Sunday, March 10, 2013

New players check-in to take off in domestic aviation sector

It might be early days yet, but the flurry of positive activity over the last month could provide the domestic aviation sector something to cheer about. After months of cancelled flights and then the shutting down of Kingfisher Airlines, things could be getting better.
First came the news of a possible tie-up between Jet Airways and the Abu Dhabi-based Etihad Airways. Then, on March 6, the Foreign Investment Promotion Board (FIPB) granted in-principle clearance to the Malaysian low-cost airline, AirAsia’s proposal to set up a domestic airline in India jointly with Tata Sons and Telestra Trade Place Pvt Ltd.
Then there is also the Singapore based low-cost airline, Tiger Airways, which is also looking at expanding operations in India.
Of course, there are initial hiccups. AirAsia’ proposal did not go down well with the Ministry of Civil Aviation which sought clarifications on FIPB’s in-principle clearance to the airline to start operations. The Civil Aviation Ministry has sought clarifications on whether the policy change allows foreign direct investments by foreign carriers only in existing airlines or whether new start-up carriers are also included in this.
09/03/13 Ashwini Phadnis/Business Line