INDIA: SpiceJet Required To Pay Rs 28.5 crore

SpiceJet's outstanding towards landing, parking and route navigation charges increased to a large extent between September and October when oil prices went sharply up and rupee depreciated rapidly.

The Airports Authority of India (AAI) has asked SpiceJet to make quick payment of around Rs 28.5 crore immediately in order to reduce the outstanding dues, which currently stand at nearly Rs 115 crore.

SpiceJet's outstanding towards landing, parking and route navigation charges increased to a large extent between September and October when oil prices went sharply up and rupee depreciated rapidly.

In November the airline was asked to deposit Rs 20 crore by November 30 to bring its dues under the 80 percent threshold of the security deposit. The AAI had asked the airline to deposit Rs 2.5 crore per day in addition to the Rs 20 crore.

Rs 20 crore amount was paid. They have been making a payment of Rs 2.5 crore every day, out of which Rs 2 crore will cater to their regular monthly payment and balance to reduce the outstanding dues. We are hopeful that by March, this outstanding amount will come down substantially.

SpiceJet said that all its payments to the AAI are being made as per the schedule agreed upon by the two. There has been no default. SpiceJet remains firmly committed to all its obligations, a SpiceJet spokesperson said.

The airline will make another fast payment by the end of December, however, the exact figure will be decided considering the shortfall at that point of time.

The airline's billings on an average amount to Rs 60 crore on a monthly basis for these services. As per the normal operations at the AAI, officials said that an airline can maintain dues equivalent to half of its security deposit. For SpiceJet, this would come to around Rs 60 crore against a security deposit of Rs 120 crore.

The AAI manages a total of 125 airports, which include 11 international airports, 8 customs airports, 81 domestic airports and 25 civil enclaves at defence airfields.

On an average, SpiceJet operates 416 flights daily to 57 destinations, of which 49 are domestic and eight are international. The airline’s fleet consists of 37 Boeing 737 MAX and NG jets and 23 Bombardier Q-400s.


Tourism Observer

INDIA: Cochin International Airport Insurance Claims Go To Rs 3.4 billion

Cochin International Airport Ltd (CIAL) and the Airports Authority of India (AAI) have filed claims total of Rs 3.36 billion with New India Assurance (NIA) General Insurance company owing to the damage caused by the recent floods in the state, said a Senior Official of CIAL.

A Sr Executive confirmed the development and said that the insurance company is assessing damage to the airport’s assets. The insurer expects to pay out a little over Rs 2 billion towards the claim.

However, this is a preliminary estimate as the investigations are only in an early stage.

CIAL closed its operations for 14 days from August 15,2018 as many assets of the airport were submerged under water and found to be destroyed.

The assets damaged includes the main runway, taxi bay to the terminals, 22 X-ray machines, all furniture at the domestic terminal, 4 conveyor belts as well as the solar panels which power the airport. A big wall also collapsed.

Total damage to the assets and operations of CIAL is estimated to be Rs 3 billion.

Earlier this month, CIAL said it would be creating a master plan with technical consultant Kitco, along side the state government, to build capabilities to meet emergency situations like floods or other natural calamities.

The company, will also rope in two Dutch consultants to assess the master plan, given the latter’s expertise in tackling flood-related problems. CIAL resumed full-scale operations on August 29 and began to work on repairing damaged assets at the airport.

The Kerala government has estimated that the state suffered estimated losses of about Rs 200 billion as a result of the floods.

On August 8, the state received 310 mm rain over 24 hours, which prompted the government to open around 24 dams as the water levels rose to unsafe levels.

The government opened the Idukki dam on August 9 which has not been happened in 26 years.

Following opening reservoir gates at multiple dams, several districts were submerged and over 11,000 houses have been damaged. About 252 people were killed and nearly one million were moved to relief camps.

Now that the flood waters have receded, reports suggest that people are leaving the relief camps and going back to their homes.

Analysts estimate that due to floods in the state, the general insurance industry will receive claims in excess of Rs 10 billion, while life insurance companies could receive claims between Rs 4.5 billion and Rs 8 billion.

Insurance executives and the regulator are working on the contours of a catastrophic insurance policy that state governments and large companies can purchase to guard against huge financial costs of repair and rehabilitation incurred in the event of a natural disaster.


Tourism Observer

INDIA: Air India Suspends Staff

Air India (AI) on Friday suspended a security assistant at Raja Bhoj Airport here for alleged misbehaviour with staff and lapses in performing his duty.

An inspection team from the AI HQ in New Delhi arrived on a surprise check and found irregularities in Anand Sharma's work, said AI general manager (MP-CG) Vishrut Acharya on Friday.

"Sharma was suspended by the Air India headquarters following complaints of misbehaviour filed against him by the Airports Authority of India, CISF and others," he added.

Sharma was posted in Bhopal for the last eight years, Acharya said. Officials would not give out details of Sharma's "misbehaviour" with colleagues or his lapses in work.

Sources said that Air India had been receiving complaints against Sharma for quite some time, which forced the authorities to take action against him.