Airlines must ferry more equity

New Delhi: The government has increased the paid-up equity capital requirement for domestic airlines to qualify as scheduled operators by about 70%.
The restriction on scheduled carriers to have at least five aircraft to start operations has, however, been relaxed. The ministry has decided to permit scheduled airlines to commence operations with just one aircraft.
As per the new norms, an airline operating with large aircraft having a takeoff mass exceeding 40,000 kg will need a paid-up equity of Rs 50 crore, up from the earlier Rs 30 crore. In case of a carrier having aircraft with takeoff mass less than 40,000 kg, the paid-up capital requirement has been increased to Rs 20 crore from Rs 10 crore. The revised norms shall apply to airlines having a fleet size of five aircraft.
For every subsequent addition of up to five aircraft, additional equity of Rs 20 crore will have to be infused in case of companies operating big jets such as Airbus A-320s or Boeing 737s. In the case of airlines using smaller aeroplanes such as turboprop ATRs and Dorniers, Rs 10 crore of additional equity would be required for every addition of five aircraft.
30/03/07 Economic Times

To Read the News in full at Source, Click the Headline

Categories: General Aviation Mar 2007, New Mar 2007