Is India’s national carrier Air India heading towards a slow but certain death after more than six decades of unhindered service? If so, the Government is itself to blame.
Ever since the Government allowed operation of private carriers as part of its open sky policy under the overall economic reforms agenda that began in the early 90s, first the then PSU domestic carrier Indian Airlines began losing revenue. The international arm Air India held aloft for some time but soon started giving in to pulls and pressures from both the industry and the Government. The merged entity Air India may now be in deeper mess.
The immediate cause for concern is the soon to be announced scrapping of what is known as the 5/20 rule which may give a body blow to Air India. Under this rule, an airline is required to operate for a minimum of five years and must have at least 20 aircraft in its fleet before it is allowed to fly on international routes.
Abolition of this rule will be a game changer. Private carriers, particularly the new entrants, will hugely gain from it at the cost of Air India. The beneficiaries will be Vistara, a joint venture of Tata Sons and Singapore Airlines which just completed one year of operation this month, and Air Asia both of whom are waiting for the announcement. Indeed, the industry sources claim the two have been putting pressure on the Government.
23/01/16 Devsagar Singh/Echo of India
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Ever since the Government allowed operation of private carriers as part of its open sky policy under the overall economic reforms agenda that began in the early 90s, first the then PSU domestic carrier Indian Airlines began losing revenue. The international arm Air India held aloft for some time but soon started giving in to pulls and pressures from both the industry and the Government. The merged entity Air India may now be in deeper mess.
The immediate cause for concern is the soon to be announced scrapping of what is known as the 5/20 rule which may give a body blow to Air India. Under this rule, an airline is required to operate for a minimum of five years and must have at least 20 aircraft in its fleet before it is allowed to fly on international routes.
Abolition of this rule will be a game changer. Private carriers, particularly the new entrants, will hugely gain from it at the cost of Air India. The beneficiaries will be Vistara, a joint venture of Tata Sons and Singapore Airlines which just completed one year of operation this month, and Air Asia both of whom are waiting for the announcement. Indeed, the industry sources claim the two have been putting pressure on the Government.
23/01/16 Devsagar Singh/Echo of India
