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NEW DELHI: Vistara and AirAsia India may soon be able to fly international, as Prime Minister Narendra Modi has favoured scrapping of the 5/20 eligibility rule that bars Indian carriers from flying overseas until they complete five years of domestic service and have a fleet of 20 aircraft.
The PM made his views clear during a meeting on August 25 to discuss the new civil aviation policy, which is being formulated. Removal of the 5/20 rule is part of the proposals. The meeting was also attended by ministers of civil aviation, finance and skill development & entrepreneurship, as well as top officials of the aviation ministry.
Modi told the meeting that the rule should go and no alternative should be introduced, said an official who attended the meeting. "If the rule is stifling the growth of our carriers, the rule should completely be abolished and not replaced. What is the need to replace a rule with something when the rule itself is not pro-growth," the official said, quoting Modi.
The decision to remove the 5/20 rule is final, the official said.
"The ministry would, however, still seek public consultation on either to replace or to completely abolish 5/20," the official said. The draft policy may be published by the end of this month seeking public comments. Aviation Secretary RN Choubey didn't reply to an SMS and phone calls seeking comment on the discussions while a civil aviation ministry spokesman said he could not comment on the matter.
Jagdish Thakkar, a public relations officer at the Prime Minister's Office, didn't respond to an SMS, email and phone calls.
Removal of the regulation is set to widen the divide between the newand old carriers. Jet Airways, the nation's oldest private airline, as well as IndiGo and SpiceJet, which had to meet the conditions under the 5/20 rule before they were allowed to fly overseas, are against its abolition.
According to them, scrapping of the rule would give new entrants an unfair advantage. Vistara and AirAsia, the newest airlines in India, want the rule to go. The civil aviation ministry has been considering removal or replacement of the 5/20 rule for 15 months, but has not been able to decide.
The meeting late last month considered several options to replace the 5/20 rule, the official said.
Apart from lifting all restrictions, which the prime minister favoured, these included a domestic flying credits formula requiring 300 points for flying international and a requirement to deploy at least 5 aircraft in the domestic sector.
Analysts supported the PM's suggestion to abolish the rule, which, one of them said, promotes restrictive and negative regulations.
"No one except Jet Airways has benefited from 5/20 regulation and it is time to correct this distortion immediately," said Centre for Asia Pacific Aviation Chief Executive Kapil Kaul.
"The country cannot continue with our policy of liberalising for foreign carriers and restricting/constraining the Indian carriers," he said. "This does not happen anywhere and cannot be supported."
ET View: International Skies are the Limit
Warped policy must not prevent the newer domestic carriers from flying abroad. We do need to reform and liberalise the restrictive rule. Artificially hampering connectivity will be at a huge national cost. We are able to utilise only a small fraction of our bilateral code-share agreements. Foreign airlines provide the bulk of carriage. So, it is vital that more Indian carriers fly to international destinations. It will provide more choice for passengers, allow Indian carriers to better meet demand, and improve their bottom lines. Let their ambitions soar.
Read more at:
Flying high! PM Narendra Modi favours scrapping of 5/20 rule for Indian airlines - The Economic Times
@third eye @Chanakya's_Chant @Mike_Brando
The PM made his views clear during a meeting on August 25 to discuss the new civil aviation policy, which is being formulated. Removal of the 5/20 rule is part of the proposals. The meeting was also attended by ministers of civil aviation, finance and skill development & entrepreneurship, as well as top officials of the aviation ministry.
Modi told the meeting that the rule should go and no alternative should be introduced, said an official who attended the meeting. "If the rule is stifling the growth of our carriers, the rule should completely be abolished and not replaced. What is the need to replace a rule with something when the rule itself is not pro-growth," the official said, quoting Modi.
The decision to remove the 5/20 rule is final, the official said.
"The ministry would, however, still seek public consultation on either to replace or to completely abolish 5/20," the official said. The draft policy may be published by the end of this month seeking public comments. Aviation Secretary RN Choubey didn't reply to an SMS and phone calls seeking comment on the discussions while a civil aviation ministry spokesman said he could not comment on the matter.
Jagdish Thakkar, a public relations officer at the Prime Minister's Office, didn't respond to an SMS, email and phone calls.
Removal of the regulation is set to widen the divide between the newand old carriers. Jet Airways, the nation's oldest private airline, as well as IndiGo and SpiceJet, which had to meet the conditions under the 5/20 rule before they were allowed to fly overseas, are against its abolition.
According to them, scrapping of the rule would give new entrants an unfair advantage. Vistara and AirAsia, the newest airlines in India, want the rule to go. The civil aviation ministry has been considering removal or replacement of the 5/20 rule for 15 months, but has not been able to decide.
The meeting late last month considered several options to replace the 5/20 rule, the official said.
Apart from lifting all restrictions, which the prime minister favoured, these included a domestic flying credits formula requiring 300 points for flying international and a requirement to deploy at least 5 aircraft in the domestic sector.
Analysts supported the PM's suggestion to abolish the rule, which, one of them said, promotes restrictive and negative regulations.
"No one except Jet Airways has benefited from 5/20 regulation and it is time to correct this distortion immediately," said Centre for Asia Pacific Aviation Chief Executive Kapil Kaul.
"The country cannot continue with our policy of liberalising for foreign carriers and restricting/constraining the Indian carriers," he said. "This does not happen anywhere and cannot be supported."
ET View: International Skies are the Limit
Warped policy must not prevent the newer domestic carriers from flying abroad. We do need to reform and liberalise the restrictive rule. Artificially hampering connectivity will be at a huge national cost. We are able to utilise only a small fraction of our bilateral code-share agreements. Foreign airlines provide the bulk of carriage. So, it is vital that more Indian carriers fly to international destinations. It will provide more choice for passengers, allow Indian carriers to better meet demand, and improve their bottom lines. Let their ambitions soar.
Read more at:
Flying high! PM Narendra Modi favours scrapping of 5/20 rule for Indian airlines - The Economic Times
@third eye @Chanakya's_Chant @Mike_Brando
