The civil aviation ministry has put forward a document that will encourage the growth of competing regional airlines so that cut-rate fares reach hinterland too.
Easier licensing, cheaper ATF also on the cards.
NEW DELHI: The civil aviation ministry has put forward a policy document that will encourage the growth of competing regional airlines so that cut-rate fares reach the hinterland, too.
The policy says that the director-general of civil aviation (DGCA) will be asked to notify 500-600 km routes where regional airlines will be licensed with new norms on fleet strength and maintenance infrastructure.
The policy, which will be taken up for consideration by the Union cabinet shortly, has called for a systematic lowering of costs by rationalising duties on aviation turbine fuel (ATF) by making it a "declared good" under the Central Sales Tax Act. The prices of ATF will be kept competitive by allowing even foreign suppliers to sell fuel.
The policy provides for the regulation of airport charges by setting up a regulator. Besides, the document also makes a case for revamping the Airports Authority of India (AAI) and hiving off its consultancy, architectural, cargo and ground-handling and construction wings as subsidiaries.
The paid-up equity requirements of all private scheduled operators is planned to be raised under the new policy.
Airlines operating a minimum of five aircraft, with takeoff mass exceeding 40,000 kg, will need to have a minimum paid-up equity of Rs 50 crore as against the present Rs 30 crore. For each addition of up to five aircraft, additional equity investment of Rs 20 crore will be required.
Airlines operating five aircraft, but with takeoff mass not exceeding 40,000 kg, will need to have paid-up equity of Rs 20 crore as against the present Rs 10 crore. For each addition of five aircraft in this case, additional equity investment of Rs 10 crore will be required.
Security and safety will be the responsibility of the government.
The policy proposal says the security component of the passenger service fee, currently comprising 65% of the fee, will be deposited with the government to meet expenditures on security.
Importantly, the government will not permit the induction of aircraft that are older than 12 years, be it for scheduled or non-scheduled passenger operations or for private use. The restriction may not apply to aircraft used for exclusive cargo operations.
With regard to ground handling, there will be a minimum of two authorised ground-handling service providers at each airport depending on traffic.
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