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Business News/ Politics / Policy/  New aviation policy to be implemented from April

New aviation policy to be implemented from April

Civil aviation secretary Rajiv Nayan Choubey says he expects the aviation policy to be cleared by the cabinet by the end of this month

The aviation ministry is expected to take decisions on the controversial 5/20 rule in the policy. Photo: Abhijit Bhatlekar/MintPremium
The aviation ministry is expected to take decisions on the controversial 5/20 rule in the policy. Photo: Abhijit Bhatlekar/Mint

New Delhi: The civil aviation ministry expects to implement the aviation policy by the beginning of the next fiscal year, after the cabinet approves it at the end of the month.

Union civil aviation secretary Rajiv Nayan Choubey said he expects the much-delayed aviation policy to be cleared by the cabinet by the end of the month

“The implementation will begin from 1 April," he said, adding, “We wish it takes less time but it is largely because of the comments received by diverse stakeholders (in response to the draft document)."

The aviation policy was first presented in November 2014 and then revised in October 2015 and put up for public comments.

It has seen strong reactions and lobbying from older airlines like IndiGo (InterGlobe Aviation Ltd), Jet Airways (India) Ltd, SpiceJet Ltd, GoAir and new entrants like Vistara and AirAsia. The latter want a relaxation in the policy, allowing them to fly abroad, while the older airlines say this should not be allowed.

The aviation ministry is expected to take decisions on the controversial 5/20 rule in the policy. The rule says an airline needs to fly five years in the domestic market and have a fleet of 20 aircraft before it can fly abroad. Choubey said that there would be a level playing field for all airlines and the government will see to it that no wrong is done to anyone.

The ministry says it is working on what the rule will be replaced with.

The draft policy also proposes to provide viability gap funding for airlines for regional connectivity, various tax sops and setting up of no-frills airports.

Additionally, the policy proposes a cap on airfares at 2,500 for flights of one-hour duration under the regional connectivity scheme for places that are not served currently, as well as the auctioning of international flying rights, among other things.

Currently, such rights are granted on a reciprocal basis between two countries.

Choubey also said the policy will push regional connectivity, a thrust area for Prime Minister Narendra Modi.

The ministry, together with the heads of state-owned carrier Air India and the Directorate General of Civil Aviation, briefed the media on Wednesday on the benefits to the aviation sector from the 2016-17 budget.

Aviation minister Ashok Gajapathi Raju said there was also a proposal under consideration to rename airports in the country after the city they are based in. Terminals can be named after famous local or national personalities.

If cleared, Delhi’s Indira Gandhi International Airport could be called Delhi International Airport and a terminal could retain the name of Indira Gandhi, he said. There are two terminals at the Delhi airport.

Raju also said a second airport for Delhi will be required in 2022 as that’s when the existing airport will reach its peak traffic level. The government is bound by an agreement with GMR Infrastructure Ltd, the developer of the Delhi airport, that states that a second airport can come up only when the existing one reaches a certain traffic threshold.

Minister of state for aviation Mahesh Sharma added that as it would take five years to complete a new airport, the process should start soon.

A proposal to develop an airport at Jewar, near Greater Noida in Uttar Pradesh, has been pending for many years. The ministers did not answer a question on whether an announcement is likely ahead of the Uttar Pradesh elections, due next year.

Choubey said the sops announced in the budget for aircraft maintenance, repair and overhaul (MRO) would win back a lot of business that was going to other countries. The business is worth 5,000-6,000 crore.

“India is a tech hub. There is no reason why India should not be an MRO hub for Asia," he said.

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Published: 02 Mar 2016, 03:33 PM IST
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