Cabinet clears National Civil Aviation Policy

NEW DELHI,SOMESH JHA:In a landmark move, the Union government on Wednesday approved a plan to replace a decade-old rule for allowing new domestic airlines set up in India to fly on international routes.

Impressive show: Aircraft on display at the aviation show on Wednesday.

New airlines, such as Vistara and AirAsia, can now fly to international routes after operating at least 20 aircraft in the domestic market.

The new norms were a part of the National Civil Aviation Policy 2016 which was approved by the Union Cabinet here on Wednesday.

What is 5/20 rule?

According to the previous norm, also known as the ‘5/20 rule’, a domestic airline were allowed to go international only after completing five years of domestic flying and operate at least 20 aircraft.

According to the new rules, new airlines will need to deploy 20 aircraft or 20 per cent of the total fleet size, whichever is higher, on domestic routes in order to secure international flying rights.

The ‘5/20 rule’ was approved by the previous government in December 2004 when many decisions were taken to protect national carrier Air India. At that time, along with Air India, Indian Airlines, Jet Airways and defunct airline Air Sahara were allowed to fly on international routes. IndiGo, launched in 2006, had to wait till 2011 to begin operating on international routes and SpiceJet, which began operations in 2005, had to wait till 2010 to do so.

The gamechanger

Vistara, set up in January 2015, has 11 planes presently and plans to expand fleet to 20 planes by June 2018. AirAsia India, which began operations in June 2014, has been slow in its fleet expansion due to lack of clarity on the international flying norms and operates eight planes at present. Both the airlines may, however, review its fleet expansion plan after the new norms are set in.

Older airlines such as IndiGo, Jet Airways and SpiceJet that fly abroad have been opposing any proposal to relax the ‘5/20 rule’ and had also approached top government officials, including the Prime Minister’s Office, to lobby for the rule.

Posted by on June 15, 2016. Filed under Economy. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.