AirAsia chairman S Ramadorai said on Thursday the 5/20 rule, currently in effect in the aviation sector, is an artificial barrier that needs to be removed. Ramadorai said the 5/20 rule was critical for the sector and why it had been brought in was not clear. “If there is a third player, he should be allowed to fly anywhere too,” Ramadorai observed at the Indian Express’ Idea Exchange programme.
Ramadorai observed that AirAsia was trying to create a market for first-time travellers.
“We are not taking away the market from anybody. As long as there is a standard runaway in the Tier II or Tier III cities, we are willing to fly anywhere and create the market. We have the sustaining power,” Ramadorai observed. The taxes on fuels, he felt, needed to be reduced. “Ultimately, all of the cost will have to be borne by you and me,” he observed.
Ramadorai said every form of revenue needed to be disaggregated. The route selection based on the traffic, the number of flights on the route, and the price at which seats could be sold, the variability of seat selling depending on where passengers wanted to sit, all needed to be disaggregated. “Let market forces determine the price. If I feel I want to subsidise a route to build the traffic, I should be able to do it. These are the kind of things we have been asking for. The rule of the game is disaggregation and letting market forces decide what is the best price,” the chairman said. The chairman also noted that pilots and engineers were very critical to the aviation industry because the building trust came through them.
Ramadorai, also chairman of the National Skills Development Corporation, said in India, skilling the youth is a “scale problem” because of the demographics and the need for jobs and entrepreneurship adding implementation has to happen at the local level.
“Merely going by achievements, saying we have funded so many people and disbursed so much money or loans, is not the way to look at it,” he said, adding unless there was a collaborative effort, it would be difficult to create the number of jobs needed. Under the 12th Five Year Plan, the country needed to train and place at least 8 million every year.
“We are far from the target,” Ramadorai said, adding the NSDC plan is a long-term mission.
Ramadorai said that the NSDC is now working on bringing in National Occupation Standards by which it will determine the curriculum with help of sector-specific skill councils, which will allow institutions to offer certifications to the people trained through such organisations. The certification of skill sets will be mandatory in the next five years.
“We want the certification to be linked to the wages,” Ramadorai added. The NSDC was set up in 2008 to promote skill development by catalysing creation of large, quality, for-profit vocational institutions, to help crore of unemployed and under-employed youth in the country to get trained and get into mainstream jobs, mostly in vocational streams.