Wednesday, December 26, 2007

Civil aviation on a high Anshul Dhamija | TNN

Civil aviation on a high Anshul Dhamija | TNN
Bangalore looks set to fly high on the back of India’s aviation boom. Not only is the Silicon City the chosen hub for domestic and international carriers, it could soon also be the country’s backbone in aviation engineering and services.
The central government’s offset policy is expected to bring aviation offshoring deals worth over $10 billion to the country in the next couple of years, and much of that is expected to come to Bangalore.
Under the offset policy, any purchase order by a defence entity or stateowned civilian carrier from a foreign firm will have to ensure an offset or reinvestment of at least 30% of the order value. The reinvestment by foreign firms can either be through procurement of components and services from India or via direct investment.
According to Kapil Kaul, CEO (India) of Centre for Asia Pacific Aviation (CAPA), “Bangalore will get over 70% of these offshoring deals. Most of these engagements will be in IT support solutions, software development, avionics and engineering areas.’’
Facilitating this huge inflow of funds is the proposed 1,500-acre aviation SEZ near the upcoming international airport at Devanahalli. According to senior bureaucrats, the process of identifying land is underway and a final decision would be taken in the next six months.
Karnataka will also see investments close to Rs 1,500 crore in the setting up of MRO (maintenance, repair and overhaul) facilities. While Rajeev Chandrasekhar’s Jupiter Aviation is investing Rs 500 crore to set up an aircraft maintenance and modification facility at Hassan, Vijay Mallya’s Kingfisher-Deccan plans to set up a Rs 300-crore MRO facility at Devanahalli.
All this action is partly the result of Bangalore’s historic connection with aviation and aviation technology, following the establishment of HAL, and partly the result of the more recent surge of passenger traffic growth from and into the city. Bangalore reported a 40% growth in international passenger traffic in the one year between September 2006 and August 2007 as per the Airports Authority of India.
That’s the highest in the country and more than double the all India average growth of 16%.


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