Sunday, March 10, 2013

AirAsia's India entry to mark arrival of truly low-cost airline; may face delay in clearances

Flying into India is a feast for the eyes. Depending on which part of the world a traveller enters from, the country's diverse natural splendour unfolds through a succession of mountain peaks, snaking rivers and swathes of pristine-green plains. Then, it is time to land. The spectacular imagery from the clouds is replaced on the ground by a succession of planes, snaking queues and swathes of security personnel.
The ambition of AirAsia, Malaysia's biggest low-cost carrier, to launch an airline venture in India is a bit similar. From afar, India looks a promising aviation market; rewards seem certain thanks to its immense growth potential and the yearning of its growing middle class to travel by air. Up close, something ugly is lurking due to the regulatory maze, absurdly high costs and competitors that embody the Darwinian concept of survival.
AirAsia, which partnered the Tatas and Arun Bhatia of Telstra Tradeplace last month for the airline venture, cleared the first hurdle last week when it received permission from the Foreign Investment Promotion Board, the nodal agency for investments from abroad.
10/03/13 Binoy Prabhakar/Economic Times