Government of India signs an MOU with CAE to provide pilot training in two schools

- More than 400 pilots would be licensed annually

Jun 19, 2007, 01:00 ET from CAE INC.

    LE BOURGET, Paris, June 19 /PRNewswire-FirstCall/ - (NYSE:   CGT; TSX:
 CAE) - CAE has signed a memorandum of understanding for a joint venture
 with the Airport Authority of India (AAI) to develop the National Flying
 Training Institute (NFTI). CAE has also signed a memorandum of
 understanding to become the managing partner of the Indian government's
 flight training academy: Indira Gandhi Rashtriya Uran Akademi (IGRUA).
     More than 400 pilots would be licensed annually through these new
 schools. The total output would grow to over 600 pilots with the Multi
 Pilot Licence (MPL) stream of licensing.
     "The selection of CAE by the government of India for these schools is a
 significant milestone for flight training in India," said Jeff Roberts,
 CAE's Group President, Innovation and Civil Training & Services. "Given our
 extensive experience in building world-class flight-training organizations,
 we intend to provide India with the expertise and support they need to
 develop a solid infrastructure and implement the most modern standards in
 flight training. With these new schools, which would complement our
 upcoming training centre in Bangalore, we will be able to address the need
 for pilots in India."
     "Creating these world-class institutions in-country with CAE as our
 partner is a major government initiative targeted at tackling both the
 acute shortage of Indian pilots while improving the overall quality of the
 cadet supply within India," said The Honourable Praful Patel, India's
 Minister of Civil Aviation. "Today there are approximately 2,500 active
 pilots in India and we estimate that we will need up to an additional 5,000
 pilots over the next 5 years to meet the needs of the industry. These
 initiatives will go a long way to help remedy our pilot shortage."
     Over the next decade, the rapid growth in air travel will generate an
 enormous demand for pilots, cabin crew, maintenance staff and
 infrastructure to support this growth. The Air Passengers Association of
 India estimates that the annual air traffic growth rate in the country has
 been around 26% over the past two years, causing the Indian airline
 industry to order approximately 400 new aircraft, to be delivered by 2010.
     Once final agreements are signed, CAE will offer these schools the
 possibility of becoming members of the CAE Global Academy. The CAE Global
 Academy is a worldwide network of flight training organizations that offers
 pilot candidates an optimized program with standard operating procedures.
 CAE currently has six member schools in its Global Academy and can license
 annually 1,000 pilots. Once they have graduated from the Academy, the new
 first officers are able to proceed for type-rating in one of CAE's training
 centres, including CAE's upcoming training centre in Bangalore. CAE has
 contracts with several airlines to supply them with pilots. CAE has
 recruited, trained and supplied more than 800 pilots for commercial
 airlines over the last year.
     Joint venture with AAI
     Under the terms of the memorandum of understanding, the National Flying
 Training Institute will be jointly owned by CAE and AAI. Located at GONDIA
 in the State of Maharashtra, the Institute will include a state-of-the-art
 facility equipped with classrooms, a hostel, a library, a workshop, a
 cafeteria, a guest house and a club. The school will operate new aircraft,
 and will use CAE's courseware and innovative training equipment. The total
 investment for NFTI is approximately US$25 million. When fully operational,
 it is estimated that the NFTI will create approximately 200 pilots a year.
     Managing partner of IGRUA
     Under the terms of the memorandum of understanding, CAE will manage
 IGRUA's existing flight school activities, including maintenance of
 aircraft, flying operations, air traffic control, runway maintenance, NAV
 aids, fire fighting facilities, medical facilities, security, staff and
 student facilities, as well as transportation.
     As part of the memorandum of understanding, CAE will transform IGRUA
 into a Centre of Excellence for India, leading the Indian market in the
 delivery of a complete range of high-quality aviation training programs.
 IGRUA currently licenses 200 pilots annually.
     Indira Gandhi Rashtriya Uran Akademi (IGRUA) is the Indian government's
 national flying school located at the Fursatganj Airport in Rae Bareli.
 Opened in 1986, it is equipped with aircraft including a Trinidad TB-20, a
 King Air C-90A and a Zlin 242L. It also includes a full-flight simulator
 for a King Air C-90A and cockpit procedure trainers for the Trinidad TB-20.
 IGRUA currently employs 250 people.
     CAE is a world leader in providing simulation and modelling
 technologies, and integrated training services to the civil aviation
 industry and defence forces around the globe. We design, manufacture and
 supply simulation equipment and offer training and services. This includes
 integrated modelling, simulation and training solutions for commercial
 airlines, business aircraft operators, aircraft manufacturers and military
 organizations and a global network of training centres for pilots, and in
 some instances, cabin crew and maintenance workers.
     With annual revenues of over C$1 billion, CAE operates in 19 countries
 around the world. CAE has sold nearly 700 simulators and training devices
 to airlines, aircraft manufacturers, training centres and defence forces
 for air and ground purposes in more than 40 countries. We have over 110
 full-flight simulators in more than 20 aviation training centres, serving
 approximately 3,500 airlines, aircraft operators and manufacturers across
 the globe. CAE licenses its simulation software to various market segments
 and has a professional services division assisting customers with a wide
 range of simulation-based needs.