Barely six months after the civil aviation ministry announced a policy to promote regional connectivity with the regional airline policy, many of the approved airlines are not too happy despite the humongous growth potential that this particular area of India?s civil aviation sector has.
The ministry of civil aviation has so far approved five airlines to operate on the new regional airline policy giving them a number of sops to help them ensure financial viability.
The approved regional airlines include MDLR, Jagson Airlines, Star Aviation and Zav Air and Air Dravida while others like Mega Airways and Premier Airlines are still awaiting approval.
Under the new policy, regional carriers can fly small aircraft (below 40,000 kg) and are exempt from airport and navigation charges and pay sales tax of only 4% on aviation fuel as against more than 30% paid by national carriers. Regional carriers can start operations with only one aircraft (instead of five for national carriers) and an equity base of Rs 12 crore (instead of Rs 50 crore).
But these carriers are only allowed to operate around one metro (except in the south, where they can operate around Hyderabad, Chennai and Bangalore). ?As per our research, this area will see huge growth,? UK Bose, COO of MDLR airlines said. ?And as a carrier airline goes to the regional destinations, the traffic from these tier II and tier III towns will grow almost immediately,? Bose said. ?The ministry should allow for a regional carrier to go to another metro with one hop,? he added.
?The government has to see that the national players restrict operations on the routes on which regional players operate since regional players are not allowed to fly on the routes these carriers are flying,? said J P Gupta, chairman of Jagson Airlines.