Financial Daily from THE HINDU group of publications
Monday, Jan 31, 2005
Industry & Economy - Exports & Imports
Kerala air cargo agents weighed down by low capacity on AI Express
V. Sajeev Kumar
In a memorandum to the Union Civil Aviation Minister, the Air Cargo Agents Association of India pointed out that the export operations from Kerala, especially to Dubai, which almost wholly depends on AI, would be affected from the three airports of Kochi, Kozhikode and Thiruvananthapuram. Air India is the dominant player ferrying almost 65 per cent of the total air exports from the region.
According to Mr Ramnath Raghavan, Chairman of the Association's Kerala Region, over 80 exporters and 20 air cargo agents are involved in the export operations in the State, fetching foreign exchange earnings worth $100 million.
Starting with 250 kg a day in 1979, export air cargo accounts for over 70 tonnes now, comprising mainly fresh vegetables, fruits, foodstuff, and marine products. Kerala's annual air exports of fruits and vegetables exceed 35,000 tonnes, of which Thiruvananthapuram alone accounts for almost 23,000 tonnes. Some of the exporters use Kozhikode and Kochi as they are unable to get their entire cargo space requirement from Thiruvananthapuram.
The memorandum said that Thiruvananthapuram was the third biggest cargo revenue earning station for Air India after Mumbai and Delhi. Of the total revenues of Rs 80 crore generated from Air India-Thiruvananthapuram last year, Rs 25 crore came from cargo. The Association clarified that it was not against the introduction of the budget airlines as there had been a persistent demand for one from Keralites working in the Gulf.
However, the cargo fraternity was concerned about the choice of aircraft.
He said that the airline has opted for Boeing 737-800, which is a narrow-bodied single aisle aircraft with very limited cargo carrying capacity.
This aircraft can carry a mere 1000 kg against the 12000-14000 kg hauled by the Airbus 310 that Air India now uses on the Gulf sector. Airbus 310 is also fully equipped for cargo with facilities to accommodate containers and pallets.
The Boeing 737 had no such facilities and the cargo has to be bulk loaded, Mr Ramnath Raghavan said.
The Association feared that Air India would increasingly use its low-cost carrier for the Gulf operations. This would reduce the cargo capacity to 7,000 kg a week, from the 100,000 kg Air India, as the only airline with a daily direct service to Dubai, now carries.
Air India, Mr Ramnath Raghavan said, had announced plans to progressively reduce cargo capacity available for perishable exports to the Gulf and West Asia December 16, 2004.
As per the plan, there would be a progressive reduction in the allocation of space for perishables from Thiruvananthapuram to Dubai, Abu Dhabi and Muscat. It is learnt that similar plans are being introduced in Kozhikode and Kochi, he added.
Recalling the commencement of air exports from Thiruvananthapuram 25 years ago, Mr Raghavan pointed out that, in those days, entrepreneurs were encouraged by Air India to export to utilise the cargo capacity available on these flights.
The airline had also increased its frequency and added destinations by increasing the cargo capacity over time.
The frequency of flights had also increased after Thiruvananthapuram was declared an international airport. Other airlines had also started operations and the air exports had picked up considerably.
The Association said that Air India's decision to induct narrow-bodied aircraft for low-cost operation could affect, if not stop, exports and financially ruin farmers.
The Association has urged the Minister to intervene and direct Air India to constitute consultative committees in each region, comprising representatives of the Cargo Agents Association, Shippers Associations and other users' organisations to make sure that their requirements are met.
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