India’s union cabinet has approved the national civil aviation policy in order to make flying more affordable for the country’s growing middle-class, and encourage competition and regional connectivity.
The new policy has abandoned the 5/20 rule, which requires domestic airlines to operate for five years before they can fly abroad and deploys at least 20 aircraft.
However, according to the new policy, carriers can start international operations if they operate 20 aircraft or 20% of total capacity, whichever is higher, for domestic operations.
India’s Aviation Minister Ashok Gajapathi Raju was quoted by Reuters as saying: "We need more airlines, more aircrafts serving our Indian skies, so if more airlines want to come to India they are welcome."
Apart from helping Tata Group’s two latest ventures with Singapore Airlines and Malaysia’s AirAsia, the new policy will also encourage other foreign airlines to enter the country.
A JV between Tata Group’s and Singapore Airlines, Vistara currently operates ten jets, while AirAsia India has six A320 planes.
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By GlobalDataLast year, India’s number of passengers flying on domestic routes had increased by 21% to more than 80 million and the government intends to raise that number to 300 million by 2022.
The new aviation policy has capped base fares on regional routes at Rs2,500 ($37) for a 1h flight between a metro and a small city.
Financial support for new ‘no-frills’ airports will also be provided and excise duty on fuel will be reduced according to the policy, which also aims to improve the employment scenario for the commercial pilot licence (CPL) holders, who remain jobless after their course due to the difference in the demand and supply of pilots, reported dna.
