The Hindu Business Line : Concept of regional airline takes wings

The first regional airline could take to the skies soon with the Ministry of Civil Aviation holding a meeting with representatives of Air Dravida, TransIndia and MDLR Air here recently.

Sources told Business Line that at the meeting the airlines made presentation relating to their equity structure and also their business plans. The promoters of Air Dravida informed the meeting that they planned to increase their share holding to have a paid-up capital Rs 30-40 crore by the time the airline is ready to launch operations.

The meeting was also informed that the airline proposed to increase the paid-up capital to about Rs 110 crore through private equity funding. Air Dravida plans to have a market share of 15 per cent in the first five years of operations. It proposes to fly in Tamil Nadu, Andhra Pradesh, Karnataka and Kerala starting operations with three 50-seater Bombardier CRJ-200 aircraft and scaling up to a fleet of 10 aircraft by the third year of operations.

Seeking licence

The Delhi-based MDLR, which has a paid-up capital of Rs 50 crore, sought to convert its existing non-schedule operators’ permit into a regional airline licence. The promoters told the meeting that they should be given the regional airline licence, as the airline met both the minimum equity and fleet strength norms.

The airline currently operates on various routes, including connecting Delhi with Kolkata. It plans to restrict its operations to within north India after the grant of a regional airline licence. The airline plans to operate from Delhi to nine north Indian cities, including Dehradun, Pathankot, Kullu and Dharamshala.

How it works

The possibility of connecting more cities in south India with air services was highlighted by the representatives of TransIndia, sources said.

The concept of regional airlines, announced by the Ministry of Civil Aviation in August this year, allows an airline to operate from any airport in the four designated regions to any airport in the country.

Most of them would, however, be prohibited from operating flights to a metro airport outside their region. The exception to the rule is in South India, where a regional airline would be allowed to operate among the three existing metro cities of Hyderabad, Chennai and Bangalore.

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