Air India changes stand on 5/20 rule; says national interest should be criteria for government decision

NEW DELHI(PTI): In an apparent change of stance over the much-debated 5/20 norm, state-run Air India now is of the view that national interest should be the criteria for the Government when it decides on either retaining or scrapping the rule to allow Indian carriers to fly overseas.

The airline has submitted its new position on the 5/20 norm to the Civil Aviation Ministry, which has to take a final call on the issue before sending it to the Union Cabinet for approval, sources said.

Under the rule popularly called 5/20, a domestic carrier is allowed to fly abroad only after completing five years of domestic operations and having a minimum of 20 aircraft fleet. Air India’s latest stand on the issue has come under the new Chairman and Managing Director Ashwani Lohani. It had earlier taken the position, along with other airlines like Jet Airways, that status quo should be maintained on the matter.

It had opposed any tweaking of the norm on the ground that it would “sound death knell” for the national carrier.

“The sudden withdrawal of the protection of 5/20 rule, might be the proverbial last nail in the national carrier’s coffin without bringing any significant benefit to the nation…In this background, Air India would recommend that the Government while rationalising the 5/20 rule may adopt a pragmatic, simple but cautious policy, based on a dual criteria of safety and extent of domestic operations,” former Air India CMD Rohit Nandan had written to the Ministry in January last year.

Significantly, two start-up carriers – AirAsia India and Vistara, which have investments from Tata group, are lobbying for removal of 5/20 rule and allowing them to fly abroad even as established players under their umbrella organisation , Federation of Indian Airlines (FIA) have opposed any change.

FIA comprises four domestic airlines–Jet Airways, IndiGo, SpiceJet and GoAir.

Posted by on January 18, 2016. Filed under Economy. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.