Setting up an

Aviation Park in Bagodara

Village, Gujarat

Tourism
Government of Gujarat
Contents

Project Concept 3
Market Potential 4
Growth Drivers 5
Gujarat – Competitive Advantage 6
Project Information 9
- Location/ Size
- Infrastructure Availability/ Connectivity
- Raw Material/ Manpower
- Key Players/ Machinery Suppliers
- Potential Collaboration Opportunities
- Key Considerations
Project Financials 12
Approvals & Incentives 13
Key Department Contacts 16

Page 2
Project Concept

What is an Aviation Park?

Aviation Park serves as a one-stop destination in the avenues of aerospace training, research,
recreation and manufacturing. It provides a platform for educating people about the aviation
activities. An Aviation Park can have a slew of facilities including a museum, airstrip, training school
and helipad among others. Such a park aims to raise the awareness about the potential of the
.
aviation sector among students, professionals, policy makers and business entities.

Attributes of an Aviation Park Aviation Parks and Museums

across the globe
This Space The Space gives
gives Runway Visitor Park-Manchester (Area- 10
opportunity to hectares)
opportunity to tourists to learn
live, experience and experience all
and perform the dimensions of
thrilling aviation industry, Riviera di Rimini-Italy (Area- 12 hectares)
adventures through the
fundamentals of
Edutainment
Airdrome- Netherland (Area- 8 hectares)
Experiential Dynamic Place
Place
Aviation Park, Greenville Downtown–USA
This Space gives (Area- 0.6 hectare)
exploratory access
to Aviation
National Air and Space Museum, Washington
Recreational D.C. (Area- 8 hectares)
Place

Aviation Museums in India

Naval Aviation Museum, Goa

HAL
Aerospace
Museum,
Bangalore

Page 3
Market Potential
India
Indian aviation industry

 India is among the five fastest-growing aviation markets globally and

aims to become the third-largest aviation market by 2020 and the
Expected to add
largest by 2030. 275 million new
 Airbus expects India’s aviation industry to grow at more than 10% passengers
annually
annually in the next decade, almost double the growth rate of global
aviation industry.

Airport infrastructure in India

Airport infrastructure industry value (INR billion)

271

10%
246

224

204

186

2016f 2017f 2018f 2019f 2020f

Source: Infras Sector India, Feb 2016, EMIS Database

 As most airports currently operate at near 100% utilisation, future growth in passenger traffic
would require additional airports.
 An estimated investment of INR1.9 trillion would be required for Brownfield/ Greenfield airport
construction by 2022, to ensure sufficient handling capacity.
 The government is planning to invest INR60 billion to revive and develop 75 regional airports
across the country, to improve regional and remote air connectivity. The central government
will partner with the state governments to revive these non-functional airports, at an indicative
cost of INR0.5–1 billion each.

Sources: Indian Aviation Industry report and India Infrastructure Sector report, EMIS database; Zee News website

Page 4
Market Potential
Gujarat
Rising demand for aviation parks in Gujarat

 Gujarat aims to nearly double the contribution of tourism industry to state’s

economy from 2.7% to 5% during 2014-2025, while also doubling its share in
overall foreign visitors from 2.4% to at least 5% by 2025.
 Palitana is a prominent Jain pilgrimage place, witnessing 18% annual growth
in visitors during FY13-16. Nearly 20% visitors in FY16 were from other
Expected Indian states and abroad, while 12% belonged to luxury, high and medium
increase in
tourism class highlighting potential for use of chartered aircrafts.
Tourist inflow in Palitana (In millions)
1.2 1.3
0.8 0.9

FY13 FY14 FY15 FY16

Source: Gujarat TFIS Annual Reports

 Gujarat accounts for 60% of the INR300 billion Indian ceramics industry, with
majority of units located in Morbi. The district is the second largest tile cluster
globally and generates over INR150 billion revenue annually. Key ceramic
players in Morbi include Antique Marbonite, Coral Gold Tiles, Coral Granito,
Simpolo Vitrified, Umiya Ceramic among others.
 Anti-dumping duty imposed on tiles from China and basic customs duty
Presence of on silica sand slashed from 5% to 2.5%, to boost the domestic tiles
key industry. The state government reduced VAT on ceramic products from
industrial
clusters 15% to 5%, cut gas prices and allowed industries to use coal-gassifiers.
These measures will help improve the cost competitiveness of local
ceramic industry, primarily based in Morbi.
 Gujarat is Asia’s largest producer of wall clocks and Morbi is considered as
the country’s clock hub, with nearly 150 units. Key players in Morbi’s clock
industry include Ajanta Manufacturing, Citizens Clock, Samay Quarts,
Sonera Industries among others.

 There is a need to set up airports at key industrial and pilgrimage

Improving
regional destinations like Morbi, Palitana, etc. to develop faster travel options.
connectivity  The domestic passenger traffic at airports near Morbi (Rajkot) and Palitana
among these (Bhavnagar) is estimated to grow by nearly 1.5 times (from 300k to 440k)
cities
during 2012–2020.
Sources: GIDB, Gujarat Tourism Policy 2015, Times of India website
Page 5
Growth Drivers

Macro-economic growth enablers for Aviation Industry

During 2010-2015, the India is expected to have
domestic air-passenger Increasing Surge in new
~1,800 commercial aircraft,
traffic grew at a CAGR number of air aircraft deliveries
four times the current aircraft
of 9.1% and is expected passengers
fleet by 2035. The global
to rise at similar rate till commercial aircraft deliveries
2020 driven by rising are likely to grow at a CAGR
disposable income of of 3.7% by 2025. Also, the
middle class families in domestic airline operators
India. likely to double by 2020.

The Airport Authority of The labour cost in India is

Development Cheaper labour ~20-25% cheaper (US$30-35
India (AAI) has planned to
plan for non- costs per hour) than other MRO
operationalize 24 non-
operational hubs such as Singapore and
operational airports
airports Middle-East (US$40-45 per
through a development
plan which include hour) and ~50% cheaper
Jalagaon, Akola, than other key aerospace
Cuddapah and Gondia markets such as Europe and
airports which is expected North America (US$65-70
to increase the air traffic per hour) which is expected
to drive growth in the region.

Ministry of Civil Aviation National Civil Aviation

Promotion of Favourable
will promote growth of Policy 2016 aims to
Aero Sports Government
General Aviation and promote the entire aviation
Policy
Aero-sports activities sector chain in a
with regulatory regime harmonised manner
commensurate with the covering cargo, MRO,
type of operations or general aviation,
aircraft in line with aerospace manufacturing
international best and skill development. It
practices. also aims to establish an
integrated eco-system
which will lead to
significant growth of civil
aviation sector, which in
turn would promote
tourism, increase
employment and lead to a
balanced regional growth.

Page 6
Market Potential

Tourism & Aviation Sector- Global Overview

 The travel and tourism industry is one of the world’s largest industries with a global economic
contribution (direct, indirect and induced) of almost USD 7.6 trillion in 2014. The direct economic
impact of the industry, including accommodation, transportation, entertainment and attractions,
was approximately USD 2.36 trillion that year.
 As per IATA Fact Sheet, scheduled passenger numbers have been estimated at 3568 million for
2015 as against 3328 millions in 2014.

Indian Overview
 The Indian tourism contribution to GDP No. of Domestic tourist visits (in million)
was estimated at USD 114.23 Billion
(6.7%) in 2013. (Source: Indian Tourism
Statistics at a Glance 2014) 1281.95
1145.28
 22.57 million foreign tourists visited India in 1045.05
2014 against 17.91 million in 2010. 864.53
(Source: Indian Tourism Statistics at a 747.7
Glance 2014)
 Indian domestic air traffic is expected to
cross 100 million passengers by FY2017,
compared to 81 million passengers in
2015. Aviation Sector in India has a GDP
share of 0.5% and has an employment
force of 1.7 million
2010 2011 2012 2013 2014 (P)
 India aims to become the third-largest
aviation market by 2020 and the largest by Source: Indian Tourism Statistics at a
2030. Glance 2014
Gujarat Overview
Gross Tourist flow (No. in million)  Gujarat has witnessed a growth rate of 15% CAGR
in Gross tourist flow in the last 5 years.
2014-15 32.7
 Percentage share of purpose of visit to Gujarat-
Business at 59%, Religious at 31%, Leisure at 7%
2013-14 28.8 and Others at 3%
 By 2025, Gujarat Tourism projects to contribute 5%
2012-13 25.4 to GDP, and create employment of 3 million from
2.7% and 0.95 million respectively in 2014. (Source-
2011-12 22.4 GITCO)
 Gujarat projects an investment of USD 4 Billion by
2010-11 19.8 2025 from USD 0.81 Billion in 2014. (Source-
GITCO)
2009-10 17.0  Gujarat aims to be one amongst the top five tourist
States of India in terms of local, national and
international tourist footfalls by 2025. (Source-
(Source: Tourism Corporation of Gujarat Ltd GITCO)
& Gujarat Tourism Policy (2015-2020)

Page 7
Gujarat - Competitive
Advantage

The state has 2 flight schools- the Gujarat

Flying Club and the Ahmedabad Aviation
Academy and engineering colleges that
Gujarat has a robust civil aviation offer programs in Aircraft Maintenance
infrastructure. It has 9 operational airfields Engineering.
under AAI, 3 under IAF, 2 private air ports,
2 under Union Territory and 3 under state
government. Ahmedabad is an international
airport.

Gujarat has 44 ports along a 1600 km

Gujarat is geographically well-located for coastline, over 5000 km of
flight schools and other aviation-related rail network, about 77,000 km of motorable
institutes, maintenance, repair and roads, 24 x 7 power supply and
operations (MRO) and other non-passenger favourable law-and-order situation.
aviation services.

The state has enough scope for

recreational aviation services like airports
and Micro Light Aircraft flying to become
viable.

Gujarat encourages private sector

participation for development of aviation
Infrastructure in the existing state Gujarat Tourism Policy 2015-2020 has
airport/airstrips. It has also plans for given Tourism Sector the status of an
development of green field Airport for Industry and has ensured provisions to
scheduled and non-scheduled aircraft motivate entrepreneurs engaged in setting
operation. up new infrastructure and services in this
sector.

Page 8
Gujarat - Competitive
Advantage
The Gross Tourist Flow has been increasing for Gujarat
Gujarat Gross Tourist Flow (Number in millions)
38.3
CAGR: 32.7
28.8
13.6% 25.4
22.4
19.8
15.8 17
12.3 14.1
10.7

2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16
Source: Tourist Flow Information System- Annual Report 2015-16

 Gujarat has many tourist destinations and sacred Gujarat Gross Foreign Tourist Flow
pilgrimages, which attracts both Indian and Foreign (Number in thousands)
travelers. CAGR:
16.2% 309
 The total flow of tourist is expected to record an increase
over the years. This is attributed to the growing 228 245
prominence of the state as a major business hub. Vibrant
Gujarat is a biennial investors' summit held by the
government of Gujarat in Gandhinagar, Gujarat, India. in
The event is aimed at bringing together business leaders,
investors, corporations, thought leaders, policy and
opinion makers. The Gujarat Vibrant Summit 2015
attracted 25,000 delegates from 110 countries. 2013-14 2014-15 2015-16

Total contribution to GDP Total Investment (USD Billion) Employment (in million)
CAGR:
5.76% 5.0% CAGR:
4.00 CAGR: 3.00
11.0%
2.7% 15.63%

0.81 0.95

2014 2025P 2014 2025P 2014 2025P

Source: Tourism Policy for state of Gujarat (2015-20)

 Tourism in India accounts for 7.5 per cent of the GDP and is the third largest foreign exchange
earner for the country. Gujarat is expected to contribute 5% to the total GDP by 2025. The
business is expanding both in terms of turnover and boundaries and therefore contributions
total investments by Gujarat are expected to increase. Today worldwide, one in eleven jobs may
be ascribed to the tourism industry. Gujarat is expected to generate 3 million jobs by 2025.

Page 9
Gujarat - Competitive
Advantage
Other advantages

Ease of doing business

 Only state which comply 100% with the environmental procedures. Gujarat fares
highly when it comes to setting up a business, allotment of land and obtaining a
construction permit.

Flourishing economy
 Gujarat contributes 7.2% of the Nation’s GDP and shows leadership in many areas
of manufacturing and infrastructure sectors. Gujarat’s SDP (State Domestic Product)
at current price registered a growth of 11% during the year 2014-15.

Strategic location and better infrastructure

 Located on the west coast of India, Gujarat is well connected to the major cities of
the world by air and sea routes. The state has 45 ports, 12 domestic airports and 1
international airport in addition to an extensive rail and road network.

Easy availability of raw materials

 Many key industrial clusters such as foundry & forgings, steel pipes and tubes, steel
re-rolled products and fabricated metal products are located in close vicinity of
industrial hubs such as Dholera Special Investment Region (SIR).

Favourable labour policy

 The Gujarat government has recently passed the Labour Laws Bill (December 2015),
to give an impetus to industrialization. The key reform includes a provision for out-of-
court settlement to speed up the process labour related dispute resolutions.

Better social infrastructure

 Gujarat has one of the lowest cost of living amongst the Indian states and is
relatively less congested and less polluted, offering better standards of living to the
inhabitants and providing a better environment to work.

Page 10
Project Information

About the Project

 Gujarat State Aviation Infrastructure Company
Ltd (GUJSAIL) has identified a piece of land of 93
hectares at Bagodara (strategically located
between Ahmedabad and Rajkot on the National Bagodara
Highway) for setting up the first ever Aviation Park
in India.
 The Collector, Ahmedabad has acquired the land
and has sent the recommendation to Revenue
Department. for transfer of the land in the name of
Civil Aviation Department
 The Aviation Park will be developed in Public
Private Partnership (PPP) model.

Phase-wise development

 Phase I- Aviation Museum  Phase II- Corporate Park for Aviation industry
This phase is estimated to be operational by the The focus will be on attracting national/international
end of financial year of 2016-17. industrial houses to set up their manufacturing
facilities in this park

Proposed Components
 Aero modelling  Parasailing
 Aviation Camp (Flight Simulator)  Aviation history display of all countries
 Maintenance- Traffic Controls
 Mankind history in Aviation
 3D-4D Theatrepolis
 Brief history of all airlines
 Air warfare Survival - Land water and
Adventure  Quiz Corner for students
 Futuristic Aviation Arena  Accident/incident zone
 Aircraft mechanics and Engineering  Safety awareness zone
 Workshops  Library section
 Expert Interaction Seminars  Amusement children’s park
 Engineering Display Area  Recreation room
 Aero-science  Cutting edge technology zone
 Air Traffic Control Setups  Space technology zone
 Interactive open spaces
 Aircraft Display Zones
 Auditoriums/Souvenir shops
 Aviation Expos
 Amphitheatres
 Themed Restaurants
 Air shows
 Gliding  Hotels and Conference arenas

Page 11
Project Information

Infrastructure availability

Rail Road

 Arnej (10.9 km) and Koth (16.2 km)  NH–8A, which connects Ahmedabad to
are the nearest railway stations. Rajkot, passes through Bagodara.
 Ahmadabad Jn Rail Way Station is  Road distance between Bagodara and
major railway station 67 KM near to
Ahmedabad city is 59 km.
Bagodara.

Air Port

 Ahmedabad International Airport is  Bhavnagar is the nearest sea port (105.3

km). The port is well connected with the
located at a distance of 70 kms from
State Highway and broad gauge railway
Bagodara. line.

Water Power

 Gujarat has a state-wide “water supply  Gujarat boasts of 24 hours – 3 - phase

grid” spread across 1,20,769 km that aims uninterrupted power supply
to serve 75% of Gujarat’s population

Leading Aviation component sup

suppliers

Page 12
Project Information

Estimated Manpower Requirement

Category Number of People required

Ticketing 10

Operations & Maintenance 20

Security 5
Administrative Staff 20
Technical Staff (Engineering) 15
Managerial Staff 10
Daily workers (House keeping, etc.) 60
Total 140

Potential Collaboration Opportunities

 Ahmedabad Aviation & Aeronautics Limited

Aviation Training program providers  Gujarat Flying Club, Vadodara

Aircraft manufacturers (for aircraft  Hindustan Aeronautics Limited

display in museum)

Key considerations

 Ensure low development costs to ensure profitability

 Collaborate with private players in other areas such as F&B, parking, cabs etc. to generate
additional revenue
 Price sensitivity of construction raw material
 Uninterrupted power and water supply
 Popularize presence of airfield among potential users
 Employing technically skilled staff for runway and ATC operations
 For starting aero sports there, it would need the highest skill requirements. They also have the
highest risk element and anything that goes wrong hardly gives an opportunity for corrective
action

Page 13
Project Information

*Estimated Project Cost

Development and Establishment of Aviation Park for which tentative expenditure would be as

below:-

Project specifications INR Million

Terminal Building 30-40

Aviation Gallery Display and other interactive Zone, 3 D theatre, etc. 80 – 100

Theme Park 10- 20

Development Airstrip for which tentative expenditure 50-60

Other necessary amenities related to Aviation and Aerospace 5

Total 175 - 220

 *Disclaimer: The Project will be carried out in a PPP Model. The data for Project Financials has
been shared by the officials from the respective authority of GUJSAIL and is in tentative state

Page 14
Approvals / Incentives

Approvals Required
Approvals/clearance required Department to be approached and consulted

Registration/Industrial license Secretariat if industrial assistance (SIA) for large and

medium scale industries
No objection certificate (NOC) under State pollution control board
air and water pollution control acts
Approval of construction and country  Town and country planning
planning  Municipal and local authorities
 Pollution control board
 Electricity board
Registration under state sales tax act  Sales tax department
and Central and State excise act  Central and state excise department
Environmental clearance Ministry of environment, forest and climate change after
conducting environment impact assessment (EIA) for any
project
Hazardous waste import and export Ministry of environment, forest and climate change
approval
Power Requirement Gujarat Urja Vikas Nigam Ltd
Licenses of Training Institutes & Pilots  Directorate General of Civil Aviation
 Ministry of Defence

Incentives from Government of Gujarat

 Government of Gujarat has granted Industry status to Tourism sector thereby providing a great
boost to the industry. The incentives under Tourism Policy for the State of Gujarat (2015-2020)
shall be applicable to the eligible tourism units as mentioned in the next sections.

Capital Subsidy to the Eligible Tourism Units

Eligible Capital Investment (excluding land cost) Admissible Maximum Limit
Subsidy (INR crores)
Investment upto INR.50 crore 15% 7.5
Investment above INR. 50 crore 15% 10

Page 15
Approvals / Incentives

Incentives from Government of Gujarat

Special Package for Mega Tourism Units
The State Government shall duly promote and facilitate Mega Tourism Projects that have a large
multiplier effect on the economy, leading to employment generation and inclusive growth in the
State. Any type of Mega Tourism Units like Film City, theme parks, amusement parks, water parks,
etc. meeting the qualifying criteria of Mega Tourism Units will be eligible.
Following incentives would be offered to eligible Mega Tourism Units:
 100% reimbursement of stamp duty and registration fee on sale/lease/transfer of land for the
first transaction only. Reimbursement of stamp duty and registration fee would be done after
the commencement of commercial operations.
 Capital subsidy of 15% of eligible capital investment (excluding the cost of the land) subject to
a ceiling of INR200 million.
 Exemption from luxury and entertainment tax for a period of seven years from the date of
commencement of commercial operations.
 Exemption in electricity duty would be for a period of five years from the date of
commencement of commercial operations.
 Mega tourism units shall not be entitled to any interest subsidy.

Additional Capital Subsidy of 5% for New Tourism Units

• Owned and managed by women entrepreneurs (with minimum equity participation of 51% in
the entity)
• SC/ST categories to an additional 5% subsidy over and above the ‘Admissible Subsidy’.

Support for Sustainable Tourism -

• Assistance to eligible tourism units up to 75% of the cost of carrying out Energy Audit by a
recognized institution/consultant, Water Harvesting / Conservation and Environment-friendly
practices like Green Buildings, Solar and other Renewable Energy measures

Other Exemptions
• Entertainment Tax - 5 years from the date of commencement of commercial operation
• Electricity Duty - 5 years from the date of commencement of commercial operation for New
Tourism Units only.

Incentives under Gujarat Aerospace and Defence manufacturing

policy - 2016
 The Government of Gujarat drafted an Aerospace and Defence (A&D) manufacturing policy
2016 with an objective to establish the state as India’s hub for A&D manufacturing through
attracting 10% of the country’s A&D industry orders and creating more than 20,000 direct or
indirect jobs in the sector by 2021.

Page 16
Approvals / Incentives

Incentives under Gujarat A&D manufacturing policy - 2016

Venture capital support and interest subsidy

 If required, the state government can participate in the equity of A&D units, for up to 11%
stake subject to a limit of INR 10 crore for Mega, INR 5 crore for Large and INR 1 crore for
SME A&D units.
 The A&D units are also eligible to apply for External Commercial Borrowings at 50% of the
current ECB rate of interest subject to a maximum of 2% for 5 years. Mega A&D facilities
have a limit of INR10 crore, large INR5 crore and SME have a limit of INR1 crore.

Skill Development
 A&D companies will be provided 75% capital subsidy subjected to a limit of INR 10 crore for
setting up training institutes in the state to train in the A&D industry.
 The state government will also sponsor in-house training for first five years to companies for
setting up an A&D manufacturing facility in Gujarat.
 The Government will also develop state-level institutes for developing new training courses
and benchmarking existing courses against international curriculum.

Land
 Mega and Large A&D units (with an investment of INR 2 billion) would be given preference
for government land allotment. If required, the state government will also facilitate acquisition
of private land.
 The Government land will be allotted at 50% of the Jantri (government) rate or price fixed by
land price committee – whichever is lower. The leased land can be sub-leased further and
can be mortgaged for raising funds. Also, all the registration fee and stamp duty charges paid
during purchase or lease will be fully reimbursed.

Tax reimbursement and electricity duty exemption

 All units will be allowed reimbursement to the extent of 100% of the net value-added tax
(VAT) paid and central sales tax. The reimbursement will be applicable for 10 years for Mega,
7 years for Large and 5 years for SME A&D units.
 Further, A&D units will be provided 100% exemption on electricity duty for a period of five
years and 50% reimbursement for subsequent five years.

Page 17
 Gujarat State Aviation Infrastructure Company Limited (GUJSAIL)

https://gujsail.gujarat.gov.in/

Tourism Corporation of Gujarat Ltd

www.gujarattourism.com/

Industries and Mines Department, Gujarat

www.imd-gujarat.gov.in/

iNDEXTb - Industrial Extension Bureau

www.indextb.com

This project profile is based on preliminary study to facilitate prospective entrepreneurs to assess a prima facie scope.
It is, however, advisable to get a detailed feasibility study prepared before taking a final investment decision.

Near Torrent Sub Station, SVIP Airport,

Ahmedabad - 380 004
Phone: 91-079-22882000
Email: ceo@gujsail.org