3 southern airlines apply for regional licence

New Delhi: Three South-based airlines, the Chennai-based Air Dravida, the Kochi-based Emric Air and Star Aviation that plans to start flying in the southern and western regions have applied to the Government for a licence to launch regional airlines.

While Air Dravida plans to start services with Bombardier Regional Jet aircraft, Star Aviation is looking at utilising turbo-prop aircraft for operating flights, officials of the Ministry of Civil Aviation said.

“The Government would be writing to the airlines soon asking them to enhance their equity base as they do not meet the laid down norms,” a senior Government official said.

Guidelines

The regional airlines guidelines stipulate that those operating with three aircraft having take-off mass not exceeding 40,000 kg would need a paid-up capital of Rs 12 crore. The promoters would be required to pump in Rs 4 crore into the paid-up capital for each additional aircraft subject to a maximum of Rs 20 crore.

This provision is likely to give a push to the operation of smaller aircraft such as the Canadian Regional Jets, Embraers and the ATR, that carry between 80-90 passengers and can land on smaller airfields. With the Government providing incentives to smaller jets not only in terms of waiver of landing and parking charges but also aviation turbine fuel attracting a uniform sales tax of 4 per cent only throughout the country, it is generally felt that the operations of such airlines would meet with success.

Airlines operating with larger aircraft would also need to have a paid-up capital of Rs 30 crore. For every additional aircraft inducted they would be required to pump in Rs 10 crore into the paid-up capital, subject to a maximum of Rs 50 crore.

Four regions

The guidelines divide the country into four regions and describes regional airlines as a scheduled airline that operates primarily in a designated region. The guidelines specify one metro airport in each region except for South where Bangalore, Chennai and Hyderabad have been designated.

The airline, on the grounds of “operational and commercial exigencies”, may be allowed to operate from its designated region to airports in other region, except the metro airports of other regions. Technically this means that an airline can operate between Delhi and Coimbatore but would not be allowed to fly between Delhi and Mumbai.

The notification has identified 12 routes mainly between two metro cities on which regional airlines would not be allowed to operate.