New Formula Seeks to Give Wings to Foreign Airlines’ India Expansion
New Delhi: Foreign airlines will now be able to offer more seats on routes to India in cases where domestic carriers have not been able to utilise even one-third of the capacity as per their entitlements under bilateral air services agreements.
A committee of secretaries has issued an order to this effect, devising a new formula to calibrate the opening up of Indian skies to genuine demands of overseas carriers. The panel, headed by the cabinet secretary, was constituted to discuss reforms in bilateral air services agreements, including auctioning of rights.
“With countries where Indian carriers have not utilised even one-third of the total seat entitlements and do not have any immediate plans, the panel is of the view that bilateral entitlements should be increased,” said an aviation ministry official, who did not want to be identified.
Another cost component that has recorded an increase over the years is interest relative to operating profit (EBIT). The ratio was at 26.5%, the highest since the June 2014 quarter, when it was 22.1%.
On the sector front, compa- nies from the automobile, capital gods, cement, construction, consumer goods and textile sectors reported growth in net profit at the aggregate level. On the other hand, pharma, power, realty, retail, steel, telecom sectors reported a decline in profit.
The satisfactory monsoon in several parts of the count- ry and higher sowing activity should support rural spending in the quarters to come. The festive season in the September and the December quarter will add more momentum to consumption demand. Industrial demand may, however, remain tepid considering there aren’t any major signs of capital expenditure and efforts by debt-laden companies to seek financial restructuring.