Civil aviation sector has gone into deep trouble in the last couple of years, with near bankruptcy of Kingfisher airlines and rising losses of other carriers. To rescue them from financial troubles, some aviation companies have been lobbying for easing norms for foreign investment in this sector. Significantly, though 49 per cent foreign investment was permitted in civil aviation sector, Indian companies were not allowed to sell their shares to foreign companies prior to September 2012. These companies can now also sell their shares to foreigners up to 49 per cent. Public sector carrier, Air India is on the brink of bankruptcy. Some time back, government gave Rs 30,000 crore rescue package to Air India. Private companies also wanted similar package, but the government flatly declined it.
Twenty years ago airways journey was limited to the politicians, bureaucrats and other members of the rich men’s club. When annual per capita income in the country, at current prices, was only Rs 5,500 minimum one-way fare from Delhi to Mumbai used to be between Rs 6,000 and Rs 8,000. There was total monopoly of government carriers in civil aviation. Time changed and in 2011, Delhi to Mumbai fare (similarly other sectors’ fares too) reached Rs 2,500 one-way, though by that time the country’s per capita income had reached Rs 53,000. If we take account of inflation in the country, fares today appear cheaper even after 20 years. Impact of all this was that, air travel, which was limited to the top less than half percent of population, now came within the reach of the common man.
01/02/13 Ashwani Mahajan/Deccan Herald
