Since 1991, Indian aviation carriers have built an exceptionally successful business across the Indian skies — backed by favourable policies in the form of foreign direct investments, an innovative low cost carrier (LCC) model, code-share/ alliance agreements, regional connectivity or the UDAAN scheme and the 5/20 rule to go international, to name a few. The introduction of the LCC model enabled every man to fly and nearly upset the operating model of full-service carriers (FSCs). No one could have imagined that LCCs would expand to such an extent that FSCs would be forced to run for cover under mounting losses.
The government now should lend a sympathetic ear and act fast to review some of the existing polices on a war footing to improve the health of the sector. Some of them include the 5/20 framework, the infrastructure related provisions, allowing exceptions under ATF rules and waive-off of certain concessions under the GST. Such measures may help stabilise both the FSC and LCC models and revive the industry.
Varun S D Bengaluru
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