Raju: For flights abroad, fly more to small towns

Speaking at the Express Group’s Idea Exchange programme, civil aviation minister P Ashok Gajapathi Raju said that the 5/20 rule is antiquated and without rationale, and needed to be scrapped.

However, it needs to be replaced with something and regional connectivity is the government’s priority.

Interestingly, Raju’s ministry has recently come out with draft guidelines mandating airlines to deploy on regional/remote routes the same capacity which they deploy on the 30 trunk routes. This has been opposed by all the carriers as it would increase their cost at a time when most of them are posting losses. Vistara has specifically said that newer airlines should be exempt from this rule.

Raju also said that the scrapping of the 5/20 rule would enable the country to utilise higher number of seats under the bilaterals.

The minister accepted that the industry is divided on the issue with the older players not wanting the government to change the rules because they feel that newer players can more easily access bank loans that can be used for rapid expansion. “I had an interaction with the airlines. Old players like it because it gives them a comfort level, what is bothering them that new airlines would have cleaner books and financial institutions may be more inclined to lend to new players. I think the government would look to promote more activity in India, not throw out the baby with the bath water,” Raju said. FE