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Govt may ease norms for new airlines to fly abroad

Govt may ease norms for new airlines to fly abroad
The Civil Aviation Ministry is examining a proposal to either completely scrap the rule that allows an Indian carrier to operate international flights only after it has flown domestic for five years and has a 20-aircraft fleet, or change the rules to one year of domestic flying and having a five-plane fleet, they said.

However, such a change or scrapping the rule, popularly called 5/20, would have to be decided upon by the Union Cabinet, they said, without elaborating as to by when this was likely to happen. A change in the rules would have an immediate impact on carriers like AirAsia India, Air Costa or the proposed Tata-Singapore Airlines joint venture Vistara.

The older carriers have been consistently opposing any change in the 5/20 rule.

In September, Civil Aviation Minister Ashok Gajapathi Raju Pusapathi had met CEOs of all Indian airlines, where four of them— Air India, Jet, IndiGo and SpiceJet — had sought retention of the 5/20 rule.

But Raju had then said, ‘I don't see a reason why the 5/20 rule should be there. The government cannot keep everyone happy. We will take a call on 5/20 soon.’

While the rule came into existence during the UPA-I government headed by Manmohan Singh, UPA-II had initiated the process of junking it but could not finish the task.

Those favouring the 5/20 rule feel that it would enable the new air carriers to stabilise not only their financials but also the standards of their services so that they can compete with the best of the foreign carriers when they operate to global destinations.

Those seeking abolition of this rule argue that it has enabled foreign airlines to capture a large share of India's international air travel market at the expense of home carriers.

Quite a few newly-formed foreign airlines, especially those in the Gulf and Southeast Asia, have also been operating in and out of India, taking a large chunk of Indian fliers, according to them.

A section of experts also feels that the financials of several Indian carriers could have been stronger if they had been allowed to launch international routes earlier, rather than asking them to wait for five years.

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