JSW Group looks to enter into civil aviation market
Steel and infrastructure conglomerate, Jindal Steel Works Group has offered bids to enter the civil aviation market, sources said on Monday.
The group participated in the auction for routes under Prime Minister Narendra Modi’s Regional Connectivity Scheme, Bloomberg quoted CFO Seshagiri Rao.
JSW did not bid under any listed entity and this move may improve connectivity between JSW group’s plants, sources said.
Shares of JSW Steel was up 0.8% on BSE Sensex at 1027 hours and climbed 1.21% at 1104 hours to trade at Rs 188.70 per share.
The company has a plant down in the northern part of Karnataka which is listed on the UNESCO World Heritage Site called – Hampi. It comprises of a village town and a temple, frequently visited by tourists.
The e-auction bid was supposed to commence in mid-October so as to ensure rolling out of the plan by January 2017.
However, experiencing delay in the plan the deadline for submitting initial proposals came to an end on January 17 and counter-bids were invited against these initial proposals and the last date of submission was February 1, 2017.
In its plan to increase air connectivity to the interior parts of the country, PM Modi along with Civil Aviation Minister, Ashok Gajapathi Raju unveiled the Regional Connectivity Scheme.
Airports Authority of India had shortlisted 22 underserved and unserved airports, which were suitable for RCS flights. These airports included Bikaner, Jaisalmer, Warangal, Bhatinda, Pathankot, Jamnagar, Gwalior, Agra and Allahabad among others.
Nearly 16 airports in southern India, 32 in western India, 21 in north, 12 in east and 11 in north-eastern regions were proposed to be connected under the RCS.
Under the scheme the government capped passenger fares for a journey of approximately 500 kms to Rs 2500 per hour.
The Central government said it will provide concessions of 2% excise on Value Added Tax (VAT) and service tax at 1/10th the rate and liberal code sharing for regional connectivity scheme airports.
In order to incentivise airlines to take part in the scheme the government introduced offers such as cancellation of landing charges and parking charges in those airports.
The airlines would be required to fly a minimum of three and a maximum seven regional connectivity scheme flights per week per route with minimum nine and maximum 40 seats per flight.