3 August, 2016
National Civil Aviation Policy, 2016
On June 15, 2016, the Ministry of Civil Aviation issued the National Civil Aviation Policy (‘Policy’), focusing on affordable air travel, improving connectivity, boosting tourism, infrastructure, sustainable development and job creation in tier-II and tier-III cities and tax/economic sops. The Policy covers 22 facets of Indian civil aviation including maintenance, repair and overhaul operations, ground-handling, security and customs. ‘Regional Connectivity’, being a key focus-area, the Policy encourages the development of regional airports and airstrips, provides incentives to airline operators to fly to less connected sectors and provides for a cross- subsidy between popular routes and regional routes.
Additionally, the erstwhile ‘5/20 Rule’ which provided that an Indian airline could operate on international routes only if it had previously operated for a period of five years on domestic routes and had a fleet of at least 20 aircraft, has been liberalised by permitting all airlines to commence international operations, provided that they deploy at least 20 aircraft or 20% of total capacity, whichever is higher, for domestic operations.
Other significant changes include the implementation of ‘open sky agreements’ (permitting Indian operators to launch both passenger and cargo flights to and from a range of coun- tries), development of greenfield and brownfield airports by the private sector, State governments and/or by a public-private-partnership, promotion of air cargo services to further the ‘Make in India’, e-commerce and export policies of the Government.
Defence Procurement Procedure, 2016
The Ministry of Defence, GoI (‘MOD’), has with effect from April 1, 2016 notified the new Defence Procurement Procedure, 2016 (‘DPP 2016’) for capital acquisitions in the Indian defence sector, to, inter alia, evolve a policy framework to facilitate the ‘Make in India’ initiative in defence manufacturing. Key changes to the defence procurement procedure include replacement of ‘Buy (Indian)’ category with the newly introduced ‘Buy (Indian – IDDM)’ category as the most preferred category for capital acquisitions, which places highest importance on indigenous design, development and manufacture. ‘Make’ category programs have been classified into sub-categories of ‘Make-I (Government funded)’, where 90% of the project is funded by the MOD and ‘Make-II (Industry funded)’ where the entire project is funded by the vendor.
DPP 2016 defines ‘Indian Vendor’. Further, the threshold of cost of procurement proposals for applicability of offset obligations has been raised. The request for proposal (‘RFP’), may, on case to case basis, now allow foreign vendors to engage agents in India for marketing of equipment manufactured by the vendor, subject to disclosures and conditions prescribed in the DPP 2016. Depending on the procurement requirement, the RFP may provide for meeting certain enhanced performance parameters as prescribed in the DPP 2016. As per the draft RFP, vendors may be required to provide confirmation at the time of submitting the proposal, that, inter alia, there would be no review, revocation or suppression of the relevant export license. Execution of integrity pact has been made mandatory for all procurement schemes exceeding ¤200 million (approximately US$ 2.98 million).
New Construction and Hazardous Waste Management Rules
The Ministry of Environment and Forests has: (i) on March 29, 2016, notified the Construction and Demolition Waste Management Rules, 2016, replacing the Municipal Solid Waste (Management and Handling) Rules, 2000; and (ii) on April 4, 2016, notified the Hazardous and Other Wastes (Management and Transboundary Movement) Rules, 2016 replacing the erstwhile rules of 2008.
For further information, please contact:
Zia Mody, Partner, AZB & Partners
zia.mody@azbpartners.com
