IGRUA’s financial statements show that the last grant (Rs 5 crore) it received from the government was in 2014-15. According to Budget documents, the government made token provisions for the institutions but never released the money. For instance, in 2017-18, it made a nominal allocation of Rs 10 lakh for “creation of capital assets”. The money was never released. A similar provision was made in the previous Budget, too.
Traditional funding from third-party non-central government sources has also dried up for IGRUA. Earlier, it received grants from the Uttar Pradesh government, United Nations Development Programme (UNDP) and US plane maker Boeing. In all these years, no government — not even the previous BJP administration under Atal Bihari Vajpayee — had stopped government grants to one of India’s leading pilot training institutes.
In 2014-15, when IGRUA reported receiving its last capital grant, the Rs 5 crore allocated to it was almost a fifth of its income that year. Business Standard tried contacting IGRUA director Krishnendu Gupta over his office phone and email had not received any response till the time of publication of this report.
IGRUA is an autonomous body under the civil aviation ministry. The country has 31 other pilot training schools which are operated by state governments and private players. Reports suggest that these schools manage to churn out around 350 pilots a year, despite having a capacity to train almost 1000, partly because of the high cost of pilot training in India.
The non-release of grants would have a significant impact on IGRUA’s operations. The institute charges Rs 42 lakh from every student selected for the course, even as the actual training expenses are Rs 45 lakh. This gap, according to IGRUA, is bridged by government grants; no other subsidy in this basic training fee is given to students, even those from the reserved category.
IGRUA generally has 100 seats available every year. Of these, 60 per cent are reserved for various categories, including those from economically weaker sections. In effect, it under-recovers Rs 3 crore annually from training students in a two-year course to obtain commercial pilot licences.
In its annual report, IGRUA stated that it is a grantee institution and “a large part of its expenditure is borne by the Government of India through capital and revenue grants”. Its losses have also mounted over the years. According to its last financial statements, filed for 2017-18, its expenses exceeded its revenues by Rs 14 crore. This was more than twice its under-recoveries of Rs 6 crore in 2014-15. Over the years, IGRUA has received Rs 105 crore from various governments, primarily from the central government, as revenue grants. A similar amount has been received as capital grants. Since 1987, a part of these revenue grants were also received from Air India and the erstwhile Indian Airlines. Revenue grants from Air India were discontinued in 2007-08.
There could be several implications of cutting off funding to IGRUA. The institute has a fleet of 24 training aircraft, including 13 Diamond DA 40s, five Trinidad TB 20s, four Zlin Z242L’s and two Diamond DA 42s. In 2017, a departmentally related standing committee had found that 40 per cent of this fleet was due to complete its technical life by 2020. With IGRUA not in a position to fund the acquisition of its own aircraft without government support, it could be forced to radically reduce not just its student intake but also other special training courses for Indian Navy and India Coast Guard pilots.
A part of the high operational expenses of IGRUA were also attributed by the committee to the use of aviation turbine gas instead of diesel in its planes. Aviation turbine gas costs almost a third more than diesel. The civil aviation ministry had also proposed a ‘Business Action Plan for IGRUA’ in 2017. This involved “increasing the training fees in stages to enhance income received, replacing the aircraft nearing the end of their technical life with diesel-engine planes, and replacing all remaining aircraft in the long term with diesel-engine aircraft”. There were no plans to increase the fleet size. However, little seems to have come of the so-called business action plan for IGRUA.