Saturday, August 29, 2015

Airlines 5/20 Policy - Policy Revision Suggestions

5/20 Relaxation Effects: Airlines who are subsidiaries of foreign companies with base outside India will use relaxation in policy to fill fuel outside India and continue to use same aircraft for domestic travel instead of fuelling in India as cost of ATF fuel is high in India. Example: Air Asia with base as Malaysia and Petronas a Malaysian govt company will benefit, Singapore airlines also will benefit and Indian airline companies will not be profitable. This is a hidden point behind pushing of rules by foreign airlines to get foreign routes to profit faster and we will lose revenue from sale of fuel from public sector oil
5/20 if relaxed will put govt in legal battles as many companies which are struggling to get out of debt. So govt should setup a separate committee to review 5/20 policy alone since any govt decision will be seen as favouring some companies like air Asia and vistaraleading to problems at parliament and legal later. Even Air India will lose market severely if rules are relaxed so easily for new comers without much sub clauses
Generally more the aircrafts the employment will be high and growth and revenue but years don’t matters so aircrafts policy must be minimum 15 aircrafts. The below ideas will be simple and neutral stand to old airlines and protect public from reduced domestic flights by operating more flights abroad in near future. At the same time give opportunity for new ones to try to enter Indian market with more aircrafts so that they can get to fly abroad in 3 years which is a short time frame in airline industry for their high investment
The year rule should be kept at minimum 2 years to check their operation by AAI, passengers, Govt and security and 2 years will promote more airline ventures to try as 2 years is small time frame for them.
All airlines are plying only in heavy demand route and smaller airports don’t have direct flights or very less flights and less growth and loss operations. So flights from these small airports which currently there is not much traffic to foreign airports directly & mainly without immediate transit in India before going to foreign airports should get maximum relaxation in rules like 2/10 will promote travel and revenue to these small airports. These airports list govt must revise every 1 year. The list should not include any airports from which there are any international flights currently or from immediate transit of 4 hours. If airlines really want to fly govt can give Ex: Manali, Tirupathi. But aircraft's increased at 3 per year till 5/20
Or 3 years/35 or 3 years/40 & aircraft's count should be kept high above current limit of 20 so that domestic traffic is not affected on the verge of foreign trips by these aircraft's to fill fuel at low cost or the count of aircraft's at least close to what existing airlines have without affecting their operations. If 3/30 or 3/35 not viable for them they can wait till 5/20 rule.
Or 4yrs/30 or 4yrs/25 aircraft's so that new entrants can feel they have less years to go to target and old airlines feel that they got some benefit. If new airlines cant meet then they can wait till 5/20 rule.

No comments:

Post a Comment