Stiff Terms Set For Private Operators

The draft civil aviation policy has set stiff terms for private airline operations. Ownership of 20 per cent of the fleet has been made mandatory for schedule operators.

This will subsequently be raised to 50 per cent. Financial lease/purchase will also be considered as ownership for this purpose.

However, wet lease (in which the aircraft, crew and maintenance is provided by the lessor) will be permitted only for periods not exceeding three months.

To ensure that only financially sound companies enter the sector, minimum capital norms have been imposed. Thus, an airline must have a minimum capital base of Rs 10 crore if its fleet consists of aircraft below 40,000 Kg (50-seaters). The minimum capital requirement is Rs 30 crore for airlines operating aircraft above 40,000 Kg.

 

The minimum fleet size for scheduled operations has been pegged at five aircraft. This could be relaxed to three aircraft for remote areas.