1. T.F GREEN AIRPORT, RI LCC TERMINAL AT KLIA IG INTL AIRPORT DELHI LOW COST CARRIER MODEL IN INDIA SUSTAINABILITY CHALLENGES Prepared by Manisha Gupta

3. Role of Airport Infrastructure in Economic Growth

4. Airline Industry Landscape

5. LCC Landscape in the Indian Airline Industry

6. Why LCC Model is Critical for the Indian Airline Industry

7. Policy Challenges

9. AIRPORT INFRASTRUCTURE ROLE IN ECONOMIC GROWTH FRAMEWORK 1980s Current Millennium 1990s

10. AIRLINE INDUSTRY LANDSCAPE

11. LCC LANDSCAPE IN THE INDIAN AIRLINE INDUSTRY

12. WHY LCC MODEL IS CRITICAL FOR THE INDIAN AIRLINE INDUSTRY

13. POLICY CHALLENGE: LACK OF SECONDARY AIRPORTS Of the total of 449 airports, the AAI operates only 61 airports The top five airports account for 73.5% of total air traffic in India The average distance between a major airport and its nearest secondary airport is around 300 km Airport Infrastructure Policy prohibits Greenfield airport 150 km nearby an existing airport Kuala Lumpur International Airport was built in 2006 at an approx. cost of US$35 million LCC Terminal is a simple setup with no frills -single floor area, straight individual feed, 72 check-in counters, parking bays at walking distance from the terminal On a peak day, the 33,290 sqm terminal handles nearly 35,000 passengers and up to 215 flights

14. POLICY CHALLENGE: OVERALL AIRPORT COST A waiver in landing charges for all aircrafts with maximum certified capacity of 80 seats

15. POLICY CHALLENGE: OVERALL AIRPORT COST Airliner’s choice of aircraft size is a function of distance covered, level of demand, level of competition, and airport policies The high load factor-determinant of airline route profitability, can be achieved through service frequency or aircraft size Airliners tend to achieve the high load factor by increasing the service frequency Increase in aircraft service frequency by using very small aircrafts leads to higher airport congestion and environmental impact cost

16. OVERALL AIRPORT COST : Delhi - Mumbai Route Case-study Gas Emissions Cost Analysis during LTO Phases from Daily Operation between Delhi and Mumbai Airports across Selected Aircraft Fleet

17. OVERALL AIRPORT COST : Delhi - Mumbai Route Case-study Environment Cost-saving Comparison of Narrow Body Aircraft Models with Different Seating Configurations

18. Findings indicate that to transport the daily air traffic capacity along the studied route, the use of narrow-body aircrafts results in lesser air pollution Further, in-depth analysis across narrow body aircrafts used to serve on the same route shows: - The use of very small aircrafts with increased frequency has a higher impact on local air pollution - The environmental cost of using a very small aircraft were higher of nearly close to that of using a wide body aircraft Similar trends were also observed in the analysis of aircrafts during the climb-out and approach/arrival stages POLICY CHALLENGE: OVERALL AIRPORT COST

19. OTHER POLICY CHALLENGES

20. RECOMMENDATIONS Construct LCC terminal at existing airports Relax policy barrier that prohibit the construction of an airport within 150 km radius Relax fee waiver cap on aircrafts with less than 80 seats/or weighing less than 21 tones for LCC Launch air service to commercially non-viable routes with subsidy support Remove the five-year/20 aircrafts threshold on domestic airlines for operating regional flights Institutional funding for LCC entry