chapter-xi page 1 of 49 - rajya sabha

CHAPTER-XI

COMMITTEE ON TRANSPORT, TOURISM AND CULTURE I. Composition of the Committee 11. The Department-related Parliamentary Standing Committee on Transport, Tourism and Culture was constituted on5th August, 2005 and continued upto the 4th August, 2006. The Committee was again reconstituted on 5th August, 2006. The total number of the Members of the Committee was 31 out of which 10 Members were from Rajya Sabha and 21 Membersfrom Lok Sabha. 11.2 The Committee consisted of following Members: —

COMMITTEE ON TRANSPORT, TOURISM AND CULTURE (As on 5.8.2005)

1. Shri Nilotpal Basu — Chairman

RAJYA SABHA 2. Shri Kamal Akhtar 3. Prof. Ram Deo Bhandary 4. Shri S.S. Chandran 5. Shrimati Hema Malini 6. Shri Janardhana Poojary 7. Shri Satish Kumar Sharma 8. Shri Shatrughan Sinha 9. Shri Rama Muni Reddy Sirigireddy 10. Shrimati Ambika Soni

LOK SABHA 11. Shri Ramdas Athawale 12. Shri Raj Babbar 13. Shri Anil Basu 14. Shri Sartaj Singh Chhatwal 15. Shri N.S.V. Chitthan 16. Shri Adhir Chowdhury 17. Dr. K. Dhanaraju 18. Shri Ravindra Naik Dharavath 19. Shri Dip Gogoi 20. Shri Vijay Kumar Khandelwal 21. Shri W. Wangyuh Konyak 22. Dr. Ramkrishna Kusmaria 23. Shri Samik Lahiri 24. Shri Sudam Marandi 25. Shri Alok Kumar Mehta 26. Shri Gingee N. Ramachandran 27. Shri Manabendra Shah 28. Shri Dushyant Singh 29. Shri Madan Lal Sharma 30. Shri Chengara Surendran 31. Shri Umakant Yadav

COMMITTEE ON TRANSPORT, TOURISM AND CULTURE

(As on 5.8.2006)

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10/3/2008http://10.21.217.2/committeessum/2006/chapter_11.htm

*1. Shri Sitaram Yechury - Chairman

RAJYA SABHA 2. Shri Kamal Akhtar 3. Prof. Ram Deo Bhandary 4. Shri S.S. Chandran 5. Shrimati Hema Malini 6. Shri Janardhana Poojary 7. Shri Satish Kumar Sharma 8. Shri Shatrughan Sinha °9. Shri M.V. Mysura Reddy

10. ×

Shri Janardan Dwivedi

LOK SABHA

11. Shri Ramdas Athawale 12. Shri Raj Babbar 13. Shri Sartaj Singh Chhatwal 14. Shri N.S.V. Chitthan 15. Shri Adhir Chowdhury 16. Dr. K. Dhanaraju 17. Shri Ravindra Naik Dharavath 18. Shri Dip Gogoi 19. Shri Vijay Kumar Khandelwal 20. Shri W. Wangyuh Konyak 21. Dr. Ramkrishna Kusmaria 22. Shri Samik Lahiri 23. Shri Sudam Marandi 24. Shri Alok Kumar Mehta 25. Shri Gingee N. Ramachandran 26. *Shri Prahlad Joshi 27. Shri Dushyant Singh 28. Shri Madan Lal Sharma 29. Shri Chengara Surendran 30. Shri Umakant Yadav 31. Shri Suraj Singh

II. Subjects selected for examination 11.3 The Department-related Parliamentary Standing Committee on Transport, Tourism and Culture selected thefollowing two new subjects for examination:—

Besides this, the following Bills were considered by the Committee which were referred to the Committee by Hon'bleChairman, Rajya Sabha/Hon'ble Speaker, Lok Sabha for examination and report:

Sl. No.

Ministry/Deptt. Subjects

1. Ministry of Civil Aviation “Air safety and related issues”

Sl. No.

Date of reference Name of the Bill

1. 27.5.2005 The Admiralty Bill, 20052. 13.12.2005 The Inland Vessels (Amendment) Bill, 20053. 14.12.2005 The Carriage By Road Bill, 2005

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III. Review of work done (a) Sittings of the Committee 11.4 During the year the Committee held 17 sittings for 31 hours and 05 minutes. A Statement showing the dates of sittings of the Committee held during the period under Review, the duration of the sittings and the subjects discussed aregiven in Annexure-XI. (b) Study visits 11.5 The Committee undertook one study visit for a total number of seven (7) days. Officers/staff of the Secretariat accompanied them. The section also prepared study notes after the Committee visit. The details of the visit are given below: -

IV. Reports presented 11.6 During the year under review, Seventeen (17) Reports of the Committee were presented to both the Houses of Parliament as detailed below:-

Destination Date Organisation Examined

Subject

Goa, Kochi and Lakshadweep

5.11.2006 to 11.11.2006

Mormugao Port Trust Cargo Handling at Mormugao Port, Development of Tourism in Goa

Tour/Travel/Hoteliers Associations, Department of Tourism, Government of India and Government of Goa

Development of Tourism in Goa

Cochin Port Trust, Shipping Corporation of India, Dredging Corporation of India and Cochin Shipyard Ltd.

Functioning of the Cochin Port Trust, Shipping Corporation of India, Dredging Corporation of India and Cochin Shipyard Ltd.

Air India, Indian Airlines and Ministry of Civil Aviation

International Air Connectivity to and from Kochi Airport, Kochi to Middle East and Gulf countries

Shipping Corporation of India, Andaman and Lakshadweep Harbour Works

Passenger-cum-Cargo services from Mainland to Lakshadweep Islands, Development of Tourism in Lakshadweep.

Report No. Title of the Report Date of Adoption Date of Presentation

92nd Action Taken by the Government on the Recommendations/Observations of the Committee contained in its Eighty-Fourth Report on Demands for Grants (2005-2006) of Department of Road Transport and Highways

22.2.2006 27.2.2006

93rd Action Taken by the Government on the Recommendations/Observations of the Committee contained in its Eighty-Fifth Report on Demands for Grants (2005-2006) of Ministry of Culture

22.2.2006 27.2.2006

94th Action Taken by the Government on the Recommendations/Observations of the

22.2.2006 27.2.2006

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V. Summary of Recommendations

(a) 92nd Report (ATR on observations/recommendations of the Committee contained in its 84th Report on Demands for Grants (2005-06) of the Department of Road Transport and Highways) National Highways not covered under NHDP: 11.7 The Committee noted the reply of the Department and expected that Special Accelerated Road Development Programme (SARDP) would be implemented at the earliest. The Committee was also of the view that the Department shouldexpedite all the background work for the ensuing projects based on the experience gained by it while implementing theGolden Quadrilateral Project.

Committee contained in its Eighty-Sixth Report on Demands for Grants (2005-2006) of Department of Shipping

95th Action Taken by the Government on the Recommendations/Observations of the Committee contained in its Eighty-Seventh Report on Demands for Grants (2005-2006) of Ministry of Tourism

22.2.2006 27.2.2006

96th Action Taken by the Government on the Recommendations/Observations of the Committee contained in its Eighty-Eighth Report on Demands for Grants (2005-2006) of Ministry of Civil Aviation

22.2.2006 27.2.2006

97th Action Taken by the Government on the Recommendations/Observations of the Committee contained in its Ninetieth Report on the ‘Development of Airport Sector with special emphasis on new modern airports’

22.2.2006 27.2.2006

98th Action Taken by the Government on the Recommendations/Observations of the Committee contained in its Eighty-third Report on ‘Functioning of the Commission of Railway Safety’

17.3.2006 21.3.2006

99th The Admiralty Bill, 2005 (With evidence)

17.3.2006 21.3.2006

100th The Inland Vessels (Amendment) Bill, 2005(With evidence)

17.3.2006 21.3.2006

101st The Carriage By Road Bill, 2005(With evidence)

17.3.2006 21.3.2006

102nd Demands for Grants (2006-2007) of Department of Road, Transport and Highways

19.5.2006 22.5.2006

103rd Demands for Grants (2006-2007) of Department of Culture

19.5.2006 22.5.2006

104th Demands for Grants (2006-2007) of Department of Tourism

19.5.2006 22.5.2006

105th Demands for Grants (2006-2007) of Department of Shipping

19.5.2006 22.5.2006

106th Demands for Grants (2006-2007) of Ministry of Civil Aviation

19.5.2006 22.5.2006

107th Action Taken by the Government on the Recommendations/Observations of the Committee contained in its Ninety-first Report on ‘Functioning of the Archaeological Survey of India’

19.5.2006 22.5.2006

108th Functioning and performance of India Tourism Development Corporation Limited

12.12.2006 15.12.2006

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Development of National Highways in North- Eastern region 11.8 The Committee desired that the substantially higher allocation for the development of Central Sector Roads in 2005-06 as compared to 2004-05 would actually translate to better condition of roads in the North-Eastern Region. Further, the Committee recommended that the Special Accelerated Road Development Programme (SARDP) should be implementedat the earliest in the North-Eastern Region. Participation of private sector in development and maintenance of National Highways 11.9 The Department had not specified the efforts contemplated by it to maximize private investment in the North-Eastern Region. The Committee, therefore, reiterated its apprehension on the success of private sector participation in theRoad Sector in the North-Eastern Region.

Need for an Integrated Transport Policy 11.10 The Committee recommended that it should be appraised about the follow-up action on the Draft National Road Transport Policy and to incorporate the same in the Integrated Transport Policy of the Government. Damage in Tsumani hit areas 11.11 The Committee strongly recommended that the Department should closely monitor the utilization of fundsallocated to the States for the restoration/repair of the National Highways in the Tsunami hit areas and also ensure earlycompletion of the work.

Differential pricing system for private vehicles 11.12 The Committee was of the opinion that its recommendation should be incorporated in the National Road Transport Policy so as to have a binding effect on the States/UTs. Use of Research and Development and Information Technology 11.13 The Committee took note of the fact that the Department of Road Transport and Highways was not having any member in the Governing Council of the Automotive Research Association of India (ARAI), Pune, which was anindependent entity and that the Department of Heavy Industry was the nodal agency of Central Government for dealing withthat institution. The Committee found it surprising that although the Department of Road Transport and Highways wasresponsible for the working of the Motor Vehicles Act, 1988 and Central Motor Vehicles Rules (CMVR), 1989, it had noadministrative control over the agency authorized to test the vehicles and give type approval certificate as to the complianceof the provisions of Motor Vehicles Act, 1988 and Rules thereunder. The Committee, therefore, reiterated its recommendation that either the Department of Road Transport and Highways should have control on the AutomotiveResearch Association of India, Pune or the Association should be divested of the power of fixing emission norms as apexcertification agency. 11.14 The Committee noted from the reply that the allocations for research and development had been substantiallyscaled down from Rs.7.9 crore during 2004-05 to Rs.4.85 crore in the current Financial Year 2005-06. Apparently, the abysmally poor utilization of the allocated funds in the previous year was the reason for steep scaling down of the outlay. Further, the present programmes for R & D are scattered among various organisations and therefore the Committee reiteratedits earlier recommendations made in this context that the Department of Road Transport and Highways should develop aninstitutional mechanism to undertake research and development activities. (b) 93rd Report (ATR on observations/recommendations of the Committee contained in its 85th Report on Demands for Grants (2005-2006) of the Department of Culture) The approach in the Tenth Plan and analysis of the Annual Plan 2005-2006 11.15 The Committee noted the reply of the Ministry and observed that the Ministry should review the whole planning and budgetary process while keeping in mind the long-term policy perspective so that any reduction at R.E. stage can beavoided. The Committee hoped that fixing quarterly monitoring targets will ensure the timely and better utilization of funds. 11.16 The Committee noted the reply of the Ministry and hoped that periodic review of the identified programmes are

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carried out at the apex level and status/progress report prepared by the National Committee on completion of Multi-Purpose Cultural Complex projects are also furnished to this Committee. Non-writing/publication of excavation reports 11.17 The Committee noted the reply of the Ministry and observed that since long the publication of excavation reports had been continuing and the Committee had expressed its apprehensions on its timely completion. However, since the Ministry had now come-up with a time-frame, the Committee directed that writing and publication of all pending reports within the specified time-frame should take place. The Committee directed the Ministry to appraise the latest position in this regard. Merger of National Mission on Antiquities and National Mission on Built Heritage 11.18 The Committee did not accept the reply of the Ministry and noted that it was only the repetition of their earlier stand. In this context Committee reiterated its recommendation that "on the one hand the Ministry had stated that they are not recruiting more staff. On the other hand the Committee had been informed that for the Mission purpose the Ministry will be contractualising jobs on short-term basis. In view of this the Committee directed that the Ministry should adopt a clear-cut guideline in this regard and the ASI should be provided with appropriate wherewithal so that laudable goals of these Missionsdo not remain unachieved. Problem of encroachment and security of monuments/sites under the protection of ASI 11.19 The Committee noted the reply of the Ministry. The Committee expressed its deep anguish that despite the matter taken up at the highest level, no significant progress had been made in the matter of bearings of expenditure on CISF engagedin the protection of monuments. The Committee reiterated its recommendation that the matter may be taken up with theMinistry of Home Affairs besides the Chief Secretaries of all the State Government on priority basis. (Para 33)

National Archives of India 11.20 The Committee was not convinced with the manner in which the Government had taken the recommendation of the Committee. This shows lacking of seriousness on the Ministry's part. The Ministry could have supplemented information contained in the reply, which was sent only on 26th August, 2005. The Committee would like to have the latest development in the matter and desired that the appointment of a full-time Director General of Archives would improve upon the functioning of this apex institution in the country. 11.21 The Committee noted the reply of the Ministry and insisted that in order to achieve the desired objective a periodic monitoring of the expenditure should be initiated. Library Sector 11.22 The Committee took a serious note of the reply that due to technical, managerial and procedural problems, functioning of Delhi Public Library had been hampered. The Committee hoped that the Ministry would evolve a proper procedure regarding the purchase of books. Science Cities 11.23 The Committee noted the reply of the Ministry. However, the Committee should also be apprised about the details of the modified guidelines and the recommendations of the Review Committee, which had been constituted to makenecessary changes for the Science Cities scheme.

(c) 94th Report (ATR on observations/recommendations of the Committee contained in its 86th Report on Demands for Grants (2005-2006) of the Department of Shipping) Analysis of Annual Plan 2005-06 11.24 The Committee desired that the Department of Shipping should adhere to its recommendations and efficientlymaintain its fiscal management in future. Port Sector

11.25 The Committee noted the reply and expected that the mechanism evolved by the Department of Shipping remains

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fool-proof and problems of fiscal management would not be encountered in future.

Calcutta Dock Labour Board 11.26 The Committee was constrained to note that till date Government have not decided to settle the retirement dues ofthe employees of CDLB. Regarding introduction of Voluntary Retirements Scheme, the Committee was of the view that the Department of Shipping should strongly pursue the matter with the Cabinet and in the meanwhile, the advice of the Ministryof Law and Justice should be sought to resolve the issue.

Misappropriation of Seamen’s Provident Fund 11.27 The Committee was perturbed to note that previously also the Department of Shipping had submitted that the Cabinet Note was under finalization and no progress seems to be made in this context thereafter. The Committee had not been apprised of the status of its recommendation about approaching the Ministry of Finance for grants-in-aid to recoup the shortage in the Seamen's Provident Fund. Misappropriation of Seamen’s Provident Fund

11.28 The Committee noted the measures being taken by the Government to avert future swindling of funds. However, it suggested that the amount recovered from the persons involved should be directly deposited in the Seamen's Provident Fund.

Indian Institute of Maritime Studies (IIMS) 11.29 The Committee noted the reply and expected that the assurance given to the Committee will be strictly observedafter establishment of Indian Maritime University.

Central Inland Water Transport Corporation 11.30 The Committee emphasized that the future of Inland Water Transport Operations including that of Central WaterTransport Corporation Ltd. was very bright in this country. This area remains largely unexplored today. Therefore, the Committee further recommended the Department of Shipping to take steps to augment the infrastructure and to improve theperformance of the CIWTC and impress upon Board for Reconstruction of Public Sector Enterprises to that effect. Inland water transport 11.31 The Committee expressed its strong dissatisfaction over the fact that the Department in response to itsrecommendation had given only the time frame for various schemes/projects whereas the actual physical achievements anddifficulties have not been given. The Committee recommended that the Department should come back to the Committeewith a detailed reply with regard to integrated transport policy and modal mix of transport in the country. (d) 95th Report (ATR on observations/recommendations of the Committee contained in its 87th Report on Demands for Grants (2005-2006) of the Department of Tourism) Approach in the Tenth Plan and analysis of the Annual Plan 2005-2006 11.32 The Committee was aware of the fact that the Ministry of Finance and Planning Commission are the final authorities for the allocation of funds in the Annual Plans of the Ministry. However, the Committee recommended that the attention of the Planning Commission and the Ministry of Finance may be invited to the observations made by Committee forallocation of Budgetary support as per actual requirement and projected plans. Their response may be submitted to the Committee for its consideration. 11.33 The Committee reiterated its observations to the Ministry of Tourism to adopt a proactive approach to remove thebottlenecks, which are the root-causes for delay. The fact that the Ministry, at the threshold of Eleventh Plan was still carrying the backlog of eighth and ninth Plan’s incomplete projects speaks volumes about its inadequacies. Rural Tourism 11.34 The Committee noted with appreciation the initiatives taken by the Government in the matter. The Committee

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should also be apprised of the achievements of the Government in a detailed manner. Human Resource Development 11.35 The Ministry of Tourism had not replied on the Committee's recommendation that a statutory status be granted to National Council for Tourism and Hospitality Education (NCHM & CT). The Committee again reiterated that the status of ‘Deemed University’ may be accorded to NCHM & CT at the earliest so that it can effectively monitor and coordinate educational institutions of tourism sector which are opening up to meet the growing demand of trained manpower in the field. Uniformity and rationalisation of taxes on transport and hospitality sector 11.36 The Committee appreciated the efforts being made by the Government to rationalize the tax structure concerningthe different departments of tourism sector. However, it suggested them to strive to evolve consensus on the subject. Domestic tourism and publicity 11.37 The Committee noted the extraneous factors hindering the growth of tourism in the country as detailed by theMinistry. The Committee felt that the Incredible India campaign aimed at promoting India as a global tourist destination and there was no specific slogan or initiative to boost domestic tourism. Therefore, the Committee recommended that a concreteplan be chalked out for domestic tourists taking into account their problems and affordability. Overseas promotion and marketing 11.38 The Committee noted the reply of the Ministry. However, the Committee failed to understand the compulsions of the Ministry for which Rs. 13 crore was re-appropriated to the Domestic Promotion and Publicity Head for undertaking Domestic Promotion campaigns whereas, it was originally allocated for Overseas Promotion and Publicity during the year2004-05.

National Tourism Promotion Board 11.39 The Committee agreed with the Ministry that setting up of the National Tourism Promotion Board, which would amalgamate the various aspects/departments, was a Herculean task. But the establishment of an autonomous institution like this was all the more important for this precise reason. As regards the synergising/coordination of the various departmentsand administrative nitty-gritty was concerned, studies should be made on the basis of model countries that have already formed Tourism Promotion Board. Further, the Committee recommended that participation of the private sector should beelicited by taking up the matter at the forums like Chamber of Commerce & Industry, FICCI, Tourist Associations, etc.

Health Tourism 11.40 The Committee recommended the Ministry of Tourism to take up the matter with the various organisations likeConfederation of Indian Industries, Federation of Indian Chambers of Commerce and Industries, Indian Medical Association,Federation of Obstetric and Gynecological Societies of India in order to attract the potential tourists who visits theirrespective websites. The Committee further suggested the Ministry to harness the medium of promotional literature inoverseas markets. Revamping of tourism and transport sectors in Andaman & Nicobar Islands 11.41 The Committee noted the reply and reiterated that a policy may be evolved at the earliest to revamp the tourism and transport sectors in Andaman and Nicobar Islands. The Committee recommended the Ministry of Tourism to pursue the matter with the Andaman & Nicobar Administration vehemently. The Ministry of Tourism may pursue the matter diligently with the Ministries of Civil Aviation, External Affairs and Home Affairs and the Committee may be informed of theresponses of these Ministries. Development of tourism in North-Eastern Region 11.42 The Committee recommended the Ministry of Tourism to take up the matter with the concerned State Government more actively so that the unique caves of Meghalaya and its ecology are protected from indiscriminate mining activities. Assessment of Annual Plan 2004-05 and allocation for 2005-06

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11.43 The Committee was of the view that the Ministry should formulate Plan budgets on realistic basis and also reviewthe same at quarterly intervals to monitor the utilization of the allocations under different Budget Heads. The Committee therefore recommended that the exercise undertaken during the preparation of Revised Budget Estimates should involve adetailed review of the progress of various projects rather than conducting the same in a routine manner.

(e) 96th Report (ATR on observations/recommendations of the Committee contained in its 88th Report on Demandsfor Grants (2005-2006) of the Ministry of Civil Aviation)

Assessment of Annual Plan 2004-05 and allocation for 2005-06

11.45 The Committee was of the view that the Ministry should formulate Plan budgets on realistic basis and also reviewthe same at quarterly intervals to monitor the utilization of the allocations under different Budget Heads. The Committee therefore recommended that the exercise undertaken during the preparation of Revised Budget Estimates should involve adetailed review of the progress of various projects rather than conducting the same in a routine manner. Indian Airlines 11.46 The Committee desired that Indian Airlines/Alliance Air would maintain their special role in fulfilling the socialobligations of the nation especially during the times of extreme distress. 11.47 The Committee expressed its anguish over the evasive comments of the Ministry offered in response to the recommendation of the Parliamentary Committee. The Committee was extremely unhappy about the lackadaisical approach of the Ministry on the issue of revision of scales of pay of employees of Indian Airlines. The Committee was of the view that the satisfaction level of the personnel in the matter of service conditions was a major factor affecting the performance of anyorganisation. The total inaction on the part of the Ministry in the matter of pay revision of employees of Indian Airlines was surprising especially in the present age of poaching and stiff competition by other Indian scheduled carriers. The Committee, therefore, reiterated that the Ministry should expedite its decision in the matter in the overall interest of the employees andthe organization. 11.48 The Committee noted the reply and was happy to note that the Ministry had now taken due cognizance of itsapprehensions regarding the pricing of aircraft being procured by Indian Airlines. The Committee desired that the actualacquisition of aircraft would now commence at the earliest in the best interest of Indian Airlines and the nation.

Opening of international routes for private airlines 11.49 The Committee noted that the reply furnished by the Ministry which consisted of the details of the process ofdecision making in the matter of allowing Indian scheduled carriers/private airlines to operate on international routes exceptthe Gulf countries. However, the Committee was unhappy to note that the Ministry had given evasive reply to the main issuein question regarding the grant of speedy clearances to a particular airline in pursuance of above decision. The Committee felt that if the Ministry was confident about the legality and transparency of the matter, as it had been attempted to be madeout in the reply, there should be no objection against an inquiry by an independent agency. The Committee, therefore, reiterated its recommendation that the matter of grant of speedy clearances to the particular airlines to enhance its IPOprospects, after the decision of the Government to allow Indian scheduled Carriers to operate on international routes, shouldbe inquired into by an independent agency. 11.50 The Committee noted from the reply of the Ministry that there were only two minimum eligibility criteria prescribed for selection of scheduled domestic airlines to be allowed to operate on international routes, namely, a minimumfleet strength of 20 aircrafts and a minimum experience of five years operations on domestic routes. The Committee also noted that the basic policy of the Government to allow the scheduled carriers to operate on international routes had beenframed after due consideration of the Report of Naresh Chandra Committee, which was submitted to the Ministry inDecember 2003. The said committee had reportedly revealed that only 40 per cent of our bilateral rights were used. However, the Committee felt that the steep restrictions imposed by the Ministry are impediments in achieving the basic objectives behind the new policy to mitigate under capacity in the international segment and to enhance global connectivityto and from different States in the country. The Committee recommended that in view of the irreversible nature of the newpolicy, the Ministry should review its prescribed standards regarding fleet strength, maintenance facilities, safety systems etc.for granting licences to new airlines in the domestic sector, taking into consideration the requirements for the internationalsector also. Such a review would enable the relaxation of the existing stringent restrictions on Indian scheduled airlines for international operations. The Committee also noted that the stringent restrictions have not been able to avoid the denial offlights to one of the private airlines to destinations in the United States of America.

11.51 The Committee was not satisfied with the reply of the Ministry as it had not charted out any long-term plan for the implementation of the new policy of opening up the international skies to the Indian scheduled airlines. The Committee

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recommended that the Ministry should frame a comprehensive plan identifying international sectors to be covered by AirIndia/Indian Airlines/International Scheduled Carriers so as to avoid any conflict of interests and at the same time ensuringfull realization of the objective to enhance utilization of traffic rights available to India. Review of route dispersal guidelines

11.52 The Committee failed to understand the nature and reasons for the inordinate delay by DGCA and that of theMinistry, of over nine months to come out with a specific time frame for accepting the recommendation. The Committee recommended that the matter be expedited with desired pace.

Requirement of trained manpower 11.53 It was evident from the reply of the Ministry that their major emphasis was the training of pilots and other equally important areas of civil aviation sector are being ignored. The Committee recommended that the Ministry should encourage the opening of training institutions in public sector/joint venture/private sector for imparting holistic training covering all theareas of the civil aviation sector. 11.54 The Committee noted carefully the assurance given by the Ministry. The Ministry, however, must ensure that Indian Airlines, which had to meet the social obligations also, should not suffer from the shortage of manpower. TheCommittee was suspicious of the intention of the Government to prevent poaching of trained manpower from Indian Airlinesbecause no action had been taken by the Government with regard to the revision of scales of pay of the employees of IndianAirlines, which became due on 1.1.1997.

Underutilization of ILS CAT-III system installed at Indira Gandhi International Airport, Delhi 11.55 The Committee was not satisfied with the reply of the Ministry and felt vindicated by the developments during the fog this winter. The massive disruption of flights into and out of Delhi had highlighted the gross underutilization of the costly ILS CAT-III system installed at Indira Gandhi International Airport. This had resulted in the non-utilisation of the expenditure from the taxpayers’ money. It appears that the different airlines resort to diversion of flights instead of using theavailable infrastructure because it was economical for them to follow such practice rather than training the pilots on CAT-III system. The Committee felt that whatever be the reasons, the passenger facilities should be paramount and they should notbe put to any hardship. Moreover, even if IA and AI have trained their pilots and are using the system, the diversion of flights of the private carriers gives adverse publicity to the civil aviation sector as a whole. The Committee felt that there should be some penal provision to discourage the diversion of flights due to fog by the private operators or they should becompelled to utilise the ILS CAT-III system. The Committee took note of the relevant news reports appearing in the print and visual media and the inadequate response of the Ministry thereon. The Committee also noted that the Ministry was nowwaking up to the need for the implementation of the recommendation in the face of severe public criticism. The Committee,therefore, reiterated its recommendation that in order to improve the operational efficiency during the extreme foggy conditions, training of pilots should be made compulsory by the private airlines on CAT-III System. The Committee further recommended that utilization of CAT-II and CAT-III systems by private airlines should be made compulsory by training a fixed minimum proportion of their pilots and the Government should enforce it strictly.

Allotment of parking bays 11.56 The Committee was not satisfied with the reply of the Ministry and stresses the fact that before giving licenses to new airlines to commence operations, the Ministry should deliberate on the infrastructure and maintenance facilities like,taxiways, additional bays, runways etc. required at the airports to avoid further load on the already congested infrastructureavailable at the airports. The Committee, therefore, reiterated its recommendation that the Government should frame atransparent policy for allotment of parking space and also take immediate steps to ensure that adequate infrastructure andmaintenance facilities, hangers and parking bays are made available for all the airlines providing a level playing field in thematter of allotment of parking bays etc. High cost of Air Turbine Fuel (ATF) 11.57 The Committee was happy to note that the Sales Tax on ATF purchased for International flights by designated Indian carriers had been exempted. The Committee does not agree with the Finance Ministry that the proposal for notifyingATF sold to domestic flights, as "Declared Goods" would have serious revenue implications for the State Governments. TheCommittee, however, appreciates the view of the Ministry of Civil Aviation that the State Governments may get affectedonly marginally by the above measure and such measure will certainly improve the health of the aviation industry in thecountry and ultimately fostering the economy, tourism and regional development to a great extent.

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Modernisation and restructuring of Delhi and Mumbai Airports 11.58 The Committee was not convinced with the reply put forth by the Ministry and observed that clear-cut statistics with regard to modernization of airports should be given to the public and the Parliament. As the proposal regarding modernization and restructuring of Delhi and Mumbai Airports involves huge expenditure and also determines the future of aviation sector in this country, the exaggerated initial cost estimates indicates poor financial planning. The Committee felt that the unrealistic cost estimates at the planning stage might have swayed the decision in favour of the Joint Venture route.

11.59 The Committee was constrained to note that the proposal of AAI of the year 2000 for construction of terminalbuildings of Delhi and Mumbai airports were kept pending till September 2003 and thereafter shelved when it was decided torestructure Delhi and Mumbai airports through Joint Venture Route (JVR). The Committee noted with grave concern thateven after the lapse of more than two years since this decision, which was targeted to make the two airports of “world class standards”, the modernisation and expansion plans were still hanging in air, thereby affecting the capability of these two mostimportant airports to handle the demands of fast changing international as well as domestic aviation sector.

11.60 The Committee was also of the view that the Ministry had taken a prejudiced view on the alternative proposal submitted by the AAI Employees Joint Forum. The Ministry had submitted the following documents for the perusal of the Committee vide its O.M. No.AV.24011/012/1998 – VB (Pt.) dated the 29th December, 2005: -

(i) Para-wise comments of the Ministry of Civil Aviation on the D.O. letter dated 5/12/2005 from Shri Dipankar Mukherjee, Member of Parliament, addressed to the Hon’ble Prime Minister regardingmodernisation of Delhi and Mumbai Airports;

(ii) Alternate Plan submitted by the AAI Employees Joint Forum for development and modernisation of Delhiand Mumbai Airports; and

(iii) Report of the Committee to examine the Alternate Plan submitted by the AAI Employees Joint Forum.

11.61 The Committee noted that the Ministry had sent the Alternate Plan to the GTA and Financial Consultant for evaluation, however, their report was not annexed with the comments of the Review Committee but only the brief commentsof the Review Committee on the evaluation report was included therein. The Review Committee had held that the basic characteristics of the proposals of the Bidders vis-à-vis the Alternate Plan were incomparable and therefore the methodologyadopted by GTA could not be considered fair. As the Alternate Plan was not submitted in response to RFP document meantfor the bidders in the JVR, it was surprising that the Ministry initially forwarded the plan to the GTA & FC for evaluation andthereafter rejected their report thereby rendering the process an exercise in futility. The Review Committee decided that theAlternate Plan was to be evaluated on stand-alone basis on the merit of its content. The Committee however noted that the Review Committee had at many places drawn comparisons with the private bidders. However, the Committee also noted thatthe Review Committee had accepted the concepts and the details of works proposed in the Alternate Plan on the grounds thatit was similar to the earlier proposal of Airports Authority of India but subject to updating/revision of the cost estimates tocurrent levels.

11.62 On the examination of the comments of the Review Committee, the Committee wished to highlight the conclusionsthat the estimated expenditure required for Delhi & Mumbai Airports and the projects at non-metro airports was feasible through internal resource generations and borrowings. The financial strength of Airports Authority of India and the growthrealized/witnessed in the aviation sector in the recent past also supported the conclusion reached by the Review Committee.In this context, the Committee had earlier expressed its reservations/objections on the financial implications projected by theMinistry on the modernisation plans for the Delhi & Mumbai Airports and reiterated that the estimates put forth by them areexaggerated and not firmed up on realistic basis. The other factors commented to in the report of the Review Committee viz.fast track procedures for granting approvals / sanctions to the projects; benchmarking of services to achieve higher levels ofcustomer satisfaction; maximizing non-aeronautical revenue etc., were achievable with proactive efforts of the Ministry/Airports Authority of India on the one hand and plan implementing agency on the other. 11.63 The Committee therefore recommended that the Government should rethink its strategy for modernisation of Delhi& Mumbai Airports and immediately implement the in-house plan developed by Airports Authority of India Employees Joint Forum. New Greenfield Airports at Bangalore and Hyderabad 11.64 The Committee noted the reply and expected that the Ministry would frame the standard norms and definitions for

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benchmarking of airports before proceeding further to implement the new Greenfield Airports.

Closure of Existing Hyderabad Airport 11.65 The Committee observed that the aviation sector in the country had changed dramatically with the low cost carriers gaining ground. The previously unviable routes are now proving to be profitable ones and there was stiffcompetition amongst the private operators to extend their reach to all parts of the country. In this changed scenario, instead of reassessing its strategy, the Ministry was following the unhealthy policy of creation of monopoly by promoting only oneairport at different metros, as in the case of Delhi and Mumbai. The Committee also noted that the justification put forwardby the Ministry for the closure of the existing airport at Hyderabad was contrary to the rationale of the Ministry for rejecting the proposals for Greenfield airports at Delhi and Mumbai. In respect of those two airports, the Ministry had maintained throughout that unless the capacity was not optimized or added in the existing Brownfield airport, it was not prudent to set upa Greenfield airport. The Committee, therefore, reiterated that the Government should reconsider the decision to close down the existing airport at Hyderabad on the commissioning of a new International airport. Protection to the Interests of the Employees of Airports Authority of India 11.66 The Committee noted the reply of the Ministry and found that there was no assurance of protection of the existingterms and condition of service of the employees of Airports Authority of India after restructuring of Delhi/Mumbai airports. With respect to Greenfield airports of Bangalore and Hyderabad, the Committee was not satisfied with the reply thatGovernment had obtained comfort letters from the JV Companies that they would consider taking on deputation / absorption basis the existing employees other than Communication Navigation Surveillance (CNS) /Air Traffic Management (ATM)employees. The Committee recommended that performance standard appraisal of the employees to be retained in JVCs should be done on fair basis.

Creation of a Eastern Hub at Kolkata 11.67 The Committee noted the reply and found that the Ministry had not mentioned anything about the recommendation for the creation of a southern hub at Chennai. Further, the reply had not indicated the details of the work undertaken at Chennai airport. The Committee desired that air hubs at Kolkata and Chennai will be created very soon and airlines would be given incentives for use of these airports for parking etc. by levying lesser charges.

Pawan Hans Helicopters Limited 11.68 The Committee noted the reply and felt that the Ministry had not fully appreciated its recommendation. There was no denying the fact that helicopter services could not be a viable alternate mode of travel in those places where fixedwing aircrafts are operating presently. The Committee was of the view that if the Ministry found the non-accessible tourist destinations non-viable for operations by PHHL, it should at least offer attractive terms and conditions for the wet lease of helicopters to State Governments/Government agencies/Private parties to enable them to tap the tourism potential in variousparts of the country. 11.69 The Committee was not satisfied with the reply furnished by the Ministry. The Committee had not been apprised about the details of the safety audits of the Helicopter operators and instead a routine reply that ‘safety audits are being conducted on continuous basis’ had been given. The Committee recommended that the Ministry should evolve permanent mechanism viz. constitution of a Helicopter Cell, to monitor the helicopter operations in view of the Kaushik Committee Report. As regards the proficiency rating system of pilots in DGCA, the Ministry vide O.M. No.A.60011/020/2005-VE dated 4th May, 2005 had informed, inter-alia, that the lone post of Flight Inspector (Helicopter) in the Office of DGCA fell vacantin December 2001 and the same was filled up on ad-hoc basis for one year w.e.f. 16th August 2003. This post had again fallen vacant as the appointee was unwilling to continue beyond one year and wasrelieved of his duties w.e.f. 16th August, 2004. Accordingly, this post was re-advertised. The Ministry has, however, not informed whether the same had been filled up now. The Ministry further informed that proficiency checks of Pilots areconducted by Examiners approved by DGCA, on bi-annual basis to comply with the requirements of the Aircraft Rules, 1937. The Committee noted that the DGCA Inspector was associated as an observer in those cases where consecutive checksare carried out by the same examiner to ensure sanctity of the proficiency check. The Committee found that the reply was highly insufficient on the procedure for proficiency checks of the pilots. The Committee was surprised to note that the post of Flight Inspector (Helicopter) had been lying vacant for long periods of time and therefore was of the opinion that theMinistry had not been able to ensure foolproof proficiency checks. The Committee, therefore, recommended that the Ministry should review its institutional mechanism on the proficiency rating system of pilots in DGCA.

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Revamping of Transport Sector in Andaman and Nicobar Islands in Post Tsunami Scenario 11.70 The Committee noted the reply of the Ministry regarding affordable air connectivity to Port Blair, Andaman & Nicobar Islands. However, the Ministry had not responded to the recommendation regarding the need to encourage privateairlines to fly to these Islands besides allowing airlines operating from South and South East Asian countries to have stopoverat Port Blair. The Ministry should also review its stand on inter-island air connectivity in Andaman and Nicobar Islands in order to boost tourism in these islands. As regards LTC facility, it seems that the Ministry had not appreciated fully the recommendation made by the Committee. However, the Minister in his Statement made in Lok Sabha on the 12th May, 2005 had appreciated the recommendation and had assured to take up the matter regarding LTC facility with the Department ofPersonnel & Training. The Committee understands that the Government had since formulated a LTC Scheme for the CentralGovernment employees for visiting Andaman & Nicobar Islands, which was effective till 25th November, 2005. The Committee felt that the period of operation of the Scheme was too short to have a positive impact on the tourism sector of the Islands specifically taking into consideration the magnitude of the devastation caused by tsunami. The Committee notedthat a large number of government employees had already availed this facility but still there were many who desired to availLTC to Andaman and Nicobar Islands. The Committee therefore recommended that this LTC Scheme should be extended for a suitable period of time in order to encourage more and more domestic tourists to visit these islands, thereby helping itstourism sector to attain sustaining levels.

Development of Airports and Increase in Flights in North Eastern States 11.71 The Committee noted the reply of the Ministry and hoped that the need for reflecting the rich cultural and architectural heritage of respective regions through airport buildings will be made mandatory while modernizing the existingairports albeit with private participation and also while commissioning new airports in public or private sector in the country. 11.72 The Committee noted that the data furnished by the Ministry in the matter of security-related and developmental expenditure relates to different time periods. Whereas, the security-related expenditure gives the actual amounts incurred during the financial year 2003-04, the details under the developmental expenditure are tentative/estimated figures in respectof the ongoing major developmental works. The lack of correlation between the data under the two heads exhibits the non-serious attitude of the Ministry towards the recommendation of the Committee for initiating value audit and developmentaudit. The Committee expressed its unhappiness on the casual approach of the Ministry towards the development of the aviation sector in the North Eastern region of the country. 11.73 The Committee partially accepted the reply of the Government but still recommended that operational procedural bottlenecks should be removed at the earliest and the Aizwal Airport should be given IFR status which was much required for a hill locked State like Mizoram. (f) 97th Report (ATR on observations/recommendations of the Committee contained in its 90th Report on 'Development of Airport Sector with special emphasis on new modern airports’) Modernisation and Restructuring of Delhi and Mumbai Airports

11.74 The Committee was not convinced with the reply put forth by the Ministry and observed that clear-cut statistics with regard to modernization of airports should be given to the public and the Parliament. As the proposal regarding modernization and restructuring of Delhi and Mumbai Airports involves huge expenditure and also determines the future of aviation sector in this country, the exaggerated initial cost estimates indicate poor financial planning. The Committee felt that the unrealistic cost estimates at the planning stage might have swayed the decision in favour of the Joint Venture route. 11.75 The Committee was not satisfied with the reply furnished by the Ministry. The Committee was not convinced that the Government could not mobilise the funds for executing the modernisation plan of Delhi and Mumbai airports on its own as the estimated quantum of investment was required over a period of 15 to 20 years. Moreover, the modernisation plan for the Mumbai airport could not address the situation beyond the year 2014. The Committee therefore recommended that the Government should reconsider its plans to privatise Delhi and Mumbai airports under the garb of modernisation and instead give a serious consideration to the workable alternate plan suggested by Airports Authority of India Employees Joint Forum.The Committee also recommended that the Government should immediately initiate the groundwork for Greenfield Airportsin Delhi and Mumbai with public-private participation.

11.76 As regards performance standards, the Committee was sad to note that even today the Airports Authority of India does not have an institutional mechanism to take appropriate action / curing of deficiency, as pointed out in the surveyconducted by IATA regarding performance standards, and there was no penalty / liquidated damage imposed on AAI for

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non-attainment of standards. It indicates that due to lack of provision of imposing penalty/liquidated damage on AirportsAuthority of India for non-attainment of standards, AAI could not fulfil consumer satisfaction and meet international normsand standards. The Committee felt that this needs to be corrected. In an era of globalisation, a major profit making PSU like the Airports Authority of India cannot function in an isolated manner in the aviation sector. There should not be any compromise in terms of consumer satisfaction and overall compliance to international norms and standards. Both Airports Authority of India and any other private sector entrant through JV route should be treated at par. The Committee failed to understand that if Airports Authority of India lacks adequate mechanism to cure deficiencies and was not conforming tointernational performance standards, then how it was handling all other airports in the country. 11.77 The Committee noted that in the assessment report of the Global Technical Advisor (GTA) on airfield capacity ofMumbai airport, it had been stated that with enhanced taxiways and enhanced ATC procedures, the existing runway could accommodate projected traffic to between 2009 and 2014. Moreover, with some increase in average aircraft size, the existing runway, with enhanced taxiway and ATC procedures could accommodate projected traffic to beyond 2014 and to achieve the20 year forecast traffic, a wide spaced parallel runway would be required. In brief, the Ministry was of the opinion that the existing airport will cater to traffic upto 2014 and that capacity on the airside and terminal will need to be created to cater totraffic upto 2014 and beyond. 11.78 The Committee observed that there was a contradiction in the stand of the Ministry as they first agreed that therewas no scope for any further development on the airside at Mumbai airport since there was no scope of having a secondrunway at that airport which could be helpful in terms of air-operations. The position now informed by the Ministry was that "There was a huge difference between the cost of incremental capacity at a Brownfield Airport and the cost of creating the same capacity through the Greenfield Airport. As long as the capacity was not optimized at the Brownfield airport, foregoing the option of creation of additional capacity at the Brownfield Airport and setting up a Greenfield Airport will not be prudent". 11.79 The Committee felt that the Ministry was keeping the Committee half informed as they are now saying that"parallel or two runways not necessarily generate adequate capacity if well designed taxi ways and parking bays do not co-exist". The Committee had not been informed about the present scheme of things and the proposed modernizationprogramme to be undertaken in the immediate future at Mumbai/Delhi airports by the private sector and how much capacitywas estimated to be added and whether there will be newly designed taxi ways and parking bays.

11.80 The Committee desired that the Ministry should atleast now apprise it clearly about (a) the traffic and cargo expected to increase in future in the normal course on five yearly basis; the capacity addition with modifications in theexisting Brownfield airports in Mumbai and Delhi through modernization under JV route; (b) the expected increase intraffic/cargo after modernization of Mumbai and Delhi airports; (c) the cost estimation of Greenfield airports atMumbai/Delhi and the capacity of those airports in terms of time period vis-à-vis traffic and cargo to be handled; and (d) the difference in the cost of modernization of the existing Brownfield airports and construction of new Greenfield airports. 11.81 The Committee was of the opinion that without a proper assessment, it will be myopic to conclude that there wasno immediate need of Greenfield airports at Mumbai and Delhi. The Ministry had not even estimated as to when the trigger point will occur in terms of traffic growth to justify the new Greenfield airports in these metro cities. It was surprising to note that even at the planning stage, the Ministry was proposing to provide a Right of First Refusal (ROFR) for the second airportto the airport operator at Delhi / Mumbai, thereby favouring JV route. The existing plans therefore may lead to a situationwherein both the existing as well as the second airports at Delhi/Mumbai will be under the management control of privateoperators. 11.82 The Committee was also of the opinion that the Ministry should reconsider its present plan on the modernisationand restructuring of Delhi and Mumbai Airports keeping in view the current scenario of the domestic as well as internationalaviation sector. The present plan will only create monopoly in Delhi and Mumbai. The Ministry had turned a blind eye to the paradigm shift which was occurring in South East Asian and East Asian countries where the focus was on thedevelopment of both Greenfield and Brownfield airports together, serving the dual purpose of enhancing the capacity andproviding healthy competition in the best interests of the aviation sector. 11.83 The Committee noted carefully the assurance given by the Ministry that "AAI will be better off as during the period 2006-2024 the present value of cash flow would be Rs.1286.5 crores where as if status quo was maintained then there couldbe a negative present value of cash flow to AAI at Rs. (-) 998.89 crore" and "post restructuring AAI will not only be able to maintain other airports in the country but also upgrade and modernize these airports". However, the Committee reiterated its observations/recommendations that theMinistry should review its strategy for the modernisation and restructuring of Delhi and Mumbai Airports.

Greenfield Airports at Bangalore and Hyderabad

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11.84 The Committee was not convinced by the reply furnished by the Ministry on the Greenfield Airport at Bangalore. It was clear from the reply that the clause regarding the operation of the EPC Contracts by the Joint Venture Partners did notexist in the initial International Bidding Process. The issue of EPC contracts was settled between the shortlisted bidders at alater stage that too at the instance of such bidders. The Committee noted that the deviation from the transparent competitivebidding process can be resorted only in exceptional cases. The Committee found that the Ministry had not justified the existence of exceptional circumstances in the award of EPC contracts at BIAL to Joint Venture Partners (JVPs). Therefore, it was fallacious to contend that the procedure adopted for selection of the JVP being in itself a bidding process; it was a validground for not adopting a bidding process for the realization and operation of the project. The Committee was therefore of the opinion that the further procedures evolved in respect of EPC contracts do not cure the inherent lacuna in the award ofsuch contracts to JVPs. Moreover, the justification sought by the Ministry on the issue by quoting similar instances of awardof EPC contracts to strategic investors in other projects by other Ministries cannot be accepted. The Ministry had earlier denied the existence of the award of EPC contracts to JVPs at BIAL before the Committee and the present justification wasmerely an afterthought, if not an outright attempt to mislead the Committee. The Committee noted that the Ministry had now issued detailed guidelines in this regard to all State Governments for compliance in future. The Committee however, reiterated its recommendation that a proper enquiry should be conducted into the entire matter by an independent agency asto why the provision of awarding EPC by competitive mode was missing in the case of BIAL. 11.85 The Committee noted the reply of the Ministry. The Committee recommended that it should be apprised about the details of the financial modalities adopted in the case of Hyderabad Airport. 11.86 The Committee was not satisfied with the reply. The Committee in its Report on the ATR furnished by theMinistry on the recommendations/observations made in the 88th Report had recommended that the Government should reconsider the decision to close down the existing airport at Hyderabad on the commissioning of a new International airport. The recommendation was reproduced below: -

“The aviation sector in the country had changed dramatically with the low cost carriers gaining ground. The previously unviable routes are now proving to be profitable ones and there was stiff competition amongst the privateoperators to extend their reach to all parts of the country. In this changed scenario, instead of reassessing its strategy, the Ministry was following the unhealthy policy of creation of monopoly by promoting only one airport atdifferent metros, as in the case of Delhi and Mumbai. The Committee also noted that the justification put forward bythe Ministry for the closure of the existing airport at Hyderabad was contrary to the rationale of the Ministry for rejecting the proposals for Greenfield airports at Delhi and Mumbai. In respect of those two airports, the Ministry had maintained throughout that unless the capacity was not optimized or added in the existing Brownfield airport, itwas not prudent to set up a Greenfield airport. The Committee, therefore, reiterated that the Government should reconsider the decision to close down the existing airport at Hyderabad on the commissioning of a new International airport.”

11.87 The Committee observed that the Government was considering the question of waiver of condition of dependence of budgetary support in view of the special circumstances where AAI had to maintain certain airports irrespective of commercial viability and appointment of non-official directors on the board. The Committee hoped that Airports Authority of India will be given the status of 'Mini Ratna' at the earliest so that it gets adequate opportunity to utilize its professionalexcellence in the area of development and maintenance of airports in the country and recommended that the process be expedited. Protection to the Interests of the Employees of Airports Authority of India 11.88 The Committee was not satisfied with the reply. In this connection, the Committee would like to invite the attention of the Ministry towards the recommendation made in the Report on ATR furnished by the Ministry on the observations/recommendations contained in the 88th Report, which was reproduced below: -

“The Committee noted the reply of the Ministry and found that there was no assurance of protection of the existingterms and condition of service of the employees of Airports Authority of India after restructuring of Delhi/Mumbaiairports. With respect to Greenfield airports of Bangalore and Hyderabad, the Committee was not satisfied with thereply that Government had obtained comfort letters from the JV Companies that they would consider taking on deputation / absorption basis the existing employees other than CNS / ATM employees. The Committee recommended that performance standard appraisal of the employees to be retained in JVCs should be done on fairbasis.”

Connectivity of the Airports

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11.89 The Committee noted the reply of the Ministry that JVCs who will be operating the Delhi/ Mumbai airports after restructuring will sign State Government Support Agreements with the concerned State Governments. The Committee reiterated its concern that the State Governments in these two prime metro cities have their own limitations and it was almostimpossible to wipe out traffic hindrances despite Mass Rapid Transport Systems. Therefore, it will be prudent to developGreenfield Airports in these two metro cities also instead of adopting a flawed approach of upgrading the present Brownfieldairports only, which will get choked within few years and then investing in Greenfield airports.

Parking Space and Infrastructural Facilities at the Airports 11.90 The Committee was not satisfied with the reply of the Government and stresses the fact that before giving licenses to new airlines to commence operations, the Government should deliberate on the infrastructure and maintenance facilitieslike, taxiways, additional bays, runways etc. required at the airports to avoid further load on the already congestedinfrastructure available at the airports. The Committee, therefore, reiterated its recommendation that the Government should frame a transparent policy for the allocation and access to the existing infrastructure and take immediate steps to ensure thatadequate infrastructure and maintenance facilities are made available and allocated fairly and rationally amongst all theairlines. 11.91 The Committee noted the reply and found that the Ministry had not mentioned anything about the recommendations for the creation of an eastern hub at Kolkata and southern hub at Chennai. Further, the reply had not indicated the details of the work undertaken at Chennai airport. The Committee hoped that air hubs at Kolkata and Chennai will be created very soon and airlines should be given positive incentive for use of these airports for parking etc. by levyinglesser charges.

Development of Non-Metro Airports 11.92 The Committee noted the reply and hoped that the development works will be started expeditiously in the non-metro airports identified by the Government.

Encroachment of Land at Airports Authority of India Airports 11.93 The Committee noted the reply and further hoped that all the cases of encroachment are disposed of expeditiously and reiterated its recommendation that the Airports Authority of India should evolve some mechanism to take better care ofthe vast lands at its disposal, so that no further encroachments take place on the lands of Airports Authority of India and theairport may be revived for operations.

Acquisition of Land by AAI for Airport Development 11.94 The Committee noted that the Ministry in its reply had not ascertained whether the Airports Authority of India had purchased land from various State Governments for developmental works, such as extension of runway, extension of carparking etc., only in those airports which are making profit and Airports Authority of India had never purchased land from State Government in case of non-viable airports. It was also a fact that by developing this particular airport at Gaya, Airports Authority of India will also earn some revenue. Therefore, the Committee recommended that some via media should be evolved and the Airports Authority of India Board should reconsider its stand to acquire 101 acres of land from the Government of Bihar free of cost. (g) 98th Report (ATR on observations/recommendations of the Committee contained in its 83rd Report on 'Functioning of the Commission of Railway Safety')

Appointment to the Cadre of Commission of Railway Safety 11.95 The recommendation of the Committee was aimed at making the Commission of Railway Safety function effectively with greater powers and independence and to enhance its confidence and credibility by dispelling the generalimpression that the Ministry of Railways influences it. The Ministry had on the one hand claimed that the present arrangement of the Commission of Railway Safety being placed under the Ministry of Civil Aviation had been working satisfactorily since May, 1967 but on the other it had been stated that the present set up does not provide enough avenues tomiddle level officers for further advancement in the Commission, thereby railway officers would be unwilling to join theCommission on absorption basis. The Committee found these submissions contradictory. The Committee, however, notedthat a proposal on making the Commission an autonomous body like Election Commission / Union Public ServiceCommission was under consideration. The Committee recommended that the said proposal should be expedited within a

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fixed timeframe and it should also include the aspect of comprehensive cadre review so that the impartiality andindependence of the Commission was ensured.

Effectiveness of Recommendations of Commission of Railway Safety 11.96 The Committee noted that the Ministry of Railways had stated that the recommendations made by the Commissionof Railway Safety are generally accepted and if any recommendation was not found feasible for acceptance, reasons thereofare communicated to the Commission. They have further stated that there was regular interaction between Railway Board and the Commission of Railway Safety regarding recommendations by the latter. In this connection, the Commission hadearlier informed the Committee that the Ministry of Railways had made a commitment before the Appointments Committeeof Cabinet in 1998 that in case the Railways had any reservation on any recommendation, the same was discussed with theCommission before a final decision was taken. It was also informed by the Commission that with the passage of time, theMinistry of Railways had changed their stand and no discussions are held with the Commission on any serious issue raisedby it. The Committee therefore felt that the present comments of the Ministry of Railways are misleading when it states thatthere was regular interaction with the Commission on their recommendations. The Committee therefore reiterated its recommendations that the Ministry of Railways should not reject or overrule any recommendation made by the Commission without a meeting between the Chairman, Railway Board and the Chief Commissioner of Railway Safety or without givingdetailed reasons for not accepting the recommendations and that any decision taken by the Railway Board in consultationwith the Commission of Railway Safety must not be revoked unilaterally by the Railway Board or Zonal Railway, withoutprior consultation and approval of the Commission. The Committee further recommended that the Commission of Railway Safety should submit half yearly reports to the Committee about the status of its recommendations indicating the discussions,if any, called by the Ministry of Railways on the issues of difference of opinion. 11.97 The Committee noted the reply of Ministry of Railways and appreciated the fact that introduction of new trains etc. was one of the executive functions of Ministry of Railways. The Committee had desired that before starting the actual operation of any passenger train, the safety aspects should be got approved from the Commission of Railway Safety. TheCommittee, therefore, reiterated its recommendations that the existing statutory provisions should be amended to make it mandatory for the Ministry of Railways to seek the concurrence of Commission of Railway Safety before the introduction ofany new passenger train. Publication of Reports on Railway Accidents 11.98 The Committee noted the reply and recommended that the Ministry of Civil Aviation should pursue the matter regarding the incorporation of suitable amendments in the Indian Railway Act, 1989 with Ministry of Railways to facilitatesmooth and expeditious progress of inquiry proceedings and the immediate publication of inquiry reports of the Commissionof Railway Safety on railway accidents. Supply of Railway Circulars etc. to Commission of Railway Safety 11.99 The Committee noted the replies of Ministry of Railways and Ministry of Civil Aviation and reiterated its recommendation that the Commission of Railway Safety should be supplied with the proceeding of the TechnicalCommittees of Railway Board so that the Commission remains informed of the safety problems encountered in the workingof the railways and the measures taken to solve these problems. Lack of Office Infrastructure 11.100 The Committee was unhappy about the indifferent attitude of the Ministry, as can be made out from the reply. Itshows that the Ministry was unaware of the lack of budgetary allocations and proper infrastructure and office machineryrequired for the functioning of the Commission of Railway Safety. The Committee recommended that the Ministry shouldtake initiative for identifying and processing the financial requirements of the Commission and pursue it with the Ministry ofFinance. Announcement of Prima-Facie cause of accidents by Railway Administration 11.101 The Committee noted the reply given by the Ministry of Railways and was of the opinion that a practice could notearn legitimacy for the reason of it being inexistence for a long time. The Railway authorities, if required, may clarify the statutory requirements to the public/media instead of announcing the prima facie cause of accidents. The Committee, therefore, reiterated its recommendation that the Railway administration should refrain from speculating and giving theprima-facie cause of an accident, which was required to be statutorily enquired by the Commissioner of Railway Safety. 11.102 The Committee reiterated its recommendation that the Government should bring a comprehensive legislation to

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improve the functioning of the Commission of Railway Safety in public interest and further recommended that the proposedRailway Safety Act should be finalized in a time bound manner. (k) 102nd Report on the Demands for Grants (2006-07) of the Department of Road Transport and Highways:

The Tenth Plan Provisions and Annual Plan 2006-07

11.103 The Committee found that despite its earlier recommendations on the aspect of funds utilization and the need for constant monitoring of projects, the Department of Road Transport and Highways had done precious little to improve thesituation. This was evident from the reply of the Department with regard to non-utilisation of funds that the allocation for road sector was based on anticipated implementation of projects every year. The trend from the year 2002-03 onwards would reveal that the actual utilization had been more or less steady and consistent. The slippages occur when major projects do not get implemented for the years they are projected for implementation. For instance, allocations for programmes of NHDPPhase III and SARDP NE did not materialize fully because the approvals were not available in the time frame projected. TheCommittee desired to know as to why approvals were not available in time and whether any responsibility had been fixed inthe matter. The Committee observed that the budgetary allocation of the Department of Road Transport and Highways was substantially increased from 2004-05 (Revised Estimates) of Rs.8566.00 crore to Rs.13293.75 crore during 2005-06 and for 2006-07 (Budget Estimates) the allocation had again been increased to Rs.15307.31 crore. The Committee, therefore, re-emphasises that the Department of Road Transport and Highways should devise strategies, in such a way so that they are able to fully utilize the funds placed at their disposal. They should also evolve some mechanism to identify bottleneckscausing delays and work towards resolving all such hindrances in coordination with all the concerned agencies. This wouldalso help them to avoid time overrun and consequential cost overrun of the projects to be executed by them.

11.104 The Committee noted that in the Mid-Term Appraisal of the 10th Five Year Plan, it was recommended that the Ministry of Shipping, Road Transport and Highways should prepare a detailed programme for the next two years keeping inview the level of budgetary support available and the need for leveraging to the maximum extent by adopting a proper mix ofengineering, procurement and construction (EPC) and Build Operate and Transfer (BOT) projects. In view of the repeatedunder-utilization of Budget allocation year after year, the Committee felt that the Department should not feel aggrieved by the fact that the Budget provision for 2006-07 had been enhanced by only 10% from the Budget provision for the year 2005-06 despite enhancement of 11.2% in the cost of construction during 2005 following increase in price indices of the basicingredients of the road sector – steel, cement and bitumen. The Committee, therefore, recommended that the Department ofRoad Transport and Highways should devise effective institutional mechanisms to constantly monitor the progress of theprojects under implementation and to ensure optimum utilization of funds. This mechanism should also involve means to fixresponsibility at Project Head Level for the delay in completion of projects thereby acting as a deterrent for cost and timeover-runs. The Committee recommended that the Department should also explore the possibility of opening of moreBudget/Accounting Offices keeping in view the increasing number of projects under implementation.

National Highway Development Programme (NHDP)

11.105 The Committee was constrained to note that the Golden Quadrilateral Project, which was initially scheduled to becompleted by the end of 2003, will now stretch upto 2007-08 and only 557 km of North South East West (NSEW) Corridor Project of 7300 km had been completed against the deadline for completion of entire project by December 2007. The Committee recommended that action for Revised Estimates awarding the Ganjam-Icchapuram Section of National Highways – 5 of 50.8 km. Length in Orissa, which was a part of the Golden Quadrilateral project are yet to be awarded, should becompleted at the earliest and it should be ensured that the actual construction work was completed within the stipulated time-frame. The Committee took exception to the fact that in NSEW Corridor project, the Department could not achieve the targetfor award of contracts of 5722 km by December 2005 in a phased manner and the target date had been shifted to March 2006. In this context the Committee was surprised to note that the BE allocation for NHAI had been scaled downconsiderably during 2004-05 and 2005-06 in the respective Revised Estimates. The reasons for slowing down of the pace ofconstruction put forward by the NHAI was unacceptable to the Committee in view of the fact that although GoldenQuadrilateral Project was in the final stages of completion but considerable work was still pending in NSEW CorridorProject. The Committee, therefore, recommended that the Department should play a proactive role in ensuring strictcompliance of the targets fixed for completion of awarded projects and also the schedules for award of contracts in thepending projects. The Committee was of the view that proper verification of bank guarantees submitted by contractorsshould be undertaken at the initial stage itself to avoid termination of the contracts at a later stage. The Committee noted thatincreasing numbers of contracts are under implementation and being awarded. Therefore, it was recommended that theDepartment should be vigilant in respect of each contract and should strictly enforce the compensation conditions in thecontracts in respect of non-performing contractors. The Committee, further, recommended that the Department should not wait for the targeted date of completion to initiate action but should fix short-term targets for the contractors so that the projects can be monitored constantly and immediate and early remedial action may be taken in case of anticipated delays.

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The Committee also felt that the Department should draw-up a database of the performance of the contractors involved inNHDP and encourage outstanding contractors, who strictly comply with the construction standards and quality control andalso complete the projects well within the targeted date, to undertake more and more projects as incentives. Roads of Inter-State Connectivity & Economic Importance

11.106 The Committee was surprised to note that no new works under the scheme of Inter-State Connectivity and Economic Importance had been sanctioned so far during the year 2006-07. The Committee recommended that the Department should expedite the ongoing projects and should devise clear guidelines on sanctioning such projects so that new places of economicand tourist importance can be provided connectivity thereby, giving a boost to the economic growth and also to the efforts forrealizing the vast tourism potential of our country. Upgradation of National Highways from Four Lane to Six Lane under National Highway Development Project (NHDP) Phase-V

11.107 The Committee noted that a Working Group under the Secretary, Department of Road Transport and Highways wasexamining the planning and cost-related issues pertaining to NHDP Phase -V and was expected to finalize its report by the end of March, 2006. The Committee expected that after finalization of the report further action would be initiated by theDepartment so as to commence the actual award of construction by the targeted date i.e., March 2007.

Expressways

11.108 The Committee recommended that the Department should formulate specific time frame for each stage of the six Expressways projects and take adequate steps to complete the projects well within the targeted date for completion. TheCommittee noted that as per the proposed phasing, these corridors were targeted for completion by December 2015. However, this was yet to be approved by the Government. The Committee expected that the target date for the completion ofthe proposed Expressways will be finalised at the earliest. Quality Control

11.109 The Committee felt that the instances of collapse of newly built or under construction National Highways was a cause of concern and it also leads to the delay in the timely completion of project, which in turn disturb the budgetaryestimates and planning. The Committee recommended that the recommendations contained in the reports of the InquiryCommittees should be utilized for avoiding faulty constructions in other projects. Besides exemplary action should be takenagainst the contractor, concessionaire and supervision consultants. The Committee also found confusion with regards to thenorms/guidelines for designing of roads in the country. The Committee also took exception to the fact that despite having built thousands of kilometers of Highways, no norms for designs of roads and bridges have been framed and internationalnorms are being followed. The Committee felt that there exists a need for indigenization of norms regarding designing of roads and bridges taking into account the local site conditions. The Committee also expected that the designs of roads andbridges executed by NHAI and other agencies should be strictly according to the local site conditions. Encroachment

11.110 The Committee felt that the encroachment of land under National Highways was a serious issue as it hampers the smooth development of highways and was also an irritant in the timely completion of various projects. The Committee recommended that suitable action should be taken to prevent encroachment in the first place. The Committee was surprisedto note that there was considerable delay in enforcing the Control of National Highways (Land & Traffic) Act, 2002. Further, the Presiding Officers for only two of eight National Highway Tribunals have been appointed so far. The Committee noted that the National Highway Administrations have been empowered to remove encroachments on NationalHighways under its jurisdiction and the power of appeal vests with National Highway Tribunal, which was the AppellateAuthority on all such matters. The Committee was of the view that the number of National Highway Tribunals (NHT) wasdisproportionate to the number of National Highway Administrations set up so far. The Committee, therefore, recommendedthat the number of National Highway Tribunals (NHT) should be increased and preferably one in each State should beopened. The Committee also recommended that the existing vacancies of Presiding Officers should be filled up at theearliest.

Central Road Fund

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11.111 The Committee noted that the issue of release of previous fund accruals to the Central Road Funds due to additional cess since 1.4.2003 still remains unresolved. However, the Committee was happy to note that the allocation ofcess had been increased from Rs.3269.74 crore in 2005-06 to Rs.6407.45 crore in 2006-07. The Committee also noted that the amount of additional cess was expected to be approximately half of the budget allocation for the year 2006-07. Therefore, the importance of the allocation to the Department from the Central Road Fund could not be avoided. TheCommittee recommended that the Department of Road Transport and Highways should take up the matter immediately withthe Ministry of Finance to resolve the impasse in the non-accrual of previous fund allocations from CRF in view of the highcost of implementation of National Highway Development Programme. The Committee noted that the pattern of distributionof accruals from CRF was not equitable and despite the enhanced allocation received during 2006-07, the share granted to State Roads and Centrally Sponsored Schemes were increased in comparison to 2005-06 and in case of Rural Roads, it was decreased from Rs. 3809.50 crore in 2005-06 to Rs. 3725.62 crore in 2006-07. The Committee strongly felt that this will have a negative impact on the rural economy and the majority who lives in rural pockets will suffer. Therefore, theCommittee recommended that the allocations should be made strictly in accordance with the percentages fixed in the CentralRoad Fund Act, 2000 wherein it was mentioned that 50% of the cess on High Speed Diesel oil was for the development ofrural roads implemented by Ministry of Rural Development.

Development of National Highways in North-Eastern Region

11.112 The Committee expected that taking into account the strategic importance and socio- economic condition of North Eastern region the Department will give special attention for the timely completion of the projects undertaken under thedifferent phases of SARDP-NE.

11.113 The Committee noted that the Department had now accepted that the viability of roads in the North Eastern region through private participation was generally low. The Committee, therefore, recommended that a suitable decision on the issue of viability gap funding of the private sector projects in the North Eastern region should be taken at the earliest so thatthe development of roads in that region do not suffer. National Highways (Original) Works

11.114 The Committee regretted to note that the outlay for Non-NHDP Projects had been decreased from Rs. 2277.00 crore in 2005-06 to Rs. 1550.30 crore in 2006-07 despite the fact that the utilization under this head during 2005-06 was 99.83% of the Revised Estimates provision. While it was understandable that there was a need for giving specific attention toNHDP works, the Committee felt that the Department should not ignore non-NHDP works, which contribute to the all round improvement of road infrastructure in the country. The Committee, therefore, recommended that the allocation toNon-NHDP Projects should be increased at Revised Estimates (2006-07) stage and the Department of Road Transport and Highways must explore the possibility of allocation of more funds to non-NHDP works in future. With reference to the restoration of roads hit by Tsunami and natural calamities the unprecedented rains in some parts of the country, theCommittee recommended that suitable financial assistance should be given to the affected States during the current financialyear also for early completion of the work.

Strategic Roads

11.115 The Committee noted that the allocation for strategic roads during 2005-06 was Rs.66.00 crore excluding Rs.5.00 crore for North Eastern States. As against this, the allocation in BE 2006-07 was Rs.63.46 crore excluding Rs.10.71 crore for the North Eastern States, which was a reduction in comparison to 2005-06. The Committee felt that the allocations specifically made for North Eastern States should be treated separately and should not be used to misinform the Committee. The Committee desired that the Department should furnish the details of the utilization of the funds during 2005-06 for all the identified strategic roads alongwith the proposed distribution of expenditure during 2006-07.

Externally Aided Projects 11.116 The Committee noted that the works on the projects in respect of which loan agreement were signed in the years2000 and 2001 are still pending. The Committee expressed its concern over the lackadaisical attitude of the Departmentover the implementation of the Externally Aided Projects. The Committee was also unhappy to note that the first installmentof the ADB loan was paid nine days beyond the due date not because of shortage of funds but due to lapse on the part of theconcerned officers, which exemplifies the non professional manner of functioning. The Committee felt that the default should be viewed seriously because country’s prestige was involved in international transactions and recommended that the Department should take suitable steps to prevent the repetition of such instances in future.

Maintenance and Repair of National Highways

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11.117 The Committee noted that against the total BE for 2006-07 of Rs.15307.31 crore for the Department of Road Transport and Highways, only an amount of Rs.814.38 crore had been earmarked for the maintenance and repair of National Highways. The Committee felt that the proportion of the outlay for maintenance and repair of National Highways to thetotal outlay of the Department of Road Transport and Highways was not upto the desired level in view of the lengths ofNational Highways completed so far and proposed to be added in the current financial year. The Committee recommended that in view of the bad conditions of various National Highways, which carry heavy traffic load, the Department should drawup a comprehensive list of high-density traffic National Highways which will enable it to utilize the available funds in a meaningful manner.

Road Transport

11.118 The Committee was unhappy to note that out of the budget allocation of Rs.16.00 crore during 2005-06 for the National Highway Accident Relief Service Scheme no fresh expenditure could be made and an expenditure of Rs.6.03 crorewas made on account of spill-over from the previous year. The Committee also noted that the allocation for this scheme during 2005-06 was almost half of the total allocation for road safety of Rs.35.30 crore. The Committee was appalled at the lack of foresight shown in making early alternate arrangements ahead of the expiry of the DGS&D contract. The Committee felt that the procurement of cranes in a routine manner without assessing the local requirements of the States also indicatesthe lack of farsightedness in implementing the scheme. The Committee noted that even though no fresh expenditure could bemade in 2005-06 out of the budget provision of Rs.16.00 crore, the budget allocation in 2006-07 had been decreased to Rs.14.80 crore. The Committee felt that the budget provision should have been increased for the current financial year. The Committee, therefore, recommended that suitable enhancement should be made in the budget allocation for NationalHighway Accident Relief Service Scheme so that the pending requests of States/UTs pertaining to the year 2005-06 and also the fresh requests for cranes/ambulances could be considered favourably.

11.119 The Committee was of the view that the steps being taken to constitute a Safety Directorate/Commissionerate forSafety, rather belatedly, are in the right direction. The Committee recommended that the preparatory steps in the directions should be completed within a stipulated time frame in view of the magnitude of the problem of high incidence of deaths onhighways and the urgent need to develop the necessary infrastructure to tackle the same.

11.120 The Committee was not satisfied with the response of the Department of Road Transport and Highways that issuance of licenses to untrained and incompetent persons was more of a problem of compliance with the provisions of MotorVehicles Act, 1988 and Central Motor Vehicles Rules, 1989 rather than the provisions themselves. The Committee was ofthe opinion that there was a need to revisit the relevant provisions of the Motor Vehicles Act, 1988 and Central MotorVehicles Rules, 1989 to rectify the driving license issuance system by prescribing stringent test conditions and rules andregulations. The Committee, therefore, recommended that there should be a comprehensive review of the existing rules andregulations pertaining to driving license issuance system to mitigate the problem of road accidents due to unsafe drivingpractices.

11.121 The Committee was surprised to note the lack of reliable data on road traffic and road accidents. The Committeewas at a loss to understand the manner in which the Department was implementing its road safety programmes in such ascenario. The Committee felt that this factor alone calls for concerted efforts to set up the SafetyDirectorate/Commissionerate for Safety at the earliest. The Committee was also of the opinion that NGOs/private sector canplay an active role in the crucial sector of road safety. The Committee recommended that suitable incentives should be offered to private sector to enhance their role in this field.

11.122 The Committee found that adequate pedestrian path had not been provided in the Delhi-Gurgaon Express Corridor Project. The Committee recommended that the norms relating to pedestrian safety should be strictly followed in all the road projects and that suitable modifications should be made in the above project to ensure safe movement of pedestrians. On theaspect of coordinating with the State PWDs on the issue of compliance of engineering standards related to road safety, theCommittee was surprised at the apathy shown by the Department in monitoring and rectifying the alterations made on theroads by State PWDs endangering road safety. The Committee noted that although the Department agreed that the raising of height of road dividers to 45 cms will be an accident hazard and therefore may lead to more accidents, it had shied away from its responsibility in ensuring the compliance of standards prescribed for road construction for promoting road safety. The Committee, therefore, recommended that a suitable mechanism should be put in place to co-ordinate with the State PWDs for the rectification of faulty constructions on roads that endanger road safety.

11.123 The Committee agreed that the maintenance of law and order was a State subject. However the fact that about 40% of the total road traffic was carried by the National Highways with the help of drivers/crew of truck etc. The Committeewas therefore of the opinion that the Department should continue to explore suitable alternatives for preventing the incidentsof highway robberies, hijacking of trucks, plundering of loads of vehicles, kidnapping and murder of drivers / crew of trucksetc. The Committee, therefore, recommended that the Department/National Highways Authority of India should make

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efforts to set up a dedicated task force to provide security on National Highways/sections of National Highways entrusted toit.

11.124 The Committee felt that the easy and quick accessibility of trauma centers/hospitals from National Highways willgo a long way in reducing the fatalities connected with road accidents. The Committee, however, agreed that the provision of immediate help to accident victims depends on the better coordination between various agencies. TheCommittee recommended that in addition to the Ministry of Health, the Department of Road Transport and Highways shouldalso make efforts to update the list of hospitals located in the vicinity of National Highways so that the patrolvans/ambulances can provide timely assistance to the victims of road accidents. The Committee further recommended that the Department should pursue the matter with the Ministry of Health for enhancing the financial assistance provided tohospitals/trauma centers located on the National Highways to upgrade their facilities. National Data Base Network

11.125 The Committee noted that the National Data Base Network was a sponsored project of the Department to bringabout uniformity in Driving License and Vehicle Registration documents issued by RTOs across the country. TheCommittee felt that the Department should closely monitor the implementation of the project in all the States and recommended that the Department should adequately sensitise the States about the necessity of having uniform policy allover the country in acquiring Driving License and Vehicle Registration documents as the first measure to check road accident-related deaths. The Committee further recommended that the Department should fix a target for each State so that the project was implemented during the Tenth Five Year Plan period itself.

Data Collection

11.126 The Committee was constrained to note that the entire amount allocated for data collection had remained unspent during 2005-06. The Committee was convinced that “importance of accurate data and well-researched insights to aid informed policy-making can not be overstated” accepted by the Department as a mere rhetoric and not supported by concreteaction. The Committee was of the view that the unorganised sector of road transport had remained a neglected area particularly due to lack of critical data relating to this Sector. The Committee recommended that suitable action should be taken to evolve a permanent mechanism to ensure collection and analysis of data relating to road transport sector which will be useful in research and development activities also.

Road Safety Equipment and Pollution Testing and Control

11.127 The Committee noted that Bharat Stage-II standards for vehicular emission had been made applicable through out the country w.e.f. 1.4.2005 and Bharat Stage III emission norms for four wheeled vehicles have come into force from 1.4.2005 in 11 mega cities. It was matter of serious concern that all the States have not implemented the Pollution UnderControl norms according to Bharat Stage-II norms even. The Committee recommended that there should be strict enforcement of the revised vehicular emission norms and the Department should also explore the possibility of institutingsome disincentives for the States, which are yet to implement the norms. The Committee also recommended that the process of issuance of Pollution Testing Equipments should be simplified so that the States/UTs can avail the scheme to the fullextent.

Model Driver’s Training School

11.128 The Committee noted that the Tenth Five Year Plan envisages the setting up of at least one Model Drivers’Training School in each of the five zones. The Committee felt that the functioning of Drivers’ Training Schools will have a direct impact on reducing the rate of road accidents and therefore was of the opinion that there was a need to setup at leastone such School in each of the States/UTs in view of the increasing number of vehicles in the country. The Committee recommended that the Department should formulate suitable schemes to encourage the States/UTs to setup such Schools andthat the procedure for setting up of such schools should be simplified and widely circulated. The Committee also recommended that the scheme should be liberalised to enlist the assistance of private sector also in this field in view of itsdirect impact on reducing the rate of road accidents.

Research and Development

11.129 The Committee was constrained to note that out of the allocation of Rs.4.85 crore for R&D in 2005-06, only Rs. 0.01 crore had been incurred upto December 2005. The Committee was of the view that the R&D activities are imperativeto enhance the sustainability of road projects being implemented in the country and to make them user friendly. TheCommittee felt that a non-utilisation of the budget provision during 2005-06 exemplifies the lack of efforts to bolster the

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R&D activities. The Committee also felt that there was a need to access the benefits derived from the R&D applications. The Committee expected that suitable institutional mechanisms will be developed to study the impact of R&D initiatives onspecific projects so that the beneficial results can be replicated in similar conditions in future. The Committee also expectedthat adequate steps will be taken for the progressive installation of Advance Traffic Management Systems and IntelligentTraffic Systems on the National Highways. The Committee further recommended that the GIS based National Highways Information Systems should be completed and implemented in a time bound manner.

Public Transport

11.130 The Committee was alarmed at the steep decline in the share of public transport vehicles in the total vehicles population from 11.1 % in 1951 to 1.1 % in 2003. The Committee was not aware of any concerted policy measureformulated to arrest this decline. In this context the Committee reiterated its observations/recommendations made in its 84th

Report, which was reproduced below:—

“The Committee expressed its concern that in the absence of user-friendly public transports, the people in the country are resorting to excessive use of private vehicles and this had put the roads under undue pressure. The Committee observed that most of the investment on roads was being extracted from the public itself but the returnsaccruing to the users are not equitable. The Committee, therefore, recommended that the efforts of the Government should focus on developing public transport, which discourage excessive use of private vehicles. The Governmentshould adopt a methodology, whereby, in the more densely populated states, the rich and the affluent are asked topay more for keeping more than one vehicle.”

Overloading

11.131 The Committee understands that the Indian Railways had adopted an aggressive marketing strategy for increasing its share of freight traffic. The Committee was at a loss to understand as to why there was no initiative to upgrade the designparameters of the roads commensurating with the technological advancement in the load carriers enabling them to bearhigher load capacities. The Committee was of the view that this had resulted in the flouting of provisions related to overloading. The Committee noted that the Department had held that the revenue likely to accrue on account of increase inGross Vehicle Weight will be accrued to the State Governments and Central Government will not get any part thereof. Further, on the one hand it was submitted by them that the likely increase in revenue was not possible to assess, on the otherhand it was claimed that the loss caused on account of the deterioration of roads would be much more than the revenue thatwould be gained by the State Governments. The Committee also felt that non-accrual of any revenue to the Central Government by way of road tax consequent on the increase in the permissible Gross Vehicle Weight should not be taken asan excuse to defer the decision on the suitable amendments to the Motor Vehicles Act, 1988. The Committee expected thatthe Department will either ensure the strict compliance of provisions of the Motor Vehicles Act, 1988 or consider theamendment in the Act to help the carriage sector.

National Road Transport Policy

11.132 The Committee was surprised to note that even though the Integrated Transport Policy was formulated in the year2001, the National Road Transport Policy had not been finalised so far. The Committee further noted that the discussions onthe draft National Road Transport Policy are still in preliminary stage and meetings with stakeholders are still to be held. Further, the agency to be entrusted the task of submitting a revised draft had not been finalised. In this scenario, the Committee was apprehensive that the National Road Transport Policy document will not be available by December, 2006 asenvisaged. The Committee recommended that concerted efforts should be made to finalise the National Road TransportPolicy expeditiously. In this context, the Committee had observed in its 84th Report that the absence of the right kind of modal-mix in the country was hampering optimum utilisation of all the resources. The Committee therefore reiterated its recommendations made in the same Report that the Government must come forward with an integrated transport policy tomake optimum utilisation of the various transport facilities available in the country.

11.133 The Committee was informed that recently the Ministry of Finance had issued instructions vide F.No.7/16/2004-IFU(B&A) dated the 8th December 2004 wherein it was impressed upon to all Ministry/Department that 67 per cent of the budgetary allocations should be spent upto December and rest of the 33 per cent of the budgetary allocations to be spent inthe last quarter ending March. However, ceiling of the budgeted expenditure cannot be observed in the Department of RoadTransport and Highways since most of the construction work starts after the monsoon season. The Committee noted that theproblem faced by the Department was very genuine as the most of the construction work starts after the monsoon and thus itwas not possible for them to spent 67 per cent of the budgetary allocations for the month ending December as per instructionsof the Ministry of Finance. The Committee, therefore, recommended that keeping in view of the climatic conditions of the

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country, the Department of Road Transport and Highways should be exempted from complying with the ceiling limits asprescribed by the Ministry of Finance above and the Department of Road Transport and Highways may be allowed to utilizetheir budget provision without any restriction throughout the year. (l) 103rd Report on the Demands for Grants (2006-07) of the Department of Culture The Tenth Plan Provisions and Annual Plan 2006-07

11.134 The Committee was of the view that fixing of the Revised Estimates ceiling by the Ministry of Finance on the basis of the level of expenditure attained upto the month of September/October creates problem for the Department of Culture. The Committee observed that most of the cultural functions and festivals take place in the month of October andNovember, after the monsoon. The Archaeological Survey of India also incurres major expenditure after the monsoon. The Committee, therefore, recommended that Government must review the budgeting procedure and evolve some mechanism to ensure that the Plan allocation for the Department of Culture was not reduced. The Committee recommended that if the review of the budgetary allocation was done in the month of December, instead of the month of September then the cut in thebudgetary provision could be avoided. The Committee observed that the major allocation for conservation work was being done under Non Plan Allocation. The Committee, therefore, recommended that conversation activity should be brought under the Plan Head so that conservation was not affected for want of funds, which was causing problem to the Departmentof Culture who wish to increase the conservation activities, hence need more expenditure. Archaeological Survey of India (a) Release of the revenue collected as admission fees to Archaeological Survey of India 11.135 The Committee felt that execution of conservation and preservation works need an expertise and timely funding of projects. But with its meager resource, it was difficult for the Archaeological Survey of India (ASI) to protect and maintainall the 3667 monuments/sites. The Committee, therefore, recommended that 100 per cent of the revenue collected as entryfees from ticketed monuments should be released to ASI for stepping up the activities and to augment resources of ASI. Coordinated efforts should also be taken by the Department to bring more monuments under central protection and alsoefforts should be made to raise the number of monuments for ticketing purpose to generate more revenue. The Committee strongly felt that there exists a requirement for creation of a non lapsable fund out of the amount generated by the ticketing of monuments which can be used for preservation and development of monuments in a dedicated manner. (b) The Post of Director-General in Archaeological Survey of India (ASI)

11.136 The Committee was of the view that there was no dearth of talent in the country. However, there was need to doaway the rigidity in the eligibility criteria for the posts of Joint Director General, ADG and then DG, ASI. The Committee hoped that the vacant post will be filled up at the earliest as promised by the Secretary during the course of his evidence. (c) Conservation and Preservation of Monuments by the ASI 11.137 The Committee was happy to note that more and more corporate houses are coming forward to help the ASI in conservation of monuments by way of contributions to National Culture Fund. The Committee recommended that the Department of Culture should continue its efforts to ensure more involvement of private sector companies/firms. But at the same time the Committee also cautioned that private involvement should not lead to commercial use of the monumentsputting their safety and sanctity at stake. 11.138 The monuments like Taj Mahal, Agra and Sun Temple at Konark which are famous all over the world and attract millions of tourists to the country should be conserved/preserved very carefully and the Archaeological Survey of Indiashould pay utmost attention towards this. The Committee recommended the Department to make adequate budgetaryprovision for this purpose. The Committee also recommended that the findings of the expert Committee on Konark SunTemple should be implemented immediately in order to enable this famous monuments survive. National Museum and Museum Security

11.139 The Committee agreed with the Department that Museum security was the major area of concern and thereforeenhancement of security arrangements was very much required. The Committee while recognizing the importance of security arrangements of National Museum also recommended that adequate steps should be taken to enhance the security of

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the State Museums also. The Committee considered that the cut imposed by the Finance Ministry at RE stage was unreasonable due to which modernization project of major museums in the country had to be postponed and some majorinternational exhibitions planed during the year could not be organised and recommended the Department to take up thematter with the Finance Ministry to avoid such cuts in future. National Archives of India

11.140 The Committee appreciated that the National Archives had undertaken computerization programme in a big way. However, the Committee was simultaneously disappointed about the fact that no much attempt have been made to acquiredocuments/manuscripts in the post independent era. The Committee expressed its dismay that despite being pointed out bythe Committee earlier the Department of Culture had also failed to fill-up the post of Director-General of Archieves. The Committee once again recommended that this post should be filled up without any further delay.

Library Sector (National Library, Kolkata and other Libraries) 11.141 The Committee observed that there exists a dire necessity to strengthen literary activities in the length and breadthof the country and for that purpose these leading libraries like, National Library, Kolkata, Raja Rammohun Roy Library andDelhi Public Library play a crucial role. The Committee recommended that the budgetary allocation made for these libraries should be spent in a time bound manner. The Committee further recommended that the Delhi Public Library should widenits scope of activities and timely purchases should be made in order to save this important public organisation fromlanguishing in neglect. Sahitya Akademi 11.142 The Committee observed that the Sahitya Akademi was the premier institution in the country for literary dialogue,publication and promotion of literature. The Committee recommended that the projected budgetary allocation was Rs. 10.64crore should be released to the Akademi. The Department of Culture should also ensure that the construction of the proposed office building was completed in time.

National School of Drama 11.143 The Committee expressed its happiness over the fact that the National School of Drama had been declared a ‘Deemed University’ under Section 3 of the University Grants Commission Act, 1956 and desired that with this the scope of activities of the School will be further broadened. Indira Gandhi National Centre for the Arts 11. 144 The Committee expressed its happiness over the fact that the National School of Drama had been declared a ‘Deemed University’ under Section 3 of the University Grants Commission Act, 1956 and desired that with this the scope of activities of the School will be further broadened. Science Cities 11.145 The Committee felt that holding back 60 per cent of the total budgetary amount i.e., Rs.12.00 crore out of total Rs. 20.00 crore, for Pushpa Gujral Science City was unjustifiable. More so, when the Pushpa Gujral Science City, Kapurthala was not in a position to utilize the same amount due to pending audit objections. Science City project which was very crucial for popularizing science amidst masses, therefore, the Committee recommended that the Department of Culture should give adequate emphasis to regional Science Centres at Dharwad, Raipur, Pimpri, Chinchwad , Pune as well as Sub-Regional Science Centres, at Solapur and Kalimpong and promote their activities further.

National Council of Science Museums, Kolkata 11.146 The Committee recommended that the budgeted amount of Rs. 16.00 crore will be utilized by the National Councilof Science Museums in a time bound manner so that it will not invite any cut from the Finance Ministry at RE stage thisyear. Zonal Cultural Centres

11.147 The Committee noted that Zonal Cultural Centres are playing important role to create cultural awareness among thepublic especially, in rural and semi urban areas. The Committee appreciated the efforts of the government to strengthen the

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Zonal Cultural Centres by enhancing the allocation successively. North Eastern Region

11.148 The Committee observed that proper utilization of the allocated budgetary amount was a major problem in all the North Eastern States. The Committee noted the special arrangements made by the Department to re-appropriate the amount from the NE Budget Head 2552 “Lump Sum Provision for the activities of North Eastern Region”, every quarter of the financial year for the expenditure incurred by various Divisions in respect of the schemes operated by them as also by theOrganizations which have undertaken the activities in the North Eastern Region, thereby incurring expenditure. As per this scheme the expenditure so incurred through will be re-imbursed at the end of each quarter. The Committee desired that this quarterly appraisal mechanism as devised by this Department to facilitate the monitoring of the progress of Plan/Schemes inthe North East Area and also the expenditure incurred thereon in that region will be implemented successfully. (m) 104th Report on the Demands for Grants (2006-07) of the Department of Tourism: Approach in the 10th Five Year Plan and Analysis of the Annual Plan 2006-07 11.149 The Committee noted that the plan allocation of Rs. 786 crore of Department of Tourism was not subjected to any reduction at RE stage during 2005-06. However, the Committee noted that during the year 2005-06, out of the budgeted allocation of Rs. 786 crore, the Department could spend Rs. 552.71 crore upto December, 2005 and the same was recouped to Rs. 772 crore by the end of the financial year 2005-06, which clearly indicates the poor fiscal management in theDepartment of Tourism. The Committee disapproves the tendency of spending funds desperately towards the end of thefinancial year especially, in the months of February and March. The Committee expected that the maximum amount of planoutlay would be utilized suitably and substantially during the first five months of the financial year so that the Departmentwill be in a position to make demand for more allocations of funds at RE stage for implementation of variousprojects/schemes of development of tourism infrastructure and promotion of tourism in the country. The Committeetherefore, recommended that the Department should evolve some mechanism of uniform utilization pattern throughout theyear so as to avoid incurring expenditure at the fag end of the financial year. 11.150 Taking into account the Actual Expenditure of 2002-03 to 2004-05 and Anticipated Expenditure of 2005-06 and BE of 2006-07, the Department of Tourism had been allocated approximate 91 per cent of the total outlay of Rs. 2900 crore for the 10th Five Year Plan. The Committee noted that the outlay for the annual plan 2006-07 was Rs. 830 crore which was short by Rs. 259 crore of the total budgeted outlay of Rs. 2900 crore for the 10th Plan. The Committee was of the view that the plan outlay was insufficient to explore the tourism potential available in the country and the Department of Tourism hadnot been allocated the budgeted outlay judiciously. The Committee felt that the financial requirements of the Department ofTourism was much more and expected that the plan outlays of the Department would be increased in the coming years. TheCommittee expected that Department of Tourism will also be able to utilize the enhanced allocation for effectiveimplementation of the schemes/programmes for development and promotion of tourism and also for creating world class anddependable tourism product and infrastructure required for sustained and structured tourism growth. The Committeerecommended that while revising allocations, due consideration should be given to the actual expenditure incurred in thepast. This way, the Department of Tourism will be in a position to make demand for more allocation of funds at RE stage. Product/ Infrastructure Development of Destinations and Circuits (a) Major Destinations and Circuits Development 11.151 The Committee was happy to note that Department of Tourism had been able to spend the entire amount available for development of infrastructure. The Committee was also happy to note that the Department of Tourism had finally decidedto concentrate on major destinations and major circuits as was being stressed by the Committee for long. The Committee agreed with the Department that amount of Rs. 8 crore per circuit and Rs.5 crore per destination was insufficient and recommended that the amount should be increased to Rs. 50 crore as suggested by the Department of Tourism. TheCommittee noted that the Department of Tourism had modified the pattern of funding to enable all States for improving theexisting products and developing new tourism products of world class standard. Now 100 per cent assistance was providedto State Governments/UTs for creation of infrastructure and other promotional projects and the State Governments have toprovide mainly land and external infrastructure. The Committee was of the view that if India had to realise its enormous potential in tourism, then it must provide exclusive world class tourism products and destinations to compete successfullywith other Asian tourism markets and the scope and reach of domestic tourism should also be broadened through thedevelopment of competitive destinations. The Committee also observed that arrival of foreign tourists was only 3.46 million, which was much less, in comparison to other countries in the world. The Committee, therefore, recommended the

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Department of Tourism to develop competitive destinations that match international standards in terms of price, quality andsatisfy the national and international travelers. Aggressive marketing efforts and publicity should be given to thesedestinations in order to create a niche market for Indian tourism products as well as to attract more tourists to thesedestinations. The critical infrastrucutral gaps can be bridged by creating a tourism development fund for augmenting largerflow of funds for development of tourism infrastructure. The Committee also recommended the Department of Tourism to create awareness about the environment impact of tourism with regard to the carrying capacity of tourist destinations. 11.152 The Committee noted that the major constraint in the expansion of international tourist traffic to India was non-availability of adequate infrastructure including accessibility to tourist destination and cultural/heritage sites. The Committeewas deeply concerned over the poor road connectivity of tourist destinations and circuits and cultural heritage sites. TheCommittee noted that Department of Tourism was also seized with the matter and appreciated the efforts taken by Department of Tourism for improvement of better road connectivity to these sites. The Committee observed that many of the tourist destinations are away from the National Highways and lack road connectivity of desired standard. The Committee recommended that Ministry of Shipping, Road Transport and Highways must be impressed about the proper roadconnectivity of all important destinations and circuits. However, preference may be given to World Heritage Sites andBuddhist Circuits where most of the tourists in general and foreign tourists in particular visit every year. In this regard theCommittee agreed to the suggestions of the Department of Tourism for making available fund from Central Roads Fund. 11.153 The Committee regretted to note that a large number of tourism projects sanctioned to State Governments/UTs by the Department of Tourism during the 8th, 9th and 10th Five Year Plans are still incomplete. During 8th and 9th Plans, 2526 projects were sanctioned and only 1761 projects were got completed and balance 765 projects remained incomplete for onereason or the others. The progress of work with regard to the 10th Plan period was also not very satisfactory. Out of the 895 projects sanctioned only 276 projects were got completed and there still remain a shortfall of 619 projects. The Committeewas apprehensive that with this slow pace of work the Department of Tourism will not be able to achieve the physical andfinancial targets. The Committee was of the view that Department of Tourism had failed to activate the State Government machinery which have resulted in such a huge mismatch in terms of projections and achievements. The Committee felt that if these projects were not completed in a definite time frame, then, the entire tax-payers money will go waste. In this regard, the active participation and support of the State Government was essential for tourism to bloom and spread its numerousbenefits among the host population. The Committee recommended the Department of Tourism to prioritize the projects andseek active support of the State Governments/UTs for the completion of the remaining tourism projects so as to avoid delayin the implementation of the projects as well as cost overrun. 11.154 The Committee noted with dissatisfaction that Department of Tourism had not evolved effective system or planning to systematically anticipate the actual requirement of funds otherwise, the investments could have yieldedcommensurating results. The Committee felt that strict monitoring was crucial for timely completion of any project and recommended that the monitoring agency should play rather proactive role and do away with the procedural hurdles fortimely completion of these pending projects so that the budgeted allocation was utilized optimally and utilization certificatesare issued in time. The Committee directed the Department to inform the Committee about the progress in the matter. (b) Rural Tourism

11.155 The Committee noted that the concept of rural tourism was the new emerging area under product/infrastructure and destination development scheme and aim to promote village tourism to spread tourism and its social-economic benefits to rural and its remote geographic regions. The Committee felt that rural tourism needs to be given impetus by earmarking funds for projects on the basis of a model plan for each State for the purpose and these villages should be taken up for prioritydevelopment and linked with the restoration of heritage properties in the area. The Committee was of the opinion that thiswould provide boost to local performing arts and help conserve the local culture apart from preventing rural-urban migration. The Committee recommended that local people in the rural areas should be encouraged to participate in tourism related projects in order to provide employment opportunity and to increase the income level in the rural areas. The Committee also recommended that proper training should be imparted on improvement of environment, hygiene and sanitation, etc. ascoordinated effort to develop rural tourism infrastructure.

Assistance for Large Revenue Generating Projects 11.156 The Committee noted that the Department of Tourism was providing support in the form of grant to Large RevenueGenerating Projects through the financial institutions and tourism finance corporations. It also noted that 10 projects likeTourist Trains, Cruise Vessels, Cruise Terminals, Convention Centres, Golf Courses etc. have been sanctioned by theDepartment of Tourism under the scheme. The Committee expected that these projects would be competed within thestipulated time frame though no target therefore have been communicated to the Committee. The Committee was constrained to note that only an amount of Rs. 9.28 crore could be spent by the end of December, 2005. The Committee

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hoped that the Department will be able to utilize the amount of Rs. 30 crore allocated for the current year. However, the Committee felt that the allocation was meager when grants-in-aid for one project itself can go up to 50 crore. The Committee felt that there was a need for higher level of participation by the private sector in all the stages of the tourismdevelopment as the growth in tourism sector can only be achieved by major flow of investments coming in from privatesector and public investments can act as a catalyst. The Committee recommended that private sector investment should beenhanced by removing the impediments to the growth of tourism and expediting policy support. The proposal for inclusionof special trains like “Palace on Wheels” and “Deccan Odyssey” should also be considered in collaboration with the concerned State Governments for improving the connectivity and urban infrastructure in Buddhist sites. The Committee also recommended that while identifying the projects under the Public Private participation, the strategy for removing regionalimbalances should also be taken care of. Capacity Building for Service Providers 11.157 The Committee noted with dismay that there was a heavy shortfall in the utilization of funds allocated under thehead “Capacity Building for Service Providers” and the Department of Tourism had not furnished any reasons for under utilization of funds. It appeared to the Committee that while revising allocation, little consideration was paid to the actual expenditure incurred in the past and expected the Department of Tourism to utilize the funds more judiciously during 2006-07. The Committee noted that the Capacity Building for Service Providers Scheme provides training through one to five day modules to persons who are working in unorganised sectors and who come into contact with a large number of tourists likethose working in small hotels, dhabas, ticketing agents, travel agencies, police personnel etc. The Committee desired the Department of Tourism to prepare broad framework for the countrywide training programme to develop Human Resourceand place them with important groups of service providers engaged in the tourism industry. (Para 41)

Assistance to Hotel Management and other Institutes for Human Resource Development 11.158 The Committee noted that hotel management and catering education programmes assumes high priority with a view to the modernization and expansion of the country's hospitality industry and impressive tourism growth anddiversification of tourism activities. The Committee was happy to note that as per its earlier recommendations, theDepartment of Tourism had proposed to set up four new IHMs at Dehradun, Jamsedpur, Kurukshetra and Raipur during the 10th Plan. The Committee was of the view that human resources development efforts cannot depend indefinitely onGovernment funding in the wake of restructuring of the economy. A funding system should be set up to ensure continuationof activities and private sector could contribute more training efforts. The Committee observed that a majority of Institutes operated by the Department of Tourism have attained self-sufficiency in meeting the revenue expenditure and therefore, recommended that as there was greater demand of professionally trained manpower in the sector to cater to the growingdemand in the service sector, a good number of accredited institutes should be set up and the training course run by theseinstitutes should be designed to suit the needs of various target groups also. 11.159 The Committee noted that a number of private IHMs have emerged in the country to offer courses in hotelmanagement and they have grown to play a significant part in country’s hotel management. However, the Committee was surprised to note that there was no guidelines for affiliation of the private institutes of hotel management in the country due towhich these institutes have varying standards and are lacking in training and other infrastructure facilities. The Committee recommended that the guidelines for affiliation of these privately managed institutes be notified at the earliest for achievingexcellence in the tourism sector and the Department of Tourism should grant a statutory/deemed university status to NCHMTfor better regulation, management, monitoring and coordination of public and private sectors in the hospitality education. Domestic Promotion and Publicity including Hospitality 11.160 The Committee was unhappy with the poor performance of Department of Tourism with regard to low utilization of approved outlays for the domestic tourism and publicity. Out of the total allocation of Rs. 230 crore for the 10th Plan, the Department of Tourism could spend Rs. 71.88 crore upto December, 2005 leaving thereby a huge shortfall in the utilisationpattern. The Committee was of the view that the Department of Tourism had full responsibility to ensure proper utilisationof the approved outlay and recommended that the Department of Tourism should take all corrective measures based upon theactual requirements for maximum utilisation of budgeted amount during 2006-07. 11.161 The Committee noted that due to increase in income level and emergence of the dynamic urban middle class, the potential of domestic tourism had grown substantially. In the country for every international tourist there are 80 domestictourists but surprisingly there was no precise estimate of the domestic tourist traffic in the country. During the year 2004, anestimated 367 million domestic tourists travelled the country showing a positive growth rate of about 19% as compared to309 million in the year 2003. The Committee was of the view that the domestic tourism was the foundation of a viable andsustainable tourism industry and much of the growth of global tourism had been generated by the domestic tourism. The Committee observed that the potential for domestic tourism was massive and required focused approach in all arena

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especially on creation of tourism infrastructure and promoting amenities and facilities including marketing support for thebudget tourists segment. The Committee recommended the Department of Tourism to evolve some mechanism for preciseestimation of the domestic tourist traffic in the country and provide strong support to tourism sector for creation of largeinfrastructure besides launching mass tourism awareness campaign and publicity material especially focussing the newlycreated tourists destinations and circuits. This was imperative in view of the fact that domestic tourists have started looking atand exploring their own country with renewed interests. 11.162 The Committee also recommended that as the variety of fairs and festivals are a powerful tools for showcasing the Indian culture for the tourists and generates income and employment and these events are viewed with interest and curiosityby domestic and foreign tourists, the Department of Tourism must support and lay special attention on domestic publicityand marketing of these products. (Paras 55, 57 and 58) Overseas Promotion and Publicity including Marketing Development Assistance 11.163 The Committee noted that though allocation for overseas promotion and publicity had been enhanced considerablyduring the year 2005-06, still there was a significant gap between the expenditure of the Government of India and the worldaverage expenditure. The Committee opined that promotion and marketing was an important component of tourismdevelopment and needs to be undertaken along with the consumer profiles and product characteristics. The Department ofTourism through its 13 Indiatourism overseas offices endeavour to position India as a preferred tourism and business destination and to increase India's share of the global tourism market. The Committee recommended that Department of Tourism should develop and implement cost effective marketing strategies based on market research and analysis in each ofthe tourist generating countries to position India as a global brand and reinforce 'Incredible India' campaign as a unique and preferred tourism destinations. 11.164 The Committee noted that international tourism was still relatively concentrated in the industrialized countries of Europe, the America and Asia and the Pacific. However, with rising levels of disposable income, many emerging economies have shown fast growth particularly in Central Europe, North-East and South East Asia and middle East. The Committee was of the view that with the enhancement of budget of Indiatourism offices overseas, aggressive promotional activitiesshould be carried out in emerging markets like China, Korea, Taiwan etc. The Committee recommended that promotionalactivities should be identified in tourists generating overseas markets to increase the visibility of Indian tourism products andto promote India as a tourist destination in emerging markets particularly East Asia and South East Asia. National Tourism Promotion Board 11.165 The Committee noted that Department of Tourism being the nodal agency for development of tourism in the country requires close coordination and interaction with various Ministries/Departments, State Governments and private sectorplayers for integration of policies and to mobilize the State Governments and private sector for development of unique andcompetitive tourism products and destinations. The Committee felt that the Department of Tourism had tended to concentrate largely on its role as a promoter of tourism and generator of foreign exchange earnings and paying less attentionsto inter sectoral policy coordination. The Committee observed that though the Government have established several forums/mechanism for inter-institutional coordination and the Department of Tourism was also seized with matter of setting up of National Tourism Promotion Board, the tourism was still at the appalling state of coordination. The Committee desired the Department of Tourism to redefine and expand its role and work toward inter-sectoral convergence and policy integration.

Uniformity and Rationalization of Taxes on Transport and Hospitality Sector 11.166 The Committee noted with serious concern that a multiplicity of taxes exist in the tourism sector and the quantumof taxes also varies from place to place. The Committee felt that high and multitude of central and state taxes create hurdlesin packaging of tourism product and makes the product expensive as well. The Committee felt that there was a need for introduction of new incentives to increase tourism expenditure, volume and promotion of investment in the industry. TheCommittee desired that attempt should be made to reduce the heavy and multiple taxes that reduce the competitiveness of the our tourism product and recommended that taxes like expenditure tax, service tax, customs duty and taxation of Aviation Turbine Fuel (ATF) and luxury tax at State level should be rationalized and reduced for end customer to make the destinationcompetitive and some uniformity in taxes on tourist transport should be adopted to facilitate free flow of tourist traffic acrossthe state borders. Shortage of Hotel Accommodation 11.167 The Committee was concerned with the shortage of hotel accommodation in all categories particularly the budget hotels which does not auger well at time when more and more foreign tourists are coming to India particularly

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Commonwealth Games was scheduled to be held in New Delhi in 2010. The Committee noted that the Department of Tourism was augmenting the hotel room capacity commensurate with the growth in the tourism sector. The Department ofTourism had taken up the matter for creation of infrastructure with the State Governments and other land owning agencieslike Ministry of Civil Aviation, Railway and DDA for creation of land banks, allocation of hotel sites on revenue sharingbasis and provide additional FSI/FAR and a capital subsidy scheme as an incentive for accommodation infrastructure inbudget hotel was also on an offing. The Committee recommended the Department of Tourism to take step to ensure thatmore budget hotels are set up by making sites available on central Government land in order to maintain country'scompetitiveness as a tourist destination and facilitate identification of hotel sites and their allocation by State Governments tothe deserving entrepreneurs with facilities for speedy single window clearance through various Government agencies.

Approval and Classification of Hotels 11.168 The Committee noted that the approval and classification of hotels under the star system from one to 5 star deluxe and heritage was being done by the Department of Tourism for the suitability and standardising the service for internationaltourists. The Committee observed that mandatory norms have been laid down for the purpose and there were 1934 approved hotels with 103973 rooms in the country till the end of December, 2005 and classification of 50 numbers of hotelswith 5125 rooms was pending with the Department. The Committee felt the hotel accommodation remain a vital area of concern and pendency in the classification of hotels was not desirable. The Committee recommended the Department ofTourism to speed up the process of classification/reclassification of hotels at an early date. The Committee alsorecommended that India will host 12th Commonwealth Games in Delhi in the year 2010 and accordingly the Department should play a proactive role in meeting extra demand for good quality hotel rooms.

Cruise Tourism 11.169 The Committee noted that the Government had constituted a high powered steering group to formulate cruise shipping policy in the country and a draft policy paper on development of cruise shipping was under finalization. TheCommittee also noted that five major ports Mumbai, Murmugao, New Manglaore, Kochi and Tuticorin have been identified for development of infrastructure and other related facilities for the growth and expansion of cruise tourism in the countryand the Department of Tourism was also in the process of making publicity material and marketing India as a cruise destination. The Committee recommended that besides the ports on West Coast, the Department of Tourism should identifyports on the East coast in the country including Andaman & Nicobar Islands for development of major cruise destinations,which also have exotic appeal.

Medical Tourism 11.170 The Committee noted that medical tourism was new emerging area with a high potential for growth. The Committee observed that the health tourism was not season specific and the average length of stay of a person coming as health tourist was generally long depending upon the medical procedure. The Committee noted that the Government hadintroduced medical visa to facilitate foreign tourists coming to India for medical treatment. The Committee hoped that low cost of medical treatment, high level of expertise and varied system of medicines of India are factors that can lead to a boost in health tourism in the country.

Beach Tourism 11.171 The Committee noted that the concept of Beach Tourism was fast emerging and growing in the country. TheCommittee observed that for development of beach tourism, the Department of Tourism had extended the financial supportto a number of sites on the west coast of India and a study for an integrated sustainable development of coastal tourism in theStates of West Bengal, Orissa and Andhra Pradesh had already been undertaken and a comprehensive coastal tourism policyfor these States was under consideration. The Committee felt that development of beach tourism along the coastal lines ofthe country will certainly give impetus to the cruise tourism and recommended the Department of Tourism to identify anddevelop more beaches both on the West and East coast in the country with active participation by private sector and duepublicity should be given for developing these beaches as a major tourists attraction. Adventure Tourism 11.172 The Committee noted that geographical diversity of our country provides opportunities for out door and adventuresports activities for all tastes and interests and every level of experience. The Committee also noted that major adventuretourism activities range from trekking and skiing in the Himalayas, river rafting along the Ganges, water sports in Goa, troutfishing in Himachal Pradesh and U.P., heli skiing in Himachal Pradesh and wind surfing, scuba diving and yatching in the

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Andaman and Lakshadweep Islands. The Committee felt that there was a need for regulation and promotion in the countryof adventure tourism products. The Committee therefore, recommended the Department of Tourism to better regulate andpromote the adventure tourism assets in the country especially the mountain based and water sports adventure activitiesamongst the youth and introduce the minimum standards of safety and conservation for tour operators. (Para 110)

Development of Tourism in North-Eastern Region

11.173 The Committee noted the efforts taken by the Department of Tourism for promotion of tourism in the North-Eastern States. It also noted that a nation wide special campaign 'paradise unexplored' had also been launched for promoting and marketing of various tourism products in the North Eastern region. However, the Committee was constrained tonote that in spite of the concerted efforts of Department of Tourism the flow of tourist traffic to these regions were marginal and was being largely hampered by Restricted Area Permit, Protected Area Permit and Inner Line Permit and lack of suitableinfrastructure and other related facilities and amenities in various tourists places in the region. The Committee observed that in spite of incurring a lot of expenditure for development of tourism in North-East region no perceptible improvement was seen in the ground situation and Department of Tourism had to put lot of efforts to fully explore the tourism potential inthe Region. Further, the revenue earned from tourism is not estimated by the States. The Committee, therefore,recommended the Department of Tourism to prioritize the projects in consultation with the State Government for upgradationand creation of infrastructure and destinations in the Region besides addressing the major issues for the growth anddevelopment of tourism in the Region like mandatory permit system, law and order situation and lack of private investmentetc. This way, the Department of Tourism will be able to bring the North Eastern Region in the mainstream of nationaldevelopment agenda. 11.174 The Committee also recommended the Department of Tourism to keep an account of the revenue earned from tourism in these States, as it will give economic benefits of tourism in the form of its contribution to Gross DomesticProducts (GDP) and employment. (m) 105th Report on the Demands for Grants (2006-07) of the Department of Shipping:

Analysis of Annual Plan 2006-07 11.175 The Committee noted that in the annual plan 2005-06, the outlay of Department of Shipping was reduced from Rs.2419.66 crore to Rs. 2333.71 crore at RE stage. The reduction had been both in the Gross Budgetary Support as well asIEBR component. As far as the reasons for under utilisation of funds was concerned, the Committee found that inadequatepreparedness on the part of executing authorities and procedural rigidity for approval of scheme are main culprits for underutilisation of funds. Therefore, the Committee recommended that Department of Shipping should not only away with theprocedural hurdles leading to delay in processing and approving the scheme but also adopt proactive approach while preparing the scheme. In BE 2006-07, an outlay of Rs. 3263.19 crore had been provided which consists of a Gross Budgetary Support of Rs. 740.88 crore and IEBR of Rs. 2522.31 crore, which was almost 40% over and above the amount of Rs. 2419.66 crore allocated in BE 2005-06. The Committee expected that the increase in the plan outlay will have a positive effect on the schemes/projects of the Departmentof Shipping. The Committee was of the view that complete utilization of the enhanced allocation will help effectiveimplementation of the schemes/performances undertaken by the Department of Shipping. The Committee recommended thatthe Government should increase the outlay of Department of Shipping and if need be, supplement the allocation byincreasing the Gross Budgetary Support to the Department of Shipping. Port Sector 11.176 The Committee was not satisfied with the reasons given by the Department of Shipping for shortfall in theutilisation of the approved outlay and felt that the reasons could have been anticipated in advance by the Department of Shipping, this clearly shows the lack of pro-active approach on the part of the Department. The Committee was perturbed to note that there had been a huge shortfall in the utilisation of Funds vis-à-vis approved outlay for the Port Sector. In BE 2005-06, an outlay of Rs. 1163.75 crore comprising of Rs. 280.24 crore Gross Budgetary Support and Rs.883.21 crore IEBR was provided for thePort Sector. As against this, the actual expenditure was anticipated to be Rs. 668.33 crore. The Committee felt that while proposing the Plan Outlay, the Department of Shipping had not done the strategic planning and observed that there was a mismatch in the physical and financial projections, which was not explicable. The Committee, therefore, recommended that Government should evolve a monitoring mechanism to ensure proper utilisation of the approved outlay, making officialsaccountable for failure, transparency in implementation process logistical coordination and do away with the proceduralrigidities to avoid delay and cost overrun so that the budgeted outlay was utilised optimally.

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Capacity Enhancement in Major Ports

11.177 The Committee noted that the Department of Shipping was implementing the schemes for enhancing the capacity and productivity of all major ports and to encourage the private sector participation for the development of portsinfrastructure and accordingly, comprehensive policy guidelines have been issued. The Committee also noted that theGovernment had allowed cent percent FDI for construction and maintenance of ports in order to mobilise substantialresources as well as to improve efficiency, productivity and quality of services of Ports. The Committee, however, observedthat as against the capacity of 408.60 million TPA, the major ports handled a total traffic of 310.80 mt. upto December 2005. This way, the aggregate capacity of major ports exceeds the traffic target marginally. Therefore, there was need to increasecapacity of ports on urgent basis. The Committee, therefore, recommended the Department of Shipping to take action for development of infrastructure in major ports so as to face global competition of sea-borne trade and enhance private sector investment including FDI in the sector by addressing the procedural rigidity expediting well-integrated and coordinated policy framework and approach.

Port Labour Reforms 11.178 The Committee noted that in the changed fiscal regime the Government was committed for labour reforms and desired to allow private sector investment for creation and augmentation of capacity building in the port infrastructure. TheCommittee also noted with concern that enhancement of private sector investment for development of port infrastructure maydeter the interest of employee's unions/federations. Therefore, the Committee felt that the port labour reforms are necessary before exposing the labour sector to open market mechanism. In view of this, the Committee recommended the Department of Shipping to de-regulate and de-centralize the commercial environment for collective bargaining to improve theproductivity levels at ports while taking adequate care of labour interests. Port Connectivity

11.179 The Committee observed that the lack of proper port connectivity had hampered the development of ports. The Committee also noted that projects involving 117.73 km. for improving road accessibility to Ports have been completed andprojects involving 313.85 kms. of road length are under implementation. The Committee was of the view that development ofother modes of transport viz. railways, highways and inland water transport was also essential for improving the accessibilityto ports and to keep pace with the growing requirements of overseas trade. The Committee felt that the availability of such modal mix will result in considerable saving in cost and time for cargo containers assessing these ports. The Committeetherefore, recommended the Department of Shipping to take steps for better road and rail connectivity infrastructure in allthe major ports for the growth of the container cargo. The cost of connectivity could be shared in public sector by thestrategic partners or alternatively, the private public partnership (PPP) or joint venture partnership (JVP) could also beexplored.

Containerization in Major Ports

11.180 The Committee observed that the international trade was witnessing an increasing trend towards containerization. However, the Committee was constrained to note that the major ports did not significantly contribute to export-import trade and about 70 per cent of containers are trans-shipped at neighbourhood international Ports such as, Colombo, Dubai and Singapore Ports, making thereby India's export costlier and imports less competitive. The Committee, therefore, recommended that Government should establish hub ports in the country preferably, in East and West Coast for trans-shipment of containerized cargo for the growth of sea-borne overseas trade and economic development. Sethusamudram Ship Channel Project 11.181 The Committee noted that the Sethusamudram Ship Channel Project envisages dredging of a ship channel toconnect Gulf of Mannar and Bay of Bengal to Palk Bay and will save upto 422 nautical miles of distance and 30 hours ofsailing time for ships between East and West Coast. The Committee also noted that the project had a host of benefits for the Coastal District of Southern States and was of great economic and strategic importance. The Committee also noted that thereare protests from many corners regarding the environmental repercussions of the Sethusamudram Ship Channel Projectwhereas, the Committee felt that the project would generate employment opportunity by developing three fishing harbours in the project area for the benefits of the fishermen. The Committee expected that the Department of Shipping will also givedue consideration for environmental related issues as a part of the implementation of the Sethusamudram Ship ChannelProject. National Maritime Development Programme

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11.182 The Committee noted that the Government had formulated an ambitious National Maritime DevelopmentProgramme with the aim to cover the entire gamut of activities in the maritime transport sector including major ports,shipping and inland waters transport. The Committee also noted that a total number of 387 projects (276 for major ports and111 for shipping and IWT Sector) had been identified for implementation with the total investment of Rs. 1,00, 339 crore, out of which Rs. 55,804 crore had been earmarked for major ports and the balance Rs. 44,535 crore had been reserved for shipping and IWT Sector. The Committee felt that the formulation of the programme will not only add to the creation andupgradation of the infrastructural facilities but also helps in augmenting the capacity expansion of the port network, inlandwater transport sector as well as the growth of the tonnage. The Committee, therefore, recommended that for the successfulimplementation of the programme activities, the Department of Shipping should develop and add the infrastructure forcapacity building both in terms of human resources, technology upgradation as well as research and development. TheCommittee also recommended that the Department should take action for setting up of National Maritime Development Authority on the pattern of National Highway Authority of India.

Extending Tonnage Tax Benefit to Inland Vessels and Coastal Vessels 11.183 The Committee observed that the Inland Water Transport and Coastal Vessel Transport in our country had not been optimally developed to compete with other modes of transport in the country and require fiscal support. However, theCommittee was constrained to note that the Vessels registered under the Inland Vessels and Coasting Vessels Acts have notyet been extended the benefit of Tonnage Tax. To aggrevate the situation the benefit of Section 33AC of Income Tax Act had also been withdrawn in the finance bill 2004-05. However the extention of Tonnage Tax benefit to these Vessels wouldonly result in revenue loss of Rs.1.5 crore per annum to the exchequer, as these Vessels have tonnage on only 0.03 millionGRT. The Committee, therefore, recommended the Department of Shipping to vigorously pursue the matter with the Ministry of Finance for inclusion of the Vessels registered under Inland Vessels & Coastal Vessels Acts under the tonnagetax regime so as to unfold the infrastructure potential of IWT sector with the growth of the Indian economy. Calcutta Dock Labour Board 11.184 The Committee noted with anguish that a proposal for release of one time grant of Rs.733.28 crore to CalcuttaDock Labour Board was pending for a long time but had not yet been approved. The Committee was of the view that it was the liability of the Government to pay the pension and the pensionary dues in time and it will be solely discriminatory on thepart of the Government to withhold the pension and pensionary benefits of the employees of the Calcutta Dock LabourBoard. The Committee was unable to comprehend as to how these pensioners will sustain in the absence of any financialsupport. The Committee felt that the injustice was being meted out to the pensioners of the Calcutta Dock Labour Board in the disbursement of pension and pensionary benefits, although an Act of Parliament had created the Board. The Committee felt that inspite of the recommendations in earlier Reports also nothing had been done in the matter. The Committee, therefore, once again recommended that every effort should be made by the Department of Shipping for release of one timegrant to meet the pensionary liabilities of employees of the Calcutta Dock Labour Board. Misappropriation of Seamen's Provident Fund 11.185 The Committee had taken up the matter of misappropriation of Seamen's Provident Fund in its earlier reports also. The Committee however, was not happy with the lethargic approach of the Government in the matter. The Committee notedthat the matter to recoup the shortage of Rs.92.78 crore in Seaman's Provident Fund was being looked into by the Group ofMinisters. The Group of Ministers had sought certain clarifications from the Department of Shipping. The Committee recommended the Department of Shipping to provide the requisite information to Group of Ministers to enable them to takean early decision. The Committee would like to be apprised of the action taken in this regard. Indian Institute of Maritime Studies 11.186 The Committee felt that the university once created will not only augment the training facilities but also provideboost to the quality education in the field of Marine Training. The Committee noted that the draft Cabinet Note on theformation of Indian Maritime University had been circulated for inter-Ministerial consideration and after their comments, the proposal will be sent for consideration of the Cabinet. The Committee expected that the Cabinet will soon take a decision onthe formation of the Maritime University in the country to facilitate the Department of Shipping to introduce a Bill in theParliament.

11.187 The Committee, however, expressed its concern over the delay for establishment of Indian Maritime University. The Committee recommended the Department of Shipping to take steps to establish the Maritime University under a Central Act in a time bound manner and adequate provisions for creation of pension fund and finalisation of terms and conditions for

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the absorption of employees of Indian Institute of Maritime Studies should also be made.

Central Inland Water Transport Corporation 11.188 The Committee expressed its displeasure over the manner in which the matter of CIWTC was being handled by the Government. The Committee felt that CIWTC can play an important role in development of the Inland Water Transport.The Committee observed that although substantial investment had been made for the infrastructure development in Inland Water Transport Sector but, still it was not a viable option and therefore, participation of private sector in utilisation of theinfrastructure was insignificant. The situation demanded the bigger role of CIWTC as a lone-operator in the longer stretch of waterways. The Committee desired that till such time the infrastructure of IWT be fully ready for operation, the CIWTCwith its existing infrastructure, capacity and manpower may be allowed to function for bridging the gap of development ofIWT sector. (Para 60) Inland Water Transport 11.189 The Committee observed that the Government was giving step-motherly treatment to the Inland Water Transport Sector and this approach was reflected in the pattern of budgeting as well as utilization of funds in the IWT Sector. TheCommittee was dismayed to note that an outlay of Rs. 150.00 crore was allocated in BE 2005-06 for the IWT Sector but it was reduced to Rs. 101.25 crore at RE stage and an expenditure of Rs. 47.87 crore was made only upto February 2006. TheCommittee noted that Inland Water Transport was one of the oldest, economically, environmentally sustainable mode oftransport but the potential of Inland Water Transport remains largely unexploited due to the detrimental policies of theGovernment. The Committee observed that although the Department of Shipping was committed to step up the share of IWT in the country's total trade still this sector remains under developed at present for want of requisite infrastructure andtherefore, was not viable for commercial operations. The Committee felt that inadequate policy support, interest and investments are some of the factors which are aggravating the problems of the Inland Water Transport and this sector wasloosing a competitive edge with other modal mix in the country. The Committee was of the view that growth of the InlandWater Transport sector will entirely depend upon the quantum of investments, made through public-private partnership and a multi-dimensional approach for creating the required infrastructure primarily through Government Support. The Committee, therefore, recommended the Department of Shipping to provide some institutional framework for creating a vibrant Inland Water Transport sector in the country and IWT should be included under the National Maritime Development Programme foraugmentation of IWT fleet, creation of inter-modal linkages and upgradation of cargo handling technologies etc. (n) 106th Report on the Demands for Grants (2006-07) of the Ministry of Civil Aviation: Assessment of Annual Plan 2005-06 and Allocation for 2006-07 11.190 The Committee was happy to note that the Ministry had taken due cognisance of its earlier recommendations pertaining to utilisation of budget allocations and had made efforts to improve the earlier situation of consistent underutilization of funds. The Committee noted that barring the low proportion of expenditure of Pawan Hans HelicoptersLimited, the anticipated expenditure in respect of other organisations was satisfactory vis-à-vis the approved allocations. TheCommittee, however expressed its concern that the Gross Budgetary Support had been reduced from Rs. 370.85 crore in 2005-06 to Rs.130.00 crore in 2006-07. The Committee expected that the targets set for internal and extra budgetaryresources as well as external commercial borrowings from foreign banks/financial institutions for bridging the gap inbudgetary support will materialize. The Committee recommended that the Ministry should take adequate steps during 2006-07 also to ensure optimum utilisation of the enhanced allocations made to various organisations. Air India Limited 11.191 The Committee noted that the outlay for non-aircraft projects was an important component of the budget provisionfor Air India Limited as the programmes/projects undertaken thereunder viz. purchase of Ground Handling Equipments, Engineering Workshop Equipments, Security Equipments, Aircraft Refurbishment Programme etc. are aimed at enhancingthe operational efficiency. The Committee expected that the allocated funds would be fully utilised during 2006-07 and recommended that the Ministry should take suitable steps to ensure that the operational efficiency of Air India Limited wasnot compromised for want of funds. 11.192 The Committee noted that Air India had been reporting net profits consistently since 2001-02 and expected that this healthy situation will continue. The Committee recommended that the Ministry should endeavour to focus on all the individual parameters that enhance the overall operational performance with the available aircraft capacity till new andmodern aircrafts join its fleet.

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11.193 The level of Passenger Load Factor had a direct impact on the profit/loss balance sheet. The Committee, therefore,recommended that Air India should adopt aggressive marketing strategies to improve its Passenger Load Factor to the desiredlevel. The Committee also recommended that the bilateral air services agreements should be leveraged to diversify the international air services and to avail the entitlements of new traffic rights to the full extent. 11.194 The Committee noted that important announcements have been made in the Annual Supplement, 2006 under theForeign Trade Policy 2004-09, which inter-alia, will enable the country to offer competitive fuel prices and attract mid route stops for international flights and they are likely to play a catalytic role in the growth of civil aviation sector. The Committee recommended that the Ministry should pursue the matter regarding the issuance of notifications specifying the scope andextent of concessions/exemptions with the Commerce Ministry/Finance Ministry for deriving the anticipated benefits fromthe announcements made in the Annual Supplement, 2006 under the Foreign Trade Policy 2004-09. The Committee further recommended that the Ministry should initiate suitable steps in advance to facilitate the National Carriers to avail the fullbenefits of the announcements. 11.195 The Committee noted that Air India had approached only M/s. Jet Airways in July, 2005 to negotiate the wet-lease of one A340-330E aircraft. The Committee was of the opinion that Air India could have approached other Airlinesorganisations. The procedure followed by Air India was against the practice of open competitive tendering process andtherefore lacks transparency. The Committee felt that the impending shortage could have been anticipated early had therebeen a constant assessment of the available aircraft capacity. The Committee further recommended that adequate contingency plans should be prepared including standing arrangements for lease of aircrafts during exigencies by followingthe proper tendering process. Indian Airlines Limited 11.196 The Committee noted that there was a scope for further improvement in the overall load factor of Indian Airlinesand recommended that there was a need to focus attention of all the factors that are responsible for acting as constraints inthe achievement of the desired level of overall load factor. The Committee also noted with concern that the market share ofnational carriers had decreased despite the overall increase in the growth rate of domestic passengers traffic, which was also reflected in the decline in the reported profits of Indian Airlines. The Committee recommended that adequate steps, in addition to the acquisition of aircrafts, should be taken to enable Indian Airlines to tap the market opportunities in thedomestic as well as international markets. 11.197 The Committee felt that the issue of wage revision of employees of Indian Airlines had been pending for a long time. In this connection, the Committee would like to draw the attention of the Ministry to the recommendations made by theCommittee in its 96th Report, which was reproduced below: -

“The Committee expressed its anguish over the evasive comments of the Ministry offered in response to the recommendation of the Parliamentary Committee. The Committee was extremely unhappy about the lackadaisicalapproach of the Ministry on the issue of revision of scales of pay of employees of Indian Airlines. The Committeewas of the view that the satisfaction level of the personnel in the matter of service conditions was a major factoraffecting the performance of any organisation. The total inaction on the part of the Ministry in the matter of payrevision of employees of Indian Airlines was surprising, especially in the present age of poaching and stiffcompetition by other Indian scheduled carriers. The Committee, therefore, reiterated that the Ministry should expedite its decision in the matter in the overall interest of the employees and the organisation.” The Committee once again reiterated the above recommendation and expected an early action thereon.

Acquisition of Aircrafts by Indian Airlines Limited & Air India Limited 11.198 The Committee expected that the Ministry would take necessary steps to ensure that the time schedules fixed forthe delivery of aircrafts to Indian Airlines and Air India are adhered to so that the National Carriers are able to take maximumbenefits of exemption from payment of tax under Section 10(15A). The Committee hoped that the Ministry would not hesitate to invoke the penalty clauses in the terms and conditions of the purchases in the event of failure to adhere to theagreed timeframe of delivery of aircrafts. The Committee recommended the Government to ensure that the commitmentsmade by the M/s. Boeing and M/s. Airbus Industrie to set up training centers for flight and maintenance training, investmentin areas such as Pilot training, aircraft maintenance and repair etc. may be in place well in time. It was further recommendedthat the matter regarding the extension beyond 1st April, 2007 of the exemption from payment of tax on lease rentals payable to a non-resident foreign lessor under Section 10(15A) should be pursued with the Ministry of Finance. The Committee also recommended that Government should explore the possibility of extending its space/defence aeronautical endeavours to themanufacturing of civilian aircrafts to reduce the dependency on foreign companies for the supply of aircrafts. Alliance Air

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11.199 The Committee noted with concern the deterioration of flight connectivity in the North Eastern region due to theconstraints faced by Alliance Air on account of exodus of pilots, in view of the fact that the North Eastern region had got strategic importance. The Committee, therefore, recommended that the efforts being made to induct pilots should beintensified to normalize the operations of Alliance Air in the North-East. The Committee also recommended that the assurance of putting more aircrafts on routes in the North-East after the acquisition of aircrafts by Indian Airlines should befulfilled immediately after the delivery of the first batch of aircrafts. Air India Express 11.200 The Committee felt that the operations of Air India Express had been of immense help to the expatriate Indian workers in the Gulf region. The Committee recommended that the operations of this budget airlines should be carefullyplanned with a view to achieve the objective of offering low cost air connectivity to skilled/unskilled Indian workersemployed in the Gulf region and other parts of the world. The Committee expected that the Ministry will take suitable stepsso that aspirations of the people for increasing the frequency of operations as well as providing connectivity to new regionswill be fulfilled. Pawan Hans Helicopters Limited 11.201 The Committee felt that there was tremendous scope of utilizing the helicopter facility to connect the remotetourist places. The Committee recommended that Pawan Hans Helicopters Limited should prepare specific plans todiversify/connect to important tourist places as a part of diversification of its operations. The Committee expected that theapproved outlay for new fleet acquisition will be fully utilised in the current financial year. The Committee noted that asubstantial number of the grounded operating fleet of Pawan Hans Helicopters Limited was rendered unserviceable duringthe torrential rains/floods at Mumbai in July 2005. The Committee recommended that suitable contingency plans should be evolved to prevent the recurrence of such mishaps. The Committee also recommended that efforts should be made to make the damaged Dauphin fleet serviceable in a time bound manner. Airports Authority of India 11.202 The Committee noted that the approximate financial implication for the development of 35 Non-Metro Airports would be Rs. 4662.50 crore over a period of five years starting from 2006-07 to 2010-11 and that the Ministry was considering a proposal to levy ADF/ UDF on passengers at these 35 Non-Metro Airports for funding the part development cost and to make the project financially viable as per the proposal. In this context the Committee desired to draw the attention of the Ministry to the assurance given in the Action Taken Replies furnished by it on the recommendationscontained in the 90th Report of the Committee that after the restructuring of the Delhi and Mumbai airports, Airports Authority of India will be better off financially and it will not only be able to maintain other airports in the country but alsoupgrade and modernize these airports. Further, it was also submitted that Airports Authority of India was planning tomodernize 35 Non-Metro Airports to world-class standards by using reserves including internal reserves. The Committee further recommended that the proposal should be expedited and implemented in a specific time frame. 11.203 The Committee noted that there was a spurt in the commercial activities in Mangalore, which was likely to benefitthe civil aviation activities in the region. The Committee, therefore, recommended that in order to harness the potential benefits, the necessary steps, including discussions with the State Government, for the early commissioning of the Mangaloreairport and commencement of international flights should be taken by the Ministry. 11.204 The Committee noted that utilisation of funds and physical progress in the projects under implementation in theNorth Eastern region was very poor barring a few projects. The Committee recommended that Airports Authority of India should give focussed attention to the projects under implementation in the North Eastern Region and fix achievable targetsfor early completion of the same. The Committee recommended that the preparatory steps for the construction of an airfield in Arunachal Pradesh should be completed at the earliest so that people of that State can be provided with air connectivity torest of India. In the matter of provision of adequate finances, the Committee recommended that the Ministry should pursue the matter with the Ministry of Development of North Eastern Region. The Committee also recommended that the Ministry should explore the possibility of allocating more funds from the internal resources to fund the airport developmental projectin the North Eastern region. Restructuring Delhi and Mumbai Airports 11.205 The Committee recommended that the Tripartite Committee with the representatives of Ministry of Civil Aviation,Airports Authority of India and AAI Employees Joint Forum should hold regular meetings and finalise its Report in a timebound manner in view of the importance of the issues relating to modernization of airports by Airports Authority of India and

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the stake of the employees including job security. Kolkata & Chennai Airports 11.206 The Committee appreciated the initiatives taken by the Ministry with regard to construction of internationalairports at Kolkata and Chennai. The Committee was of the opinion that with the growth of the aviation sector in the country,the pressure and strain on Mumbai and Delhi airports was also increasing. The Committee was apprehensive that with the arrival of private players in the airline sector, there will be further intensification of this pressure. As accepted by theSecretary of the Ministry, the Delhi and Mumbai-centric activity was also becoming unmanageable. The Committee,therefore, felt that there exists a need to develop alternate airports and recommended that work of international terminals at Kolkata and Chennai should be completed at the earliest. Private Scheduled Airlines 11.207 The policy of opening up of international skies to Indian scheduled airlines was adopted to ensure full realization of the objective to enhance utilisation of traffic rights available to India. The Committee, however noted that despite the permission granted to private carriers to operate services to USA and Belgium, the services have not commenced and it was surprising that the Ministry had left the matter to the commercial judgement of the concerned airlines. The Committee wasof the view that there should be proper monitoring of the permissions granted by the Ministry and recommended that it must be ensured that actual operations are started by the operators so that the stated objective of optimum utilisation of trafficrights was achieved. The Committee also reiterated its recommendations contained in its 96th Report, which was reproduced below: -

“The Committee noted from the reply of the Ministry that there are only two minimum eligibility criteria prescribedfor selection of scheduled domestic airlines to be allowed to operate on international routes, namely, a minimumfleet strength of 20 aircraft and a minimum experience of five years operations on domestic routes. The Committeealso noted that the basic policy of the Government to allow the scheduled carriers to operate on international routes had been framed after due consideration of the Report of Naresh Chandra Committee, which was submitted to theMinistry in December 2003. The said committee had reportedly revealed that we are presently using only 40% ofour bilateral rights. However, the Committee felt that the steep restrictions imposed by the Ministry were impediments in achieving the basic objectives behind the new policy to mitigate under capacity in the internationalsegment and to enhance global connectivity to and from different states in the country. The Committee recommended that in view of the irreversible nature of the new policy, the Ministry should review its prescribedstandards regarding fleet strength, maintenance facilities, safety systems etc. for granting licences to new airlines inthe domestic sector, taking into consideration the requirements for the international sector also. Such a reviewwould enable the relaxation of the existing stringent restrictions on Indian scheduled airlines for internationaloperations. The Committee also noted that the stringent restrictions have not been able to avoid the denial of flightsto one of the private airlines to destinations in the United States of America.”

Shortage of Trained Manpower in Civil Aviation Sector 11.208 The Committee noted that the civil aviation sector in the country was growing at a fast rate and more and moreprivate carriers are joining the field. There was also a proposal for large-scale aircrafts acquisition by Indian Airlines and Air India. The Committee, therefore, recommended that the various efforts at augmenting the number of trained Pilots, AirTraffic Control (ATC) Personnel and Service and Maintenance Engineers should receive focussed attention, so that there areno slippages in the targets sought to be achieved. The Committee also recommended that the capacity of upgradation of Indira Gandhi Rashtriya Uran Academy (IGRUA) and the construction of the new Flying Training Academy at Gondia should be completed within a stipulated time-frame. Merger of Airlines 11.209 The Committee observed that of late there have been changes in the strategy of private airlines operators by wayof consolidation of their operations. The Committee felt that these conditions can lead to monopolistic situation in civilaviation sector and there was a need to check this trend. The Committee, therefore, recommended that while formulating the new Civil Aviation Policy, all the consequences of merger of airlines including the matter regarding reallocation ofinfrastructural facilities at airports should be addressed properly. Route Dispersal Guidelines 11.210 The Committee was surprised to note that no final decision had been taken by the Ministry to review the existing Routes Dispersal Guidelines although the internal Committee set up under the Chairmanship of Director General of Civil

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Aviation had submitted its report on 18th March, 2005. The Committee also noted that although no decision had been taken on the proposal to impose a surcharge to fund the minimum subsidy to be given to the successful bidder who offers to operatein North Eastern region, island territories and the States of Jammu & Kashmir, the proposal was initiated on the demandsmade by airlines operators for amending/scrapping of the Route Dispersal Guidelines as they find it uneconomical to operateto the said regions on purely commercial considerations. The Committee was of the view that the demands of the privateoperators are unjustified as the national carriers are also operating to the said regions on purely social considerations. TheCommittee was of the opinion that the private carriers should also share the social obligations. In view of the boom in thedomestic passenger traffic, the Committee felt that the hitherto non-commercial or unviable routes have been transformed into profit making routes. The Committee recommended that the Ministry should make an analysis of the profit/loss on the so-called non-commercial routes before taking final decisions in the matter. The Committee was also of the opinion that they to operate flights in the non-commercial routes, if any use the profits generated by the private carriers. In this scenario,the Committee recommended that the Ministry should also make a study as to whether the grant of minimum subsidy toairline operators will result in corresponding reduction in airfares on the main routes. Under utilisation of ILS CAT-III System installed at Indira Gandhi International Airport, Delhi 11.211 The Committee noted that despite the efforts made by the Ministry, the private airlines operators have not yet trained their pilots for ILS Cat-III operations. The Committee also noted that the Director General of Civil Aviation had been asked to thoroughly examine the legal and operational issues related to making the training in Cat-II / III A & B operations mandatory. The Committee recommended that the Report of Director General of Civil Aviation should beexpedited and suitable steps should be taken in time to enhance the utilisation of ILS Cat-II/III A & B installed at IndiraGandhi International Airport, Delhi by private carriers. In this context, the Committee reiterated its earlier recommendations contained in its 88th and 96th Reports, extracts from which are reproduced below:-

“The Committee recommended that in order to improve the operational efficiency during the extreme foggy conditions, the Ministry should amend 'Aircraft Rules' to incorporate a provision for making training of pilotscompulsory by the private airlines on CAT-III System so that the investment made by the Government on the installation of the system through the tax payers' money was not underutilized.”

“The Committee, therefore, reiterated its recommendation that in order to improve the operational efficiency duringthe extreme foggy conditions, training of pilots should be made compulsory by the private airlines on CAT-III System. The Committee further recommended that utilization of CAT-II and CAT-III systems by private airlines should be made compulsory by training a fixed minimum proportion of their pilots and it should be enforced by theGovernment strictly.”

Benchmarking of Airports 11.212 The Committee noted that the although there are certain pre-requisites for declaration of an airport as international airport, the term world class airport was an objective term depending on the availability of facilities comparable to majorairports in the region. The Committee is, therefore, of the opinion that the airports declared as international airports in thecountry will not certainly be of world class standards unless passenger friendly facilities are developed. In this context, theCommittee noted that the customer satisfaction survey had revealed that overall satisfaction level with Mumbai InternationalAirport, Delhi International Airport and Delhi Domestic Airport are well below the desired standard of 3.5 on a five point scale and also the average obtaining in airports in the Middle East/Asia Pacific region. Only the figures in respect of MumbaiDomestic Airport are near to the desired standard of 3.5 and the average obtaining in airports in the Middle East/Asia Pacificregion. The Committee, therefore, recommended that there was a need to develop suitable institutional mechanism to assessthe performance standards on continuous basis and take steps to upgrade the same to world-class standards. Allotment of Parking Bases 11.213 The Committee noted that the Airports Authority of India was in the process of developing a policy on theallotment of night parking bays to various airlines and additional parking bases are being constructed at various airports inthe country to meet the demand. The Committee recommended that the policy should be formulated at the earliest and the work relating to construction of additional parking bases at various airports should be completed within a stipulated timeframe. The Committee also expected that the airline operators would avail the concessions offered by the Ministry todecongest the bigger airports. Packages for Official Travel and Leave Travel Concession (LTC) 11.214 The Committee noted that Air India had initiated discussions with the various Ministries in the Government of

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India and was formulating a very attractive package for Government of India personnel travelling abroad. The Committee recommended that the signing of the Memoranda of Understanding with various Ministries to ensure that a large part ofGovernment of India personnel travel on Air India should be completed at the earliest so that the hitherto assured revenuewill remain with the organisation. The Committee noted that the special package of Leave Travel Concession toGovernment of India personnel to visit Jammu and Kashmir expires in June 2006 and therefore recommended that the Ministry should provide additional flights till such period to the extent possible in view of the non-availability of accommodation in the present flight schedule. National Civil Aviation Policy 11.215 The Committee noted that the draft National Civil Aviation Policy had been prepared prior to March 2005 and the same had not been finalised so far. The Committee felt that there was an urgent need to regulate the growth of civilaviation sector particularly after the entry of private sector in this field. The airlines operators of the opinion that the boom inpassenger and cargo traffic in the domestic sector emphasizes the need to provide protection to the users of the servicesprovide the Committee. The Committee, therefore, recommended that the National Civil Aviation Policy should be formulated and announced at the earliest to address the complex issues prevalent in the civil aviation sector of the country. (o) 107th Report on the action taken by the Government on the Recommendations/observations of the Committee

contained in its Ninety-First Report on functioning of the Archaeological Survey of India Organisational set up and the Post of Director General of the Archaeological Survey of India 11.216 The Committee observed that the decision to fill-up the post of Director-General, Archaeological Survey of India was taken long back vide Government Notification of May 2002. But still the Ministry did not make any effort to implement it and it was abundantly clear from the fact that no suitable change was made in the recruitment rules and also nojustification had been given for not reviving the post of Additional Director-General, which constitutes the feeder channel for promotion to the post of Director General. In view of this the Committee reiterated its recommendation that a person who had no basic qualification or knowledge of archaeology cannot handle the apex responsibility of a Scientific Institution like Archaeological Survey of India. Therefore, the Committee recommended that the post of Director General, Archaeological Survey of India should be filled up as per the requirements of the Notification of May, 2002 without anyfurther loss of time. Archaeological Survey of India as a Scientific and Technical Department 11.217 The Committee noted the reply and desired that the Ministry will expedite the matter sincerely and inform theCommittee about the progress regarding extension of benefits of a Scientific and Technical Department to the ArchaeologicalSurvey of India. Sarasvati Project 11.218 The Committee was surprised to note that its recommendations made in the context of Sarasvati Heritage Projectthe Department of Culture in its reply had not mentioned a single word about the Sarasvati Project or the irregularitiespointed out by the Committee about the preparation of that project. Our country had a rich and composite cultural heritage. The Archaeological Survey of India was the custodian of that rich cultural heritage and as such its role to safeguard thecultural fabric of the country was of crucial national importance. Therefore, the Committee reiterated that before undertakingany excavation of any such mythological projects like, Sarasvati Heritage Project, Archaeological Survey of India shouldmake proper Scientific and technical appraisal and no extraneous factors should go into the decision making. Non-writing/Publication of Excavation Reports 11.219 The Committee noted the reply and desired that final reports pertaining to all 56 excavations, which are stillpending, would be completed by September 2, 2007, positively. The Committee further directed that the department should inform the Committee about writing/publication of final excavation Reports on quarterly basis till September, 2007. Encroachment and Security of Monuments/Sites 11.220 The Committee observed that installation of modern gadgets like electronic surveillance, cameras, etc. in all monuments of national importance primary requirement in view of the present security scenario of the country and felt that installation of cameras at Taj Mahal, Agra only was an inadequate step like a drop in an ocean. The Committee recommended that adequate funds should be made available to the Department for this purpose.

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11.221 As regards, expenditure incurred for availing security services of the CISF was concerned, the Committee noted thereply of the Home Secretary. The issue, however, may be taken up with Ministry of Finance for providing additional fund tomeet the expenditure incurred for availing security services for the protection of monuments of national importance. (p) 108th Report on the ‘Functioing and Performance of the India Tourism Development Corporation (ITDC)’: Role of ITDC 11.222 The Committee noted that with the transformation of Indian economy to keep pace with globalization, the ITDCwas striving to achieve its objectives of developing and expanding tourism infrastructure in the country and promoting Indiaas a tourist destination of the globe by providing all tourism related services under a single roof. The Committee felt that though ITDC was functioning on commercial lines it should also help in removing the regional imbalances by properdiffusion and uniform percolation of socio-economic benefits amongst all stratas of the society. The Committee felt that in this manner, it would pave the way for more employment generation in the tourism sector and act as a catalyst fordevelopment of Tourism across the country. Board of Directors 11.223 The Committee noted with concern that the re-constitution of the ITDC's Board of Directors with appointment of non-official part time Directors remains under consideration of the Department. The Committee felt that presence of non-official Directors on the Board will make the Board more professional. The Committee, therefore, recommended that the posts of part time non-official Directors on the Board of ITDC should be filled up by the Government from the concerned areas without fail. Geographical Spread of ITDC 11.224 The Committee noted that ITDC had been playing active role, both as promotional and commercial for thedevelopment of tourism infrastructure spreading all over the country. The Committee also noted that ITDC had set-up a Tourism Task Force for promotion of camping and adventure tourism in the remote areas in collaboration with the localGovernments/authorities. The Committee found that consequent upon the implementation of disinvestment policy, thepresence of the Corporation in the country had shrunk and ITDC stopped setting up of new hotels/resorts in the country. TheCommittee felt that this had not only confined the activities of ITDC to metropolitan cities but also diminished thegeographic spread of ITDC. The Committee, however, recommended that the geographic spread of ITDC should not beconfined only to metro cities of the nation but it should further be expanded to rural areas and hinterlands to provide requiredlogistics to foreign and domestic tourists and the Department of Tourism should provide all support/help to ITDC in thisregard. The Committee further recommended that Department of Tourism should consider the detailed project reportsprepared by ITDC under Rural Tourism Development Scheme and release funds for execution of works. The Committeealso recommended that ITDC should monitor the execution under the Rural Tourism Development Scheme. This will createinfrastructure in the villages, which in turn will play catalytic role for attracting private investmentthere. Financial Performance 11.225 The Committee noted that after suffering losses since 1999-2003, the Corporation made a turnaround during 2003-04 and earned a net profit (before tax) of Rs.2.86 crore which was increased substantially to Rs.31.16 crore in the year 2004-05. During the year 2004-05, the turnover of the Corporation increased by 25.4 per cent from Rs.289.95 crore in 2003-04 to Rs.363.49 crore in 2004-05. The Committee observed that during 2005-06 (upto December 2005), the financial performance of the Corporation had further improved as compared to the corresponding period last year and the turnover vis-a-vis profit during 2005-06 increased to Rs.265.43 crore (provisional) and Rs.17.70 crore (provisional) respectively. TheCommittee hoped that careful planning and infusion of capital investments for the future would definitely help the ITDC in emerging as a self sustained and profitable Organisation.

Reasons for Low Performance and Measures Taken for Improvement in the Functioning 11.226 The Committee noted the reasons put-forth by the Department of Tourism for low performance from 1999-2000 to 2002-03 and the measures taken by them for improvement in the financial performance of the ITDC. However, theCommittee was not satisfied by the measures taken by them for improvement in the performance vis-a-vis profitability. The Committee felt that due to the uncertainty and apprehensions of insecurity created by the disinvestment during the last four years, the ITDC was totally engaged in fighting for its own survival and reviving the business. The Committee was of theview that for gaining business, the ITDC should play the role of a facilitator and should take-upon itself the activities like capacity building, creating infrastructure facilities etc. rather than going into specific kind of service oriented activities. The

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Committee recommended the Department that it should first identify the core-activities of ITDC including user selling point, clientele and target groups and then it should be motivated further to strengthen these core-activities for enabling this nodal organization to compensate the loss already incurred. 11.227 The Committee noted with concern that most of the ITDC properties need upgradation and renovation because noinvestment had been made during the last several years due to uncertain circumstances, which prevailed regarding the disinvestment of these properties. The Committee felt that if the ITDC properties are not upgraded then it will be difficult for the Corporation to maintain even the present level of business. The Committee was also of the view that it was high timefor making substantial investment in these properties for their revival. The Committee, therefore, recommended that the Government should provide budgetary support by way of additional equity, which can be utilised by the ITDC forundertaking upgradation programmes on priority basis so as to make ITDC a vibrant organisation in the future. 11.228 The Committee noted that an amount of Rs.50.19 crore was pending as total outstanding dues of the ITDC. TheCommittee further noted that out of this an amount of Rs.14.34 crore was pending for more than three years. TheCommittee took strong exception to the fact that ITDC had failed to realize the outstanding dues pending for more than three years. ITDC had suffered a loss during the era of disinvestment when some of its prime properties were sold out. Theoutstanding dues to the tune of more than Rs.50 crore have further aggravated the problem of ITDC. There appears to lack ofwill on the part of Government so far as recovery of dues are concerned, as most of the agencies mentioned are the subsidiaryof the Government. The Committee also found the reply of the Department of Tourism so far as the list of defaulters wasconcerned, which inter-alia mentions Vigyan Bhawan and Headquarter which implies the defaulters vaguely. The Committee recommended that Government should take steps to realize the pending dues in time. Foreign Exchange Earnings and Outgo 11.229 The Committee noted that the Direct Foreign Exchange Earnings of the ITDC during 2004-05 was Rs. 156.59 crore as against Rs. 121.65 crore in the previous year and the outgo of the foreign exchange duringthe year was 70.79 crore as against Rs. 61.26 crore in the year 2003-04 respectively. However, the Committee noted that the foreign exchange expenditure by the ITDC was mainly due to the payments made in foreign currency for purchases madefrom the suppliers of international goods for sale at Duty Free Shops, Overseas Advertising Campaign and foreign travellingfor the purpose of business promotion. The Committee was of the view that the expenditure on foreign travelling andmembership fee should be kept on the lower side and it should be incurred in exceptional circumstances. The Committee,therefore, recommended the Department to make all efforts to economise expenditure in terms of foreign exchange. Review of Performance 11.230 The Committee noted that the Department of Tourism and Department of Public Enterprises make theperformance appraisal of ITDC annually on the basis of set targets and achievements. It also noted that there was an AuditCommittee of the Board, which reviews the performance on quarterly basis and suggested remedial measures forimprovement. However, the Committee was not satisfied with the present performance appraisal mechanism and desired the Department to conduct a detailed study by some outside agency for analyzing the reasons for low performance of ITDC vis-a-vis its profitability. Network of ITDC Services—Ashok Group of Hotels and Catering Establishments 11.231 The Committee noted that after incurring losses since 2002-03, the Ashok Groups of Hotels had emerged as a profit-making centre in the year 2004-05. The Committee also noted that Ashok Hotel being the flagship, had a brand image but that image was no longer there as compared to the hotels in the private sectors. The Committee felt that there was a need for restoration of this image in the market so that they can contribute towards the hospitality industry at large and earnrevenue for themselves. The Committee, therefore, recommended the Department to make concerted efforts to turnaroundITDC Ashok Groups of Hotel with world-class facilities and re-position it as an brand ambassador in its group. The Committee also recommended that in order to make ITDC a leading organisation for the future, the Government shouldgrant matching equity support to ITDC on 1:1 basis for upgradation and major renovation of Ashok Groups of Hotels andenergising other divisions too. The 50% investment should be in the form of equity and 50% investment by way of loan fromthe Financial Institutions. Ashok International Trade Division

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11.232 The Committee noted with satisfaction that the Ashok International Trade Division achieved highest turnoverduring the year 2004-05 from retail sale of duty free goods to the direct consumers. However, it noted with dismay that dueto the impact of extraneous factors like SARS etc. there was a drop in the inbound as well as outbound tourists, which furtheraffected the tourism scenario in the country and particularly the ITDC. The Committee felt that the vicious circle could have been broken if the local tourism was given enough encouragement and recommended the ITDC to enlarge the activities of Ashok International Trade Division, so as to counter the adverse impact of extraneous factors on the business andprofitability. 11.233 The Committee expressed its unhappiness over the privatization of Delhi and Mumbai airports due to which there prevails uncertainty in the operation of Duty Free Shops in these airports, which contributed about 75% turnover of theAshok International Trade Division (AITD). However, the Committee noted that ITDC had been successful in securing and executing agreements with private management of Delhi and Mumbai Airports for extensions of licence for a further period of six months for operations of Duty Free Shops at these airports on the similar terms and conditions as was there with AAIpreviously. The Committee felt that although the future status of AITD was uncertain and will much depend on the policyof the private managements in the selection of Duty Free operators but at the same time, ITDC can get the contract with amix of marketing strategies, right merchandising, competitive pricing and sustained product promotions. The Committee washopeful that given a fair and competitive environment, AITD will be able to secure the contract in these airports in the futurebesides operating Duty Free Shops in Chennai, Kolkata, Trivandrum, Goa, Calicut, Hyderabad, Ahmedabad and Bangaloreairports. The Committee recommended the Department to make all out efforts in securing the contract for operating DutyFree Shops in these airports. 11.234 The Committee noted with dismay that the issue of rent/royalty between AAI and ITDC had not yet been settled and the case was under mediation. The Committee was of the view that ITDC though a commercial entity was exposed tobusiness risk but at the same time, the incidence of high rate of rent have adversely affected the product pricing, profitabilityand competitive edge of the AITD. The Committee opined that inspite of the contract, the dispute be resolved on the basis ofequity between AAI and ITDC and some concessions may also be offered. The Committee recommended the Department to pursue the matter with the Ministry of Civil Aviation and Ministry of Finance for early settlement of issue of royalty. Ashok Travels & Tours 11.235 The Committee noted with dismay that Ashok Travel and Tours Division of ITDC was continuously incurringlosses because of the highly competitive market conditions. The Committee was of the view that the deficit can be balancedby the ITDC from its corporate earnings. The Committee recommended the Department to suitably restructure the Divisionto function as a major tour operator in the country and take advantage of market conditions and prevailing boom in thetourism sector. Ashok Reservations and Marketing Services 11.236 The Committee noted that Ashok reservations and marketing services division of ITDC had been appointed as event manager by various Ministries/Organisations for handling conferences, events and exhibitions. The Committee recommended the Department to resort to aggressive marketing plans so that ITDC becomes the leading event manager of thecountry. Ashok Creatives 11.237 The Committee noted that Ashok Creatives was the only specialised tourism communication agency in thecountry offering a range of tourism and travel related services to Department of Tourism. The Committee recommended that this Division should excel in capturing the booming sector like Advertising by taking advantage of the experience and thecreative talent of in-house people and continue to expand its activities by undertaking tourism development projects for theDepartment of Tourism/State Government Tourism Departments and other external agencies. Engineering & Consultancy—Business Development Division 11.238 The Committee noted that the Engineering Division of ITDC had been entrusted with the job of development of tourism infrastructure and various other projects by the Department of Tourism and State Government besides providingEngineering Consultancy services including preparation of feasibility reports, tourism master plans and detailed projectreports. The Committee felt that there was a need for re-organisation of this Division, as it had to play a major role for providing consultancy and assistance to various State Governments and other regions of the country. The Committee,therefore, recommended that the Engineering & Consultancy Division of ITDC should be strengthened and motivated so that they can implement projects of infrastructure development with the State Governments at a rapid rate.

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Ashok Institute of Hospitality & Tourism Management 11.239 The Committee noted that Ashok Institute of Hospitality & Tourism management was imparting training forhospitality, travel and tourism Industry and emerged as a separate strategic business unit and education provider in humanresource development for the hospitality and tourism sector. The Committee was of the view that there was a great demandfor trained manpower in the hospitality & tourism sector and availability of trained manpower was a must to meet thegrowing demand for excellence in the tourism sector. The Committee was of the firm opinion that contemporary relevanceof ITDC was more in terms of its demonstrative ability of showcasing new ideas that are emerging in the field of tourism andit should set standards to deal with the challenges in the field of tourism. The Committee however, recommended the ITDCto expand the scope of activities of Ashok Institute of Hospitality &Tourism Management to other regions in the country andimpart quality education for meeting the shortage of trained manpower in the tourism othersectors. Sound & Light Shows 11.240 The Committee noted that after incurring losses since 2002-03, the Ashok Sound & Light Show had turn around during 2004-05 and earned profit. The Committee felt that in order to showcase India's rich cultural heritage, history and values to the masses, there was a need to produce such Sound & Light Show in every State. The Committee, therefore,recommended the Department to explore the possibility of mounting sound and light shows in every State. Ashok Tourist Service Station 11.241 The Committee noted that that Ashok Tourist Service Station was an Indian Oil retail outlet-cum-service station run by the ITDC. The Committee also noted that this service station was running into losses. The Committee recommendedthe Department to restructure the service station suitably besides, implementing sales-promotion schemes for recovering from the burgeoning losses in the future. Disinvestment of ITDC Hotels 11.242 The Committee was at pain to note that the role of ITDC was limited only upto providing information/data/material to the Advisor, Ministries of Disinvestment and Tourism and to implement decision of the Government for disinvestment ofhotels. The apex corporation in the field of tourism was not even given a reasonable opportunity for making presentation anddefending its case before the Disinvestment Commission or pleading its case. The Committee strongly denounces the moveof the Government for not giving any opportunity to the ITDC for being heard before disinvestment of its properties althoughit was performing well. Further, by putting few other ITDC hotels in the disinvestments list for some years and subsequentlyremoving those therefrom, also dampened the spirit of the employees working in these hotels and of the Corporation. TheCommittee, therefore, recommended that a thorough probe in the matter of disinvestment of ITDC Hotels be undertaken bythe Government to know the entire sequence of disinvestment of ITDC's properties and reasons for doing so by someindependent agency. The probe should also include as to what was the end use of the money collected through disinvestmentsof ITDC properties. 11.243 The Committee noted that disinvestment and its impact on the ITDC had made the organisation crippled. TheCommittee found that during 1999-2003, ITDC made a total loss of Rs. 159.52 crore and before and after that period, ITDChad generally been performing well. The Committee observed that during the process of disinvestment, ITDC also faced certain difficulties because of some external factors and suffered losses during four consecutive years leading to financialcrunch. The Committee felt that the sale proceeds of Rs. 429.24 crore from disinvestment of 18 hotels, including one hotelthat was under construction, should have been handed over to ITDC for revitalizing and reviving, the position could havebeen different, and ITDC could have been able to generate internal resources for setting the things right. The Committee,therefore, recommended the Department of Tourism to approach Planning Commission and Ministry of Finance forbudgetary support for implementing the capital investment and restructuring programmes and in the meantime, theDepartment should consider giving some of the hotel properties on lease through public-private partnership to turnaround the loss making hotel units and to improve the physical conditions of the remaining hotels. 11.244 The Committee welcomed the decision of the Government for not making further disinvestment of ITDCproperties. The Committee was of the view that the retention of ownership of ITDC properties will help remove theuncertainty and fear created in employees and will bring back the business inflow into the hotels. But, at the same time inorder to face the competition with other private hotel players, these hotel properties including that of joint venture propertiesrequire renovation/upgradation without any further loss of time. The Committee felt that option of leasing out the hotel properties would be in the best interest of the Corporation, as presently ITDC was not in the position to make capitalinvestments in the hotels for their renovation/re-furbishment. The Committee therefore, recommended the Department to offer some of the hotel properties including joint ventures properties on lease-cum-management contract basis to private sector for making capital investments in these properties for renovation/upgradation.

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11.245 The Committee took noted of the fact that out of 26 hotels owned by ITDC, 18 hotels have been disinvested andactivities of ITDC have been suitably re-structured and diversified into new innovative services for development of tourism in the country. The Committee felt that since ITDC was integral part of tourism sector, its efficiency can be projected as arole model in the entire gamut of tourism industry. The Committee recommended that the ITDC should re-invent, re-organise and re-structure itself in view of the changing market needs and accordingly redefine it’s role and priorities so as to set world-class benchmarks for other private players in the hospitality industry. The Committee also recommended that as apart of turning-around strategy, the Government must support and sanction funds to the ITDC for undertaking essentialrenovation works to revive the loss making hotels and product upgradations.

V. SECRETARIAT 11.246 The Committee Section (Transport and Tourism) headed by a Committee Officer constitutes the Secretariat of the Committee. An Under Secretary remained incharge of the Branch and a Director, a Additional Secretary supervised at higher levels. 11.247 To assist the Committee in its work, material received from the Ministries/Departments/various non-official organizations and individuals was studied in detail and based on the material available with the Committee questionnaire forwritten replies/evidence were prepared for the use of the Committee.

11.248 The Secretariat collected material for on-the-spot study and prepared study tour notes. 11.249 The work relating to drafting, consideration and approval of draft reports by the Committee along with their presentation, laying, printing and distribution was undertaken. The Secretariat also dealt with the work relating to the scrutiny of action taken notes received from the Ministries concerned on the recommendations contained in the Reports of theCommittee and preparation of Draft Reports of the Committee on the Action Taken Reports.

11.250 The Secretariat also studied material like Parliamentary Debates, answers to Parliamentary Questions, Budget Estimates, Five Year Plan Documents, Books, Journals, newspapers etc. relevant to the subjects under examination of theCommittee.

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Annexure-XI(See Para 11.5)

Details of the sittings of the Committee on Transport, Tourism and Culture during the year 2006

Sl. No.

Date of Meeting

Duration Hrs-Mts.

Main items of Agenda Evidence taken, if any

1. 12.1.2006 2-10 The Committee heard the views of Secretaries, Departments of (i) Road Transport & Highways and (ii) Shipping, respectively, on the Carriage by Road Bill, 2005 and Inland Vessels (Amendment) Bill, 2005.

Secretaries of the- (i) Department of Road

Transport and Highways; and

(ii) Department of Shipping.

2. 23.1.2006 1-30 The Committee heard the views of the Experts/Stakeholders on the Carriage by Road Bill, 2005.

Representatives of—

(i) Centre For Science and Environment, New Delhi.

(ii) All India Transporters Welfare Association.

(iii) All India Confederation of Goods Vehicles Owners Association.

(iv) All India Motor Transport Corporation.

3. 1.2.2006 1-30 The Committee heard the views of the Associations/Stakeholders on the Inland Vessels (Amendment) Bill, 2005.

Representatives of—

(i) Goa Barge Owners Association, Goa.

(ii) M/s Sanghi Brothers (Indore) Ltd., Goa.

(iii) M/s Ganga Water Transport Co. Pvt. Ltd., Kolkata.

(iv) M/s Eastern Navigation Private Ld., Kolkata.

(v) Representatives from M/s Vivada Inland Waterways Ltd., Kolkata.

(v) Central Inland Water Transport Corporation Ltd., Kolkata.

4. 22.2.2006 0-45 The Committee considered and

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adopted the draft 92nd, 93rd, 94th, 95th, 96th and 97th Reports on the – (i) Action Taken by the Government on the Recommendations/ Observations of the Committee contained in its Eighty-fourth Report on Demands for Grants (2005-06) of Department of Road Transport and Highways;

(ii) Action Taken by the Government on the Recommendations/ Observations of the Committee contained in its Eighty-fifth Report on Demands for Grants (2005-06) of Ministry of Culture;

(iii) Action Taken by the Government on the Recommendations/Observations of the Committee contained in its Eighty-sixth Report on Demands for Grants (2005-06) of Department of Shipping;

(iv) Action Taken by the Government on the Recommendations/Observations of the Committee contained in its Eighty-seventh Report on Demands for Grants (2005-06) of Ministry of Tourism;

(v) Action Taken by the Government on the Recommendations/ Observations of the Committee contained in its Eighty-eighth Report on Demands for Grants (2005-06) of Ministry of Civil Aviation; and

(vi) Action Taken by the Government on the Recommendations/Observations of the Committee contained in its Ninetieth Report on the ‘Development of Airport Sector with special emphasis on new modern airports’.

____

5. 17.3.2006 0-30 The Committee considered the draft 98th Report on Action Taken by the Government on the Recommendations/ Observations of the Committee contained in its Eighty-third Report on the "Functioning of the Commission of Railway Safety" and after some discussion, adopted the report with minor modifications. Thereafter, the Committee took up clause-by-clause consideration of the

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Admiralty Bill, 2005; the Inland Vessels (Amendment) Bill, 2005; and the Carriage by Road Bill, 2005. The Committee also considered the draft 99th 100th and 101st Report on the said Bills and adopted the same with minor modifications.

6. 27.4.2006 4-15 The Committee took up the examination of the Demands for Grants of the Departments of (i) Shipping and (ii) Road Transport and Highways

for the year 2006-07 and heard the views of the Secretaries of the respective Departments on the subject.

Secretaries of the (i) Department of Road

Transport and Highways; and

(ii) Department of Shipping.

7. 28.4.2006 5-00 The Committee took up the examination of the Demands for Grants of the Departments of (i) Tourism, (ii) Culture and (iii) Ministry of Civil Aviation for

the year 2006-07 and heard the views of the Secretaries of the respective Departments/ Ministry on the subject.

Secretaries of the (i) Department of

Culture (ii) Department of

Tourism; and (iii) Ministry of Civil

Aviation.

8. 19.5.2006 1-00 The Committee considered the draft 102nd, 103rd, 104th, 105th, 106th Reports on Demands for Grants (2006-07) of the Departments of

(i) Road Transport & Highways,

(ii) Culture,

(iii) Tourism,

(iv) Shipping,

(v) Ministry of Civil Aviation and 107th Report on the ‘Action Taken by the Government on the Recommendations/ Observations of the Committee contained in its Ninety-first Report on ‘Functioning of the Archaeological Survey of India’, respectively, and after some discussion, adopted all the six reports.

______

9. 29.5.2006 0-30 The Committee discussed its future programme.

______

10. 12.6.2006 1-45 The Committee heard the views of the Secretary, Department of Shipping on the Development of Inland Water Transport Sector and setting up of Indian Maritime

Secretary, Department of Shipping.

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University in the country

11. 5.7.2006 2-45 The Committee heard the views of the Secretary of the Department of Tourism and Chairman & Managing Director, ITDC on the ‘functioning and performance of India Tourism Development Corporation (ITDC)’.

Secretary, Department of Tourism.

12. 20.7.2006 2-30 The Committee took up the subject “Air Safety and related issues” and heard the views of the Secretary, Ministry of Civil Aviation on the subject.

Secretary, Ministry of Civil Aviation.

13. 6.9.2006 0-50 The Committee discussed its future course of action. It was also decided that the Committee will take up three more new subjects i.e. Tourism and ASI – An Interface, Functioning of Museum and Art Galleries of National Importance and Development of Inland Water Transport System in the Country for in-depth study and examination. The Committee directed the Secretariat to obtain detailed background notes on the subjects from the concerned Ministries/Departments for consideration. The Committee also directed the Secretariat that the latest information on the status of recouping the shortage of funds from the Seamen’s Provident Funds and the restructuring/revival of Hooghly Dock & Port Engineers Ltd.(HDPEL), Kolkata may be obtained from the Department of Shipping. The Committee then decided to undertake study visit to Goa, Kochi and Lakshadweep Islands sometimes during the second week of November, 2006 for an on-the-spot study relating to Development of Tourism, Cargo Handling at Major Ports, International Air connectivity to and from Kochi Airport to Middle East and Gulf Countries, Passengers-cum-Cargo Services from Mainland to Lakshadweep Islands and Functioning of Cochin Port Trust.

______

14. 18.9.2006 1-50 The Committee discussed draft Report on the India Tourism Development Corporation (ITDC). After detailed discussions the draft Report was adopted. However, since some Members of the Committee were having some points to be added in the Report, Chairman invited their suggestions in writing within a week’s time so that the same may be

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* Nominated w.e.f. 13.4.2006 vice Shri Nilotpal Basu

° Nominated w.e.f. 2.6.2006 vice Shri Rama Muni Reddy Sirigireddy

× Nominated w.e.f. 8.3.2006 vice Shrimati Ambika Soni

*Nominated w.e.f. 20.3.2007 vice Shri Manabendra Shah

incorporated in the Report. It was also decided that the Report would be presented in the House during the Winter Session of the Parliament. Thereafter, the Committee held preliminary discussion on the Aircraft (Amendment) Bill, 2006, which had been referred to the Committee for consideration and report.

15. 6.10.2006 1-50 The Committee heard the views of the Secretary of the Ministry of Civil Aviation on the Aircraft (Amendment) Bill, 2006.

Secretary, Ministry of Civil Aviation.

16. 27.10.2006 0-40 The Committee heard the views of the Experts on the Aircraft (Amendment) Bill, 2006.

(i) Shri Satendra Singh, Ex-Director-General, Civil Aviation; and

(ii) Shri V.K. Mathur, Ex-Chairman, Airports Authority of India

17. 5.12.2006 1-45 The Committee heard the views of the Chairman, Airports Authority of India on the Aircraft (Amendment) Bill, 2006.

Chairman, Airports Authority of India.

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