Easier rules for new airlines to fly abroad? Not really

VISTARA AND AIRASIA INDIA MAY NOT BE ABLE TO FLY TO LUCRATIVE SHORT-HAUL FOREIGN DESTINATIONS

NEW DELHI: The government may scrap the contentious 5/20 aviation rule, but domestic airlines are unlikely to gain.

The 5/20 rule bars domestic airlines from starting international flights till they have a fleet of 20 aircraft and flying experience of five years.

The aviation ministry has now proposed a complex new formula, as per which the new airlines would initially only get to fly to destinations that are more than six hours away.

They would have to earn double the domestic flying credits (DFCs) to fly to destinations that are less than six hours away.

The ministry has connected DFCs earned by airlines to permission for operating international flights.

This would in effect bar start-ups such as Vistara and AirAsia India from flying to lucrative short-haul international destinations of less than six hours such as Singapore, Thailand, Malaysia and the Gulf and the West Asia.

No Indian carrier, except Air India and Jet Airways, has aircraft that can fly over six hours, and they already fly to international destinations. “This means that no new airline will be in a position to start international operations. Why abolish the 5/20 rule if you want to replace it with even a more complex regulation?” questioned a senior airline official.

“I am extremely disappointed with government’s new proposal...Someone is advising the government wrongly,” said Kapil Kaul, South Asia CEO of aviation consultancy Centre for Asia Pacific Aviation (CAPA).

“Expected government to make doing business in India easier, but this proposal will make it difficult,” he said.