The Hindu Business Line : DGCA notifies guidelines for regional airlines

Snapshot
The guidelines specify one metro airport in each region except for south where Bangalore, Chennai and Hyderabad have been designated.
Airlines operating with three aircraft having take-off mass not exceeding 40,000 kg would need a paid-up capital of Rs 12 crore.

Our Bureau

New Delhi, Aug 23

The Directorate General of Civil Aviation (DGCA) on Thursday notified the minimum requirements for grant of permit to operate scheduled regional air transport services.

For regional airlines, which have been described as a scheduled airline that operates primarily in a designated region, the country has been divided into four regions. The guidelines specify one metro airport in each region except for south where Bangalore, Chennai and Hyderabad have been designated.

The airline, on 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 on which regional airlines would not be allowed to operate. The only exception appears to be Mumbai-Thiruvananthapuram which, going by laid down guidelines, a regional airline should have been given permission to operate.

The guidelines stipulate that airlines 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.

“The guidelines are a natural progression in the sector. With consolidation taking place at the national level and many of the national players concentrating on international routes, it was only natural that the regional players would come up,” said, Mr Harsh Vardhan, former Chief of the feeder airline, Vayudoot.

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