Bird Group - 1

Regional airlines look for a slice of the sky
14 Aug, 2007, 0311 hrs IST,Cuckoo Paul & Sudipto Dey, TNN

THE ECONOTMIC TIMES

MUMBAI/NEW DELHI: The rush for ‘regionals’ or commuter airlines has begun. A string of new carriers is awaiting specific details on fiscal benefits, before they begin providing small and medium-haul air services connecting smaller communities with larger cities and hub airports. The Bird group, a Delhi-based travel and IT firm which markets travel booking software Amadeus in India, could be among the first to take off in North India, after the new policy was announced by the minister for civil aviation Praful Patel last Thursday. Four unnamed South Indian airlines are also waiting in the wings for takeoff. In all, at least half a dozen start-ups including Premier Airways’ airline brand Easy Air and Air Dravida in the south, Mega Airlines from the North-East and North Star in the west are planning to seek licence under the new category. Most are awaiting details on the fiscal benefits for regional airlines, say industry experts. “The new policy is very encouraging and we are convinced about the huge scope there could be in connecting traffic from buzzing non-metro cities like Ludhiana and Chandigarh to the capital,” says Bird group executive director Ankur Bhatia. Bird group is planning to create its hub in Delhi. The group is currently evaluating aircraft for the operations. But the actual airline launch will eventually depend on when the second runway comes up at the Delhi airport, so that the existing congestion over Delhi airport does not upset the economics of operations, he added. Incidentally, the company already has a permit to operate a non-scheduled airline. The Union civil aviation minister last week announced the policy that creates a new category of airlines which will operate primarily between airports of any of the four regions classified as North, South, West and East/North-East. The policy, announced with much fanfare, does not offer any sops to the carriers for the moment. Incentives like exemption from navigation and airport charges and a lower 4% sales tax on ATF are available to both regional as well as pan-India carriers, as long as the weight of the aircraft is below 40,000 kg. After a few years of operation as a regional airline, the carrier can apply for a second permit for pan-India operations. The ministry has stopped clearing applications for airline operators because of the over-capacity situation in the Indian skies.