‘Indian government should not regulate air fares'

The International Air Transport Association (IATA), the global body for 240 airlines and managing 85 per cent of global air traffic, has advised the Indian Government not to regulate fares. It also feels the current situation is not conducive for domestic carriers to attract foreign capital. Mr Tony Tyler, Director-General and CEO of IATA, recently spoke to a select group of Indian mediapersons, including Business Line.
Excerpts from the interview:
The Government is considering allowing foreign airlines to pick up equity in Indian domestic carriers. How do you view such a move when all Indian carriers, except one, are in the red?
Investing in a loss-making business is obviously not a winning strategy. But certainly, Indian laws are very restrictive on foreign investments in airlines.
If the Government liberalises the FDI policy, you will see foreign money coming into the aviation market, because it is a rapidly growing market. Therefore aviation-friendly policies are required, particularly lifting the dead-weight of taxation.
Have you got any sense from foreign carriers about putting money in Indian carriers?
In today's difficult environment, generally speaking, many airlines are trying to keep their balance sheet strong rather than investing in other airlines. If foreign investment in airlines is allowed, investments from different kinds of sources will arrive.
12/2/11 Shishir Sinha/Business Line

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Categories: Indian Aviation- In General Dec 2011