Air Asia India and Vistara expected to Start Overseas Flight Next Year


New Delhi: Rajan Mehra, MD for India & South Asia at Jets conveyed that, after the current modify in aviation rules, Vistara and AirAsia India could start international services in a year. On Wednesday the government accepted the long-pending National Civil Aviation Policy. Under the new policy, domestic carriers will no longer have to operate for five years before they fly on overseas routes, earlier known as 5/20, provided they deploy 20 planes or 20 per cent of their total capacity for domestic operations. The high point of the new aviation policy seemed to be the rule relaxing the airlines to fly overseas with just 20 aircraft and without the need to have been in the business. The instant recipient of course is the Vistara Airlines, promoted by the Tata in partnership with the Singapore Airlines. Vistara and Air Asia would not be the only beneficiaries. Additional entrants can take advantage of it as well. The idea at the back it is to integrate Indian aviation into the global network, which is seen to be a way of boosting economic growth through tourism.

It is that of increasing, intensification and strengthening  air network inside the country since connectivity is seen as an essential part of building infrastructure. The point is to reach smaller and remoter places in the country. There is little doubt that India needs to be better connected than it is now, and flying planes to the smaller and remote corners could be an effective way of doing so. Overall, the new civil aviation policy is positive for the long-term growth of the industry. Mr Mehra said abolition of the five-year requirement is positive for the industry as it will make international fares more competitive and promote tourism. The government also capped base fares on regional routes at Rs 2,500 per hour of travel to promote regional connectivity. The airlines would be partly compensated to make the regional routes viable. According to Crisil, Currently 90 per cent of the MRO work for domestic airlines is being carried out in Sri Lanka, Dubai and Hong Kong. To frame an aviation policy that is focused on more planes, more airports and more fliers may not be the right thing to do.