Date
24 March 2017
IndiGo and SpiceJet are leading the pushback against the planned rule change that would make it easier for domestic carriers to offer international flights. Photo: WSJ
IndiGo and SpiceJet are leading the pushback against the planned rule change that would make it easier for domestic carriers to offer international flights. Photo: WSJ

India planning to ease aviation rules for international flights

India is making it easier for domestic airlines to offer international services.

That means domestic carriers will not have to wait at least five years to qualify for an overseas permit, Bloomberg reports.

The move will benefit the local affiliates of Singapore Airlines Ltd. and AirAsia Bhd., three people familiar with the process said.

The cabinet may consider the new policy as early as Wednesday although an official agenda isn’t ready yet and delays are usual.

The government is debating whether to keep the minimum number of aircraft an airline should have in its fleet at 10 or 20, they said.

Existing rules mandate that airlines must have a fleet of 20 planes to fly abroad.

A change will enable carriers to start flying overseas immediately if they meet the minimum fleet requirement, dealing a blow to airlines such as Interglobe Aviation Ltd.’s IndiGo and SpiceJet Ltd., which had previously opposed such a relaxation of what is locally known as the 5/20 rule.

Singapore Air started flying domestic flights in India through a joint venture known as Vistara.

AirAsia, the region’s biggest discount carrier, began domestic Indian flights in June 2014.

A draft of the new civil aviation rules released in October said the 5/20 rule could be kept, amended or scrapped.

India is evaluating as many as 15 variations to amend the rule, R.N. Choubey, the top bureaucrat in the aviation ministry said March 16.

Incumbent carriers like market leader IndiGo and SpiceJet have said scrapping the rule unduly favors new airlines.

Businessman Ratan Tata, former chairman of Tata Sons Ltd. that partners both Vistara and AirAsia India, has said the rules were “reminiscent of the protectionist and monopolistic pressures by vested interests who seem to fear competition”.

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