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Claiming disparity, FIA threatens to curtail NE services

Sentinel Digital DeskBy : Sentinel Digital Desk

  |  3 March 2016 12:00 AM GMT

From a Correspondent

New Delhi, March 2: Accusing the Centre of disparity, the Federation of Indian Airlines (FIA) on Wednesday threatened to cut down its services in the landlocked Northeastern region.

"We have our objections to the tiol Civil Aviation Policy 2015. The views of all the stakeholders have not been taken into consideration while preparing the policy. We appeal to the government to reconsider it or else we will be forced to minimize our services in the Northeastern region," said Aditya Ghosh, president and whole time director of IndiGo.

Alleging disparity, the federation alleged that the government has given much more attention to the new airlines AirAsia India and Vistara - both operated by the Tatas through joint ventures with foreign partners.

"Removal of the so-called 5/20 Rule is equivalent to discrimition against the old players and would, in turn, favour the new players," said Ajay Singh, chairman & maging director of SpiceJet.

The 2005 guidelines specified five years in operation in domestic sector and minimum fleet size of 20 aircraft as the eligibility criteria. It was revised in 2009 which is applicable till date. However, the new criteria excluded all cargo service players, including AirAsia India and Vistara.

Members of FIA comprising Jet Airways, IndiGo, SpiceJet and GoAir have claimed that any review of the 5/20 Rule for domestic carriers wanting to fly abroad cannot be done in isolation and needs to be done in conjunction with another set of rules - the Route Dispersal Guidelines (RDG).

"The 5/20 Rule prescribes five years of domestic operations and a minimum of 20 aircraft as a prerequisite for a domestic airline to start flying on intertiol routes, some of which are considered to be more lucrative than domestic RDG routes. And now scrapping the 5/20 Rule without removing the RDG, which requires domestic carriers to operate a portion of their flights on economically unviable routes, would create an unfair playing field to the advantage of new players," said Wolfgang Prock-Schauer, chief executive officer of GoAir.

"The Draft NCAP (tiol Civil Aviation Policy) creates an unfair playing field by asking existing airlines to continue to maintain the same level of regiol and remote area deployment under the RDG, while allowing new entrants to build less encumbered and more cost-competitive networks as a result of the draft NCAP's proposals to remove/dilute the 5/20 Rule and prevent incumbents from redeploying capacity away from remote area routes (North-East, J&K, Andaman and Lakshadweep)," the FIA member said.

While IndiGo and SpiceJet run 300 and 70 flights per week in Northeastern states, the new airlines like Air Asia and Vistara run 10 and 13 flights respectively per week in the landlocked region.

"We have already taken up the matter with the concerned authority including the Aviation Ministry but did not get any response," said Ghosh.

The FIA has also alleged unwanted increase in ATF prices.

"In March 2016, FIA members have been informed of a 12 percent increase in prices without any explation. No response has been received from oil companies regarding this price revision and oil pricing continues to be non-transparent to the detriment of consumers and citizens. We understand that there was a change in the excise duty. However, when you take into effect the MOPAG decline, it is clear that the pricing needs to be revisited and made more transparent. We request that this irratiol price revision be reversed," said FIA associate director Ujjwal Dey in a memorandum to the Ministry of Petroleum & tural Gas.

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