Capt GR Gopinath is back and has made a fresh start by relaunching Air Deccan. The airline recently received a licence from the regulator, under the UDAAN scheme for regional connectivity, to start scheduled commuter operator service. In an interview with BusinessLine, he shares his views on his comeback and how he expects to fulfil his dream of connecting the hinterland with his airline. Excerpts:

Looking back, do you have any regrets of all that happened in the past?

I should have perhaps not sold the airline. But then I was under immense pressure from the investors to sell. Being someone from the middle-class and having absolutely no background in running a large business, one does tend to take decisions based on the fact one needs to return the money one has taken. But I must tell you that at its peak and just before we sold it, Air Deccan had just then overtaken Jet Airways in the market share and we had a market share of 26 per cent.

You seem to be still extremely hopeful about the aviation sector in India...

I had a six-year non-compete clause with Vijay Mallya which got over a year ago. So, we decided that we should look at the sector again. Air Orissa contacted us and wanted to know if we can join with them to start operations. They are now our strategic partners. Less than 3 per cent of people travel by air. There are about 95 million tickets which get sold every year but there aren't 95 million people who fly. Out of this, only about 30 million people fly and the rest are repeat passengers from the same bucket. It means there is a huge headroom for growth. If you look at the DGCA figures, over 75 per cent of all the tickets sold is for flying to the six major cities — Mumbai, Chennai, Bengaluru, Delhi, Hyderabad and Kolkata. Rest of the 500-odd airports have no flights or get one flight once in three days. So, there is a huge hinterland which is unconnected. Look at it this way: Norway has a population of 4 million but the number of tickets sold is about 20 million while entire Europe has a population of about 250 million but the number of tickets sold is 700 million. It is my last hurrah. It was an unfulfilled dream and through this new venture, I hope to fulfil it.

Statistics are encouraging but ground realities might be quite different.

UDAAN is a transformative policy but the rest of the people are not aligned with it. We earlier had very inefficient and indifferent PSUs running the airports which have now been replaced with monopoly airports run by private sector monsters. Because they have a monopoly, the costs have become very high. I have asked for 25 per cent of the total number of flights, out of say Mumbai (which has 1,000 flights a day), to be allocated to regional airlines which is not unfair and is for equitable growth.

Your airline is back with the ₹1 ticket. How will it work this time?

As there are no taxes heaped on the ₹1 ticket as it is under the Government's UDAAN scheme of regional connectivity, the ticket price will remain at ₹1. In any airline, you will never get 100 per cent occupancy. On days when there is low occupancy, we offer some free tickets or the ₹1 fare we have come out with which stimulates the market. As per the UDAAN fares, we have to sell 50 per cent of the seats at ₹1,500 and longish flights at about ₹2,000. We are putting the Beechcraft aircraft, 1900D which is a 19-seater one. We will get about ₹3,800 as a subsidy for nine seats.

Why did you decide on the Beechcraft instead of ATRs?

The twin-engine Beechcraft are very popular if one has to fly to smaller towns. In certain towns, the runway cannot take a bigger ATR and another issue is that there are places where we won’t get a large number of passengers and then if we put an ATR, it will only be half full. So those passengers will end up paying for the unoccupied seats which will push up the fares. Also, if you bid with an ATR for a subsidy, the total amount of subsidy the government has to give you is high. We won most of the routes based on the fact that the subsidy outgo was lower compared with the others.

How many routes have you won and how many aircraft will you deploy?

We have won 84 out of 126 routes. The States we will be deploying our aircraft will be across Tamil Nadu, Maharashtra, Gujarat, Uttar Pradesh, Delhi, Uttarakhand and Punjab. In each State, we bid for a network. If you put an aircraft in one State, you will be able to cover the entire State. In the next six months, we will put 12 leased aircraft. You really don't need lots of investments if one were to start an airline like mine. The lease per aircraft works out to about $30,000 per month. Each aircraft will link five airports. We also enjoy a monopoly for the first three years. The Government felt that if too many airlines fly on the same routes, all of them will lose money and then most of them will withdraw which defeats the very purpose of having a regional connectivity policy.

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