Financial Daily from THE HINDU group of publications
Saturday, Feb 25, 2006
Financial Daily from THE HINDU group of publications Saturday, Feb 25, 2006 |
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Railway Budget Industry & Economy - Tourism Low-cost carriers see no impact — Travel sector hails move Tunia Cherian George
Mumbai , Feb. 24 The travel industry has welcomed the Railway Budget proposal to bring down fares on AC first and second class to make travel on the higher classes more competitive vis-a-vis travel by low-cost carriers. An official with India Tourism here said the Budget proposal was bound to draw the passenger with time to spare. Economy of travel was a key issue, and this was clear from the growth in air traffic following the arrival of the low-cost carriers. According to another official from the travel industry, the move would make short train journeys attractive to the air passenger. In cases where the time involved in travel was not an issue, rail travel would be preferred for its lower cost.
LCCs shrug away
However, the low-cost carriers (LCCs) say the measure is unlikely to have any impact on them. Mr Ajay Singh, Chief Operating Officer, SpiceJet, said the measure would not have any impact on LCCs because the difference in travel time still remained huge. "The proposal just goes to show that the Railways have been impacted by the arrival of LCCs. However, passengers are unlikely to shift from air to rail travel to save on a few hundred rupees," he said. Mr Jeh Wadia, Managing Director, Go Air, said the Budget proposals would not have any impact on it as his airline, which offered dynamic pricing and many seats that were still cheaper than AC rail fares. On the contrary, Mr Himmat Anand, Chief Operating Officer, SITA Inbound, said the Railways does not face any immediate threat from low-cost airlines, especially since domestic aviation was hampered by inadequate infrastructure.
More Stories on : Railway Budget | Tourism
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