There are many reasons for Indian airlines, a perpetually struggling lot, to be hopeful: more foreign funding, more overseas routes and cheaper oil. Yet, more than all this, what could embellish the bottom line of Indian carriers next year is a new navigation system in Indian skies that, its makers say, will knock off 20% of the fuel bill of airlines and increase air traffic.
The effect can be potent as fuel costs swallow about 50% of an airline's revenues. At 20% savings, a crude calculation on 2011-12 numbers shows that Jet AirwaysBSE -1.28 % would have turned a Rs 1,236 crore loss into a Rs 90 crore profit, and SpiceJetBSE -0.94 % would have shaved off Rs 439 crore of its Rs 605 crore loss. And if KingfisherBSE -4.91 % hadn't since gone into a freefall, even it would have knocked off Rs 589 crore of its Rs 651 crore loss for the year.
Here's how. Today, when an aircraft takes off in Indian skies, it doesn't trace a straight vertical line to a cruising height. It, instead, rises in fits and starts, with bursts of acceleration. Likewise, between two destinations, it doesn't trace the straight line -- the shortest distance. It, instead, zigs and zags.
Both manoeuvres mean airlines end up burning more fuel than ideal because current Indian air-navigation systems don't allow for the greater accuracy and surety available in some other parts of the world. This is set to change in July, 2013, when the Airports Authority of India (AAI) launches GPS-aided GEO augmented navigation system (GAGAN). "Airlines can save 20% on their fuel costs," reckons S Sundara Raman, executive director (communication, navigation & surveillance), AAI.
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Straighter Routes
GAGAN will catapult India into an elite league in air navigation: this is only the fourth such system in the world, after that of the US, European Union and Japan (see graphic). "It's an eye in the sky," says Amber Dubey partner, aviation, KPMG. "With ground-based systems (the current system), there's a need to have systems at every few kilometre. Here, one satellite tracks everything, and far more accurately."
GAGAN is a superior version of the current GPS system: it can detect activity at a finer level. So, while aircraft in India currently keep a distance of 80-100 miles, GAGAN will reduce this to 30 miles. This will allow thrice as many planes to fly, and reduce congestion on busy routes, as well as make Indian skies safer. Raman expects a six-fold increase in time. He also estimates airlines to reduce their flying time on the Delhi-Mumbai route by 10 minutes.
A senior SpiceJet technical official, speaking on the condition of anonymity, confirms that airlines don't take a straight line between two destinations. "We take pre-determined routes set by the air traffic control centre. For example, between Delhi and Bangalore, we have to take a detour over Bhopal and do a series of deviations that add up to a much longer route," he says. "After GAGAN, we will have what is called 'freedom flights', leading to reduced fuel burn by 18-20%."
GAGAN will also make Indian skies safer. For example, while landing, the current system gives an aircraft the coordinates of a landing strip in a range of 20 metres. By comparison, GAGAN will give it in a range of 20 feet, thus reducing the possibility of human error. The signals on GAGAN will be beamed by three satellites of the Indian Space Research Organisation (ISRO), located at a height of about 36,000 km. Two of these satellites have been launched. A third one is expected to be launched in 2013.
Fifteen ground stations in India, being set up by US-based defence technology company Raytheon, will back the three satellites. "The certification by the Directorate General of Civil Aviation (DGCA, the aviation regulator) is scheduled soon after completion of the operational testing performed by AAI in 2013," says William L Blair, president, Raytheon India.
The fourth partner in the project is Mitre Corporation, another American engineering and technology company that is doing the certification of the AAI equipment, something it had done for the corresponding American system.
More Air Traffic
Besides boosting the financial numbers of airlines, GAGAN will also help Airports Authority of India (AAI). In 2010-11, the latest period for which its financials are available, AAI earned 65% of its Rs 5,139 crore revenues from air-navigation services.
Basically, AAI charges every plane flying over Indian air space, even those that don't land on it. Raman says AAI expects to treble its revenues from air-navigation services by 2015, riding on GAGAN. "About 8-12% of the operating cost of an airline goes to air-navigation charges," says Dubey of KPMG.
As can be seen by its circle of influence in the world map in the graphic, GAGAN can position itself as an alternative to the Japanese MSAS system for airlines flying between Australia/Asia and Europe. That's the pitch AAI plans to make.
"We would attract foreign airlines flying from the Gulf to Europe to use our more efficient airspace after the GAGAN rollout. This will boost our revenues considerably," says Raman. "We may even plough back the greater revenues and lower charges to draw more aircraft traffic."
According to Raman, AAI has drafted a memorandum of understanding with all Asia-Pacific countries so that their airlines can use Indian air space. Also, in order to provide a continuous corridor on GAGAN, AAI is talking to its counterparts in Pakistan and Afghanistan, through the ministry of external affairs, to install ground stations in those countries.
GAGAN can also be used for wide range of applications in surveying and mapping, disaster management, transport and mining. For example, it can alert a regulator to mining activity outside a lease area. Those other uses will follow in time. First off, it will be Indian airlines who will tap GAGAn --- profitably.
The effect can be potent as fuel costs swallow about 50% of an airline's revenues. At 20% savings, a crude calculation on 2011-12 numbers shows that Jet AirwaysBSE -1.28 % would have turned a Rs 1,236 crore loss into a Rs 90 crore profit, and SpiceJetBSE -0.94 % would have shaved off Rs 439 crore of its Rs 605 crore loss. And if KingfisherBSE -4.91 % hadn't since gone into a freefall, even it would have knocked off Rs 589 crore of its Rs 651 crore loss for the year.
Here's how. Today, when an aircraft takes off in Indian skies, it doesn't trace a straight vertical line to a cruising height. It, instead, rises in fits and starts, with bursts of acceleration. Likewise, between two destinations, it doesn't trace the straight line -- the shortest distance. It, instead, zigs and zags.
Both manoeuvres mean airlines end up burning more fuel than ideal because current Indian air-navigation systems don't allow for the greater accuracy and surety available in some other parts of the world. This is set to change in July, 2013, when the Airports Authority of India (AAI) launches GPS-aided GEO augmented navigation system (GAGAN). "Airlines can save 20% on their fuel costs," reckons S Sundara Raman, executive director (communication, navigation & surveillance), AAI.
Also Read:
Surf internet while flying
Straighter Routes
GAGAN will catapult India into an elite league in air navigation: this is only the fourth such system in the world, after that of the US, European Union and Japan (see graphic). "It's an eye in the sky," says Amber Dubey partner, aviation, KPMG. "With ground-based systems (the current system), there's a need to have systems at every few kilometre. Here, one satellite tracks everything, and far more accurately."
GAGAN is a superior version of the current GPS system: it can detect activity at a finer level. So, while aircraft in India currently keep a distance of 80-100 miles, GAGAN will reduce this to 30 miles. This will allow thrice as many planes to fly, and reduce congestion on busy routes, as well as make Indian skies safer. Raman expects a six-fold increase in time. He also estimates airlines to reduce their flying time on the Delhi-Mumbai route by 10 minutes.
A senior SpiceJet technical official, speaking on the condition of anonymity, confirms that airlines don't take a straight line between two destinations. "We take pre-determined routes set by the air traffic control centre. For example, between Delhi and Bangalore, we have to take a detour over Bhopal and do a series of deviations that add up to a much longer route," he says. "After GAGAN, we will have what is called 'freedom flights', leading to reduced fuel burn by 18-20%."
GAGAN will also make Indian skies safer. For example, while landing, the current system gives an aircraft the coordinates of a landing strip in a range of 20 metres. By comparison, GAGAN will give it in a range of 20 feet, thus reducing the possibility of human error. The signals on GAGAN will be beamed by three satellites of the Indian Space Research Organisation (ISRO), located at a height of about 36,000 km. Two of these satellites have been launched. A third one is expected to be launched in 2013.
Fifteen ground stations in India, being set up by US-based defence technology company Raytheon, will back the three satellites. "The certification by the Directorate General of Civil Aviation (DGCA, the aviation regulator) is scheduled soon after completion of the operational testing performed by AAI in 2013," says William L Blair, president, Raytheon India.
The fourth partner in the project is Mitre Corporation, another American engineering and technology company that is doing the certification of the AAI equipment, something it had done for the corresponding American system.
More Air Traffic
Besides boosting the financial numbers of airlines, GAGAN will also help Airports Authority of India (AAI). In 2010-11, the latest period for which its financials are available, AAI earned 65% of its Rs 5,139 crore revenues from air-navigation services.
Basically, AAI charges every plane flying over Indian air space, even those that don't land on it. Raman says AAI expects to treble its revenues from air-navigation services by 2015, riding on GAGAN. "About 8-12% of the operating cost of an airline goes to air-navigation charges," says Dubey of KPMG.
As can be seen by its circle of influence in the world map in the graphic, GAGAN can position itself as an alternative to the Japanese MSAS system for airlines flying between Australia/Asia and Europe. That's the pitch AAI plans to make.
"We would attract foreign airlines flying from the Gulf to Europe to use our more efficient airspace after the GAGAN rollout. This will boost our revenues considerably," says Raman. "We may even plough back the greater revenues and lower charges to draw more aircraft traffic."
According to Raman, AAI has drafted a memorandum of understanding with all Asia-Pacific countries so that their airlines can use Indian air space. Also, in order to provide a continuous corridor on GAGAN, AAI is talking to its counterparts in Pakistan and Afghanistan, through the ministry of external affairs, to install ground stations in those countries.
GAGAN can also be used for wide range of applications in surveying and mapping, disaster management, transport and mining. For example, it can alert a regulator to mining activity outside a lease area. Those other uses will follow in time. First off, it will be Indian airlines who will tap GAGAn --- profitably.
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