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Indian Economic Policy

Notes (c) it would reduce duplication of services, wastage of flying hours and thus would reduce costs
and losses.
In 1953 the Parliament passed the Air Transport Corporation Act under which the Indian Airlines
Corporation was to run internal services and Air India International was to run external services.
Since nationalisation, improvements in all directions have taken place. New aerodromes have been
constructed. Both internal and external services have been extended.
Airports
There are a number of agencies which are involved in providing civil aviation services in India. While
Air India, Indian Airlines and Vayudoot provide air services, International Airports Authority of India
(IAAI) and Director General of Civil Aviation (DGCA) provide infrastructural facilities. IAAI looks
after the development of the four international airports; DGCA is responsible for maintenance and
development of civil aerodromes, civil enclaves and aeronautical communication stations.
There has been rapid growth in air travel due to acceleration in economic activity in recent years. The
Planning Commission anticipated air traffic to grow at the rate of 18 percent per annum. But during
the Tenth Plan period, the actual growth rate was between 24 to 28 percent. As a result, airlines have
been facing infrastructure constraints due to limited landing slots, inadequate parking bays and
congestion during peak hours. Moreover, there is considerable suppressed demand for domestic air
travel because many regional domestic airports have not been upgraded. The 11 Plan has given
th
high priority for provision of infrastructural facilities at a much faster pace.
The Government of India has selected two joint venture companies (JVCs) to modernize, upgrade
and operate Delhi and Mumbai airports. This step to restructure and modernize the Mumbai and
Delhi airports through the joint venture route has been taken despite stringent opposition from the
left parties. It has been estimated that capital invested to the extent of nearly ` 7,960 crores and ` 6,130
crores would be required for Delhi and Mumbai airports. The Government has decided, in principle,
to modernize Chennai Airport through JV route. It may also be mentioned here that construction
work at greenfield airports of international standards at Bangalore and Hyderabad has already
commenced. The two airports are expected to be operational in 2008. “In principle” approvals have
already been given to construct greenfield airports of international standards in Goa, Ahmedabad
and Trivandrum.
Five Year Plans and Civil Aviation
The Seventh, Eighth and Ninth Plans have kept certain important considerations while planning for
investment in civil aviation. In the first place, they have planned for rationalisation of air services
and of tank structure. Secondly, some of the tourist routes served the domestic services were showing
heavy losses incating the need to strengthen tourist promotion and development programmes. Thirdly,
indiscriminate pansion of air services had resulted in increasing haul operations and raising fuel
consumption. Fourth Vayudoot services have been integrated with the service of Indian Airlines and
are operated as feeders to the non service centres of Indian Airlines. Finally, the Seven Plan emphasised
the need to set up a separate organisation for running helicopter services to meet the requirement of
helicopters by ONGC for air transport support for the operations.
The five year Plans included specific programmes for the different agencies providing civil aviation
devices in India. The programme for Indian Airlines included acquisition of aircraft, modernisation
of work shop facilities, etc. The programme for Air India included acquisition of additional aircraft,
increased capacity for freight traffic, strengthening of workshop training facilities, etc. The programme
of IAAI include completion of international terminal phase II at Bombay international phase I at
Delhi and Madras domestic terminal complex. DGCA programme included instation of flight safety
equipments such as air route surveillance radar etc.
The Communication System in India
The communication system comprises posts and telegraphs, telecommunication systems, broadcasting,
television and information services. By providing necessary information about the markets and also

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