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By:

Quaid Najmi

4 January 2025 at 8:56:24 pm

Cap air travel ‘CF’ upto one pc

AI generated image Mumbai/Nagpur: A consumer rights panel has sought urgent intervention by the government to a ‘systematic exploitation of fliers by a cartel’ comprising commercial airlines and online travel portals through arbitrary and exorbitant ‘Convenience Fees’ (CF) – estimated at a staggering Rs. 14,000-cr per year - and demanding a cap of 1-pc. A representation has been sent to Prime Minister Narendra Modi, Minister for Civil Aviation (MoCA) K. Rammohan Naidu, besides heads of the...

Cap air travel ‘CF’ upto one pc

AI generated image Mumbai/Nagpur: A consumer rights panel has sought urgent intervention by the government to a ‘systematic exploitation of fliers by a cartel’ comprising commercial airlines and online travel portals through arbitrary and exorbitant ‘Convenience Fees’ (CF) – estimated at a staggering Rs. 14,000-cr per year - and demanding a cap of 1-pc. A representation has been sent to Prime Minister Narendra Modi, Minister for Civil Aviation (MoCA) K. Rammohan Naidu, besides heads of the Central Consumer Protection Authority (CCPA) and Competition Commission of India (CCI), and officials of all concerned departments, Council for Protection of Rights (CPR)-Nagpur President Barr. Vinod Tiwari on the issue. The CPR has claimed that all commercial carriers and top online travel agencies (OTAs) like MakeMyTrip, ClearTrip, EaseMyTrip, GoIbibo plus others were charging exorbitant, unnecessary and non-refundable ‘CFs’ that has no bearing on the actual cost of digital processing of the tickets. “It appears that the airlines and OTAs operate virtually as a ‘cartel’ to fleece the air passengers. The CFs range from Rs 350-Rs 600 per flier per sector, though some smaller individual portals levy a flat rate of around Rs 300-400, regardless of the ticket prices. We want the Centre’s intervention and an investigation by the CCI into this suspected collusion,” Tiwari told ‘The Perfect Voice’. These gross CFs have become a mandatory component of the air ticket “rather than payment of an optional service”. In Jan. 2026, the CCPA barred all restaurants in the country from levying a separate ‘Service Charge’ on the final food bills following a Delhi High Court ruling, then under what rules can airlines-OTAs levy the mandatory CF, demanded Tiwari. The CPR chief said that airlines already recover infrastructure and operational costs through the base fares and fuel surcharges, making the additional Internet-handling or Web check-in related charges irrelevant and dubious. Accusing the of ‘drip pricing’, he said the CF charges are suppressed in the initial fare displayed on the screens, but pop up only at the final payment stage, “practically ‘trapping’ the consumers and ultimately forcing them to pay up”. Tiwari’s representation has proposed a 0.5-1.0 pc ceiling on the CF, irrespective of the ticket price, a full audit of the huge revenues reportedly generated by the airlines-OTAs vide the CFs, and a refund of half the CFs collected in case of cancellations. “This will prevent exploitation of the fliers, restrict the airlines-OTAs from milking routine digital payments as high-margin revenue sources, often 15pc-20 pc of the ticket costs, and lead to fair competition among all the stakeholders,” suggested Tiwari. This 0.5-1.0 pc limit would additionally benefit the air passengers by making flying somewhat cheaper as envisioned by the PM, reduce the burden on low-cost, short-hop travelers, the budget-conscious holiday crowds, or the growing tribe of ‘frequent fliers’ in the country while actually boosting the turbulent aviation sector, Tiwari contended.

Indian Shipbuilding A Must Win Marathon

Shipbuilding

With a coastline of 7500 KM, it is hard to imagine, that for the first 20 years (1947-1967) India had no ‘shipping ministry’. In 1967 a Shipping ministry “coupled” with ROAD transport was established. Since then, this ministry has been on a name changing ride, not once, not twice but six times. In 2009 the “ROAD Transport and Highways” was de-coupled and ‘Shipping’ ministry was formed. Turning point came in 2015 with a clear maritime vision for 2030 and 2047. Ministry was re-christened, aptly to Ministry of “Ports, Shipping and Waterways” in 2020.


Why is Shipbuilding important for a country?

a. A Shipyard becomes an opportunity hub and like a queen bee requires the support of an industrial colony to manufacture machinery and equipment.

b. National Shipyards support fleet renewal needs of the Navy.

c. Contributes to national GDP, increases inflow of FOREX.


Korea shipbuilding is 8% of GDP. Japan’s automobile industry is 2.9% of GDP. India’s shipbuilding a meagre 0.000578% of GDP. In context, India’s pharmaceutical industry, ranked third largest in the world is 1.72% of India’s GDP.


International Shipbuilding Market

The market is estimated to reach around USD 200 billion by 2029, growing at a CAGR of 4.84%. While India is at bottom with 0.07% of world share, behind Philippines 1.5% and Vietnam 1%, however on the positive side, India has done well in taking care of its defence needs, with 37 of 39 Naval ships being built in India yards. Rear Admiral S Shrikhande researching on maritime as a Fellow at Wollongong University, Australia, says “Shipbuilding in India needs both, serious incentivisation and dogged determination and not harping on being a big ship breaking country. That Garden Reach shipyard has a $54 million order for merchant ships from a German owner, is a good sign.”


Were Shipyards of 20th century in Flight mode?

Prominent shipyards in India were built in the colonial period. Mazagon Dock 1774, Garden reach 1884, Hindustan shipyard 1941 to cater to British navy and merchant fleet needs. Cochin shipyard 1972, Adani Katupalli 2013, Reliance Naval and Engineering, Rajula Gujarat 1997 and others have limited capacity, hence a lot more work to do. Capt. Subhangshu Dutt (Singapore) a mariner and now a shipowner, says “GOI should hold hands in any collaboration till the marriage with the foreign entity is reasonably stable. He also suggests that “new shipbuilding sites should be given to existing successful shipyards since they have decades of experience and talent. Consortium of 3 or more parties may also be good idea”.


Shipbuilding GOLD

As per SPLASH report the demand for LCO2 carriers could reach 2,500 ships by 2050. As per other estimates, 40% of global fleet of ships could have wind propulsion by 2050. A surge in such vessels is due to an unparallel waves of decarbonization in the shipping industry. Demand for ships with ‘carbon neutral’ badges, such as Dual fuel, Wind assisted, Nuclear fuel ships, Hydrogen powered ships, Liquified CO2 (LCO2) carrier, is outstripping supply. A must in the ‘bucket list’ of every Shipyard. Pinning down a standard ROI in shipbuilding is not easy, but experts suggest it could range from 4% to 15% for the high demand ‘carbon neutral’ ships. While an LNG new build vessel could cost US$ 250 million upwards.


International collaboration

On China’s shipbuilding success story, Manoj Pandalanghat (Singapore) a mariner and ship owner believes that “China has around 50 active Shipyards. Each have a few large dry docks. In each dock two or more large vessels are built simultaneously. Thus, a single yard is able to roll out 2/3 vessels/month, 36 vessels/year and 50 shipyards roll out 1800 vessels/year”.


China could be a jaldi-5, but India needs a sturdy Mount Fiji. Besides technology, Japanese bring the most important hand baggage of soft-skills and culture, essential for success from keel laying to delivery. Maruti’s is a standing example.


Food for thought for New Delhi

a. Expertise: Hire Naval Architects and shipbuilding experts with current international experience.

b. Government assistance: Land, Financial support, subsidies and timebound clearances.

c. Monitoring: PMO should monitor the first 5 to 10 years till Shipbuilding takes-off on this long-haul flight to destination 2047.


India’s Shipbuilding is expected to grow to $237 billion by year 2047. On a back of the envelope calculations this works out to about 4% of India’s 2047 projected GDP of $ 5 trillion. While cars are driven on roads, however the Ministry of roads and transport has little to do with “Automobile manufacturing”. On a similar note, ‘Shipbuilding’ as an industry has little to do with Ports, Shipping and Waterways, thus it may be worthwhile to consider a separate ‘Ship-building’ wing in the Ministry of Ports, Shipping and Waterways headed by a dynamic cabinet rank minister. Since 2047 targets are stiff and an uphill task, so in all probabilities, the officials in Ministry of Ports, Shipping and Waterways are likely to push beneath the carpet, delays and failures of Shipbuilding with sweet success stories of “Ports, Shipping and Waterways” and if this does happen then India will not only miss the Shipbuilding bus of 21st century but a lot more from a national security and strategic perspective.


(The author is a Shipping and Marine consultant. Member Singapore Shipping Association and empaneled with IMO as a specialist consultant. Views personal.)

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