This link from Skyscrapercity.com gives a very nice aerial view of HAL airport. http://www.skyscrapercity.com/showthread.php?t=327688&page=57

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Devesh,

Noted yr article - very well written, & hope they work on it fast & do not have to play 'catch up' games, as things have always been in bangalore on every front, be it airports, roads, transport, etc.

naveen

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Mr. Devesh,

Thanks for the update on the cargo side of the BIAL. Hope it will be pleasing to the eyes of Mr. Brunner.

 Taking your pitch for keeping the HAL airport open, Is it economically viable to make the HAL airport Cargo only? May be it is too late now? But as an option what is your take on this?

Regards,

Syed 

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in my view, or understanding, Cargo is largely carried in passenger planes - maybe not all but I have seen a lot go in the SQ and EK flights. Even BA and AF have cargo containers waiting (basically the wide bodies have place for cargo) But there are a few airlines withcargo only planes (LH flies a DC12, EK flies a 747...) I also think this is one of the main revenues so I dont think BIAL will give it up so easily

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As one SEZ has been approved near the airport, would it be easier for BIAL to build/develop anything related to its business? (something like a free trade center Devesh mentions in his above blog)

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Syed answered the question correctly. A significant part of cargo is sent by passenger aircraft. There are also dedicated freighter services by SQ, EK, LH (MD11 not DC12 :)), TransMile and a few others. So HAL as a cargo hub is ruled out.

BIAL has already applied for approx 400 acre SEZ. The high UDF on us now, is to finance the second phase of expansion of the airport, and may be the SEZ.

I have also posted a new article http://deveshagarwal.blogspot.com/2008/04/i-am-not-against-bia-or-bial.html. Please do take the time to visit.

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Regards

Devesh R. Agarwal

Visit my aviation blog at http://deveshagarwal.blogspot.com

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sorry meant MD-11 :) I feel BIAL has an edge over other airports in terms of expansion. The architecture being modular allows expansion in sections (as the roof indicated) rather than having to wait for the entire second terminal to be ready. I still feel there is not enough of a response from the governemnt in terms of connectivity - the hue and cry seems to have lulled now!...If our screams could continue in that direction we can all be a lot happier. The idea of a CAT (City Airport Terminal) can be applied to cargo as well. Can't Menzies/Bobba and Air India/SATS have a pick-up or drop-off centre in the city? They can run dedicated trucks in the containers to and fro the airport.

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Narayan

As I have stated before, the terminal is not really the capacity issue. We all know the terminal is modular and can be expanded quickly. The capacity constraint is the runway. If you see my article http://deveshagarwal.blogspot.com/2008/04/flying-at-time-of-bias-convenience-not.html, BIA has already hit the 30 flights per hour limit at the peak hours. This is when almost all traffic of the airport flies in any case.

I think the government now is immune to all the screaming. The elections have taken over. No time for roads, now it is time for Rs. 2 rice, colour TV, free power, and everything that can be looted from your pocket and mine and everyone else, and be re-distributed. :))

I had proposed to Mr. Brunner using the AAI terminal at HAL with a dedicated high speed BMTC bus from one HAL terminal direct to BIAL terminal. He said no. Why ? They do not have the computer terminals. At the same time he was aspousing setting up 7 CATs around Bangalore, with fresh investments in computer equipment, check-in stations, data connectivity etc.

Does that not sound hypocritical to you ?

Do check out my new article. http://deveshagarwal.blogspot.com/2008/04/i-am-not-against-bia-or-bial.html, if possible please leave a comment on the blog site itself.

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Regards

Devesh R. Agarwal

Visit my aviation blog at http://deveshagarwal.blogspot.com

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It seems to me that maybe AAI and HAL aren't to keen on handing over HAL Airport (PTB) to BIAL. They haven't come forth or even been questioned. Even if BIAL does agree (indirectly) to operate a second airport out of HAL, HAL needs to be willing to do so. If you see my article http://ibengaluru.blogspot.com/2008/03/in-response.html (which eventually got published in the TOI). If HAL is closed then its going to get "0" revenue from commerical operations. If BIAL does get a subsidised lease, and control ground operations/charge UDF then it will be a profit for both. Landing charges can be the same as the ones in BIAL with maybe a surhcarge for HAL. Of course this is going to be less money than what HAL is getting now but its better than NO money! In a report a while back, HAL chairman Mr Baweja, stated that HAL would require the airport to develop non-commerical activities, and he was not in favor of letting BIAL run in. Ofcourse if the government takes a decision his say is not much of a obstruction! Interestingly Devesh - we were sitting next to each other at the TOI Unlock banagalore! I think?

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sorry to hear about your mother's accident. hope she is doing well now. thanks for all the info and your tireless efforts. i personally learnt many a things. you have highlighted many areas where bia has to pick up its game. i personally have also enjoyed your language. not everyday you get to read such prose on blogs. there is a lot of value to what you are pointing out. but i am not sure, if it flows naturally from your arguments that hal is to be kept open to compensate for the shortcomings of bia. i dont see how hal can compensate for bia's shortcomings all. for me the most compelling argument for hal is that it is a strategic counter weight to bia. udf is one of the things that bial should be knocked into senses about, especially until the regulatory body is set up. for atleast 25 years they are going to have a free range leasing out land in the airport area. that should take care of most of the business side concerns of bial. i am sure they are going to earn more than the industry norm of 18% on investment. about land, i dont understand what you mean by sold. at the end of concession period, the entire airport including land is going to be reverted back to the city isn't it? regarding cargo and the facility 7kms from bia, are you talking about the horticulture market that KA govt is working on? i posted the same reply on your site.

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 Hi Narayan

There is resistance on both sides. BIAL is not keen on the AAI run terminal at HAL Airport, and AAI is ducking under "we are under Delhi's command" bureaucracy.

The stand of HAL during the PIL hearing shows the complete command of MoCA over the process. The Hon'ble court had asked HAL and AAI to respond about capacity issues raised in the PIL. HAL counsel and AAI counsel said something like "We are a Government of India entity, and we will follow GoI policy".

HAL will follow whatever instructions it receives, and these instructions, regardless of route, will all originate from Rajiv Gandhi Bhavan.

HAL does not have that many test flights that we have to think of it as a mega defence base. What it does have is tons of space for private jets, overnight parking, and other facilities. It may not bring the huge revenue that HAL was getting, but it definitely will not be peanuts. As afluence levels rise, corporates in India will increasingly move to private jets.

Talk of a mall is utter nonsense. I do not believe that HAL will part with the land for non aviation related activities.

Yes, we were. Now that I have seen your photograph. Bangalore Mirror is having a similar seminar called Devana Yelli ? on 3/May 10am at West End. Hope to meet you there as well.

Regards

Devesh R. Agarwal

Visit my aviation blog at http://deveshagarwal.blogspot.com

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Hi TS

Thanks for your comment. It got me thinking. I have posted a blog article http://deveshagarwal.blogspot.com/2008/04/case-for-keeping-hal-opening-in.html for everyone's kind perusal and comment.

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Regards

Devesh R. Agarwal

Visit my aviation blog at http://deveshagarwal.blogspot.com

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Hi Devesh,

The last post on your blog has made things much clearer as it has knit together all 'pieces' very well.

From the beginning, I had a similar feeling - that Airport capacity projections were being underestimated - statements by Mr.Brunner like "we will never exceed the capacities of Mumbai or Delhi", & "We will need to start expanding as soon as possible" were contradictory, & I was wondering if even the 40 million passengers per annum maximum would be sufficient in the long term, given the phenomenol growth rates, that were apparent to me on each successive visit to HAL to take off or land. I of course did not have facts & figures, but now, with your detailed assessment, I am more than convinced that the city's air taffic, if unrestrained to grow, will hit the 40 million mark very soon, perhaps within the next 10 years, or even earlier. What happens then ?

Unfortunately, our politicians & planners are caught up in so many webs & tug-of-wars that it might have seemed politically correct to accept opinions & directives from the 'high command' in Delhi, though not well-aligned with the city's long-term interests, than to face up hard realities & accept that the knowledge capital of the country might, in the future, overhaul Delhi & might start challenging Mumbai too, as far as air traffic & buisness travellers is concerned - the city already contributes the 2nd highest income-tax revenues & is home to the 3rd largest no. of high networth individuals.

The state's political weakness appears to have contributed to this - state politicians do not seem to recognize the importance of the city for the country & are easily willing to bend & accept directives from central govt, even if it is detrimental to the interests of the state & the city. The neighbouring states have strong regional parties, that have consistently been making demands since they have enjoyed better political clout.

I am not sure how things will shape up in the future, but I feel that restraints on air-traffic may be imposed on the city's airport/s due to these various constraints which may stifle natural growth, whilst buinesses & travellers will continue to complain that the state has poor planners !

I would appreciate any comments.

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Devesh, Went through your article. I agree that keeping HAL is a viable option - BUT the duo (BIAL and HAL) must run together and not as competitors - as I have repeatadly discussed before. However I am not convinced at labelling HAL as a Low Cost airport. Again as I stated before, if you restrain HAL to turbo prop flights - it is most likely to have only Jet & Kingfisher (deccan included). Also since we will have only short haul fligts, LCCs that fly multi destination would have to go to BIAL. Also LCCs might not want to invest in Ground handling at two airports serving the same city. It would be better that HAL be a luxury airport as well, with a developed terminal building and services matching BIAL (and hopefully run by BIAL.)

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Hi Naveen

It is partly an under-estimating problem, but probably more a situation of explosive growth catching everyone off-guard. However, instead of acknowledging the problem, we find an "Ostrich - head in the sand" approach.

India crossed 100 million passengers this year, and MoCA has predicted 400 million by 2020. So Bangalore has the potential to grow to 40 million if not more. The important issue is -- does it have the capacity ?

Reading the newspapers, and comments attributed to various officers of the company, and the court representations, the capacity of the airport is anywhere from 9 million to 14 million. I am confused.

One way to find out is to let the airport open as soon as possible, while holding off on the closure of HAL airport (put HAL in suspended animation).

I honestly do not feel that political weakness at the state level has much to do with the airport capacity. It is responsible for lack of proper connectivity.

The clearing of hurdles for the various private airport operators has come from Rajiv Gandhi Bhavan in New Delhi. We all know certain truths so I will not say more :))

You are very right on the impact on business. You may have read about TN government wanting to construct an airport in Sriperumbudur. It is obvious TN government has decided to convert that area in a hardware park and is taking steps to improve it further.

Just for your info, there is a new article on my blog.

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Regards

Devesh R. Agarwal

Visit my aviation blog at http://deveshagarwal.blogspot.com

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Hi Narayan

I agree with you that HAL and BIA should have a cooperative approach I respectfully disagree that one entity must run both airports.

GLobally there is pressure to reduce operating costs and improve efficiencies. A monopoly will not achieve it.

I suggest you visit http://ardent.mit.edu/airports. This MIT professor has written a lot about LCC, main airports and secondary airports.

Some papers I recommend are :

http://ardent.mit.edu/airports/ASP_papers/japa%20paper.pdf

http://ardent.mit.edu/airports/ASP_papers/Accommodating%20Low%20Cost%20Carriers--%20revised.pdf

http://ardent.mit.edu/airports/ASP_papers/no-frillstrbtext.pdf

It is important to have two seperate entities running each airport. Diversity of thinking and approach will increase competition and deliver better results at higher efficiencies and lower costs to all consumers. Passengers and Airlines.

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Regards

Devesh R. Agarwal

Visit my aviation blog at http://deveshagarwal.blogspot.com

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Great picture. Pity it is copyrighted. I could have used it and annotated it.

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Regards

Devesh R. Agarwal

Visit my aviation blog at http://deveshagarwal.blogspot.com

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Yes, true - ideally it should be competition not co-operation - but we should have planned better for it. Look at it from BIAL's P.o.v, why would they allow competition with the contract in hand? Fighting against them, will only lead to a lenghty legal process, that in the end will leave someone with a bitter taste. Or in other words either the investor or the citizen will have to step down. As I see it, a solution has to be worked out in favor of both.

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This is a picture of HAL airport - a very very long time ago!..Intersting to see...

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Hi Narayan

I have written an article on precisely this subject. http://aviation.deveshagarwal.com/2008/03/bial-needs-to-soften-their-stand-no.html.

To quote two paras from it.

Rajeev Chandrasekhar, Member of Parliament from Karnataka and President of FICCI, summed it up well in this news story in Business Standard. “Commercial contracts and investments made in good faith in our state must not be put at risk. At the same time, it is the government’s obligation and responsibility to ensure public interest is best served. Bangalore International Airport Ltd (BIAL) and its shareholders must as well be reasonable towards a solution - that as long as their investments make reasonable returns, they shouldn’t push to maintain a monopoly”

The second is

A commercial venture has to operate in harmony with the community it serves. The past episode of Enron, taught us, that a commercial agreement which impedes rather than promotes its original purpose of serving the public interest, will cause the opposition and resentment from the very public it was meant to serve. The promoters of BIAL should listen to the voices of reason echoing in chorus, and take this proposal positively to re-negotiate their Concession Agreement.

I have a link to another blog article which is an on-site assessment of the terminal. It is written by a blogger called Sinperz. http://aviation.deveshagarwal.com/2008/04/sniperz-blog-bangalore-airport-daylight.html. It is worth a read. I do not agree with the title of the article though.

Like it or not, no commercial venture, private, public or PPP, can oppose the will of the public. In a democracy, politicians are at best temporary "friends". How long do you think, is the period, before the gloss of a new airport wears off, and the honeymoon comes to an end ?

This is a great opportunity for BIAL as a company to earn public goodwill. Something not easily obtained.

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Regards

Devesh R. Agarwal

Visit my aviation blog at http://deveshagarwal.blogspot.com

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