Top airline honchos today met Prime Minister Manmohan Singh, seeking his intervention to help them face the ?bad operating climate? and come out of the deep financial crisis. The meeting lasted about an hour, and though the industry bosses suggested measures like rationalising taxes and duties on jet fuel prices and other items to help the ailing industry, the PM did not give them any specific assurance, sources said. He, however, is understood to have said that the government would be ready to help cash-strapped carriers address their ?legitimate grievances?.
Sources said the new ground handling policy, which bars carriers to undertake self-handling of passenger check-in and fueling and cleaning of airplanes, high airport charges and unutilised traffic rights were also taken up in the meeting.
?Airlines were divided on some of the issues and it was quite visible in the meeting. While Jet and IndiGo differed in their views on some issues, the two did not agree with Kingfisher on others,? said an official. Sources said GoAir owner Jeh Wadia proposed to allow foreign airlines to pick up stake in Indian carriers, arguing it was needed for growth.
?The issue of foreign airlines investing in Indian carriers was not on the agenda, but was added as sixth item in the later part of the meeting when Wadia made a case for it,? said the official. The PM is learnt to have said that the issue of allowing foreign airlines was being examined.
Those who attended the meeting included Jet Airways chairman Naresh Goyal, IndiGo co-promoter Rahul Bhatia, IndiGo president Aditya Ghosh, SpiceJet CEO Neil Mills, Kingfisher CEO Sanjay Aggarwal and GoAir owner Jeh Wadia. GMR group chairman GM Rao was also in attendance. The airline bosses later had a meeting of their own to discuss the issues in-depth, said sources. Interestingly, Kingfisher Airlines chairman Vijay Mallya, who has been making a strong pitch for allowing foreign carriers to buy equity stake in domestic carriers, did not attend the meeting.
?Nobody expects a solution to come overnight. The airlines? problems are complex and it would take a reasonable time frame of six-eight months to address them. This is just the beginning of a very serious engagement,? Centre for Asia Pacific Aviation (Capa) India head Kapil Kaul said.
?The problems are not airline-specific. The entire industry is finding the operating environment challenging,? Jet Airways chairman Naresh Goyal had told FE on Friday.
The domestic airline industry is facing headwinds, with input costs rising and yield falling due to excess capacity in the market. The three public-listed companies ? Jet Airways, Kingfisher Airlines and SpiceJet ? have reported a combined net loss of R1,422 crore in the quarter ending September 30. It?s estimated that the combined loss of all the carriers would touch R15,000 crore in the current financial year, with Air India contributing over 60% of it.