AirAsia India wants foreign flying clarity before expansion

Fleet expansion depends on way forward on the 5/20 rule which governs flying abroad, evolving competition and solving infra issues plaguing the airports, says Mittu Chandilya

Low-cost carrier Air Asia India has decided to go slow with its fleet expansion due to lack of clarity on international flying rules. It has also deferred its one-plane-per-month fleet expansion plan, and plans to end the year with 7-10 planes from the present five.

"We slowed down in adding one plane a month plan. I took the call of watching and waiting," airline's chief executive Mittu Chandilya told PTI, and blamed the decision to the lack of clarity on overseas flying rights for new airlines.

"Now we have five planes. ... By December, we should end up anywhere between seven and 10 planes," he said, adding the number of routes it operates will grow to 15 from the present nine.

Chandilya, the youngest chief executive in the domestic aviation industry, said the fleet expansion depends on the way forward on the 5/20 rule (five years of domestic operations and 20 planes) which governs flying abroad, evolving competition and solving the infrastructure issues plaguing the airports.

"Ideally, they should abolish the 5/20 rule. Realistically, it will be a variation where the point system (bonus scores for flying into the Northeast and other under-served markets that the government recently proposed) that they keep talking about will come out.

"I am very optimistic that things will change where open skies and free competition will all be something that will come up," he said, when asked about his expectations on the way forward with the 5/20 rule.

The new government has not been successful in pushing ahead with plan to relax 5/20 rule despite the fact that this was one of the initial reforms mooted by the Civil Aviation Minister Ashok Gajapati Raju.

The airline has clearly identified the overseas routes where it wants to fly, but the policies are a big deterrent, Chandilya added.

In January, the no-frills carrier had announced that it would add one plane per month from March onwards, which would have taken its fleet strength to around 14. However, its fleet has grown by only one plane to five now.