghanistan has not been high on Pakistan’s to-do list of tourist destinations. Still, Pakistanis’ unfamiliarity with Afghanistan rankles many in Kabul.
“It amazes me,” an Afghan journalist told me, “how little Pakistanis know about Afghanistan, how few Pakistanis come here to visit or journalists to report. There is one Pakistani who knows Afghanistan and who people respect here — and that is Ahmed Rashid.”
However, a good portion of the Afghan population has a deep and intimate relationship with Pakistan. From gardeners, cooks and drivers to traders and Kabul’s former elite, millions have set foot in Pakistan. “I was in Peshawar for years,” says Lubna, who works with an international NGO in Kabul. “I had a wonderful time. People were very kind to me. Pakistan gave me a home. But we don’t accept the role Pakistan has played in propping up the Taliban.”
“Afghans are split on their feelings towards Pakistan,” says Haroun Mir, a former aide to the late Ahmad Shah Masoud, Afghanistan’s former defense minister and leader of the Northern Alliance. Mir is currently developing a think tank in the hope of creating a bridge between intellectuals in Afghanistan and Pakistan. “Our futures are inter-connected, and we need to break down the walls that separate us.”
Certainly the window of opportunity for that bridge is getting slimmer for Pakistan as India’s more warm, culturally appealing influence spreads through the country. In Kabul, Hindi music is a must-listen, the cinemas show Bollywood films and posters of Aishwarya Rai, the most desired of Bollywood belles, are plastered everywhere. Taxi drivers and Kabulis carry a regular assortment of the best in Afghan music – Ahmed Zahir for old times – and endless collections of the latest in Bollywood tunes, even if they don’t speak Urdu. The Indian government has put in healthy amounts of aid into the region, partnered on and headed several big infrastructure projects, and is seen as a partner recognizing the dawn of a new Afghanistan.
Conversely, Pakistan is associated with destruction. When people think of Pakistan, they think of Gulbuddin Hekmetyaar, of rocket attacks on Afghan soil, of the Taliban and the destruction of the Bamiyan statues.
It’s not too late for Pakistanis to extend themselves to their neighbours both at a governmental level and through civil society. Afghan students should be welcomed and given scholarships to attend Pakistani universities. Academic exchanges should be encouraged. Pakistani students should visit the Afghan capital and familiarize themselves with Afghan history and culture. Pakistani and Afghan musicians should visit each other’s countries and sing for each other’s people. Pakistan should invest in long-term economic projects in Afghanistan. President Musharraf has spoken time and again about developing and nurturing Pakistan’s soft image overseas. But Pakistan’s own backyard is a garden full of weeds.

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