Up In The Air: Scrapping of Aviation 5/20 Rule Under A Cloud

Up In The Air: Scrapping of Aviation 5/20 Rule Under A Cloud

Many media news agencies and channels reported that the Union government was in the process of scrapping the 5/20 aviation rule. But this has drawn strong objections from Indian aviation players. According to the 5/20 rule, amy aircraft carrier must be at least 5 years old and possess a fleet of a minimum of 20 aircrafts before being allowed to fly abroad.

While the UPA II government had started the process of scrapping the rule, the aviation ministry is currently exploring this option by calling a meeting of Indian aviation players. Media reports have indicated that during the meeting, 4 Indian airlines, Air India, Jet, SpiceJet and IndiGo put their foot down and refused to agree to the scrapping of the rule. Seeking the scrapping of this rule, the latest TATA-Malayisian Airlines low cost venture was in favour of the move.

Media reports indicate this is the last move made by the civil aviation ministry before the commencement of elections later this week. The FIA or Federation of Indian Airlines has also protested vociferously against the scrapping of the 5/20 rule. It has written to Civil Aviation secretary Ashok Lavasa saying that “Considering that all airlines in the process of fulfilling their obligation have incurred substantial losses through domestic operations, it would be unacceptable for the government to now consider revising the policy by the removal of the 5/20 rule in order to benefit the international airlines' joint ventures, which are under consideration and approval."

At present, all Indian airlines meet the requirements to fly to international routes except Go Air. However, GoAir too is planning to add another 2 planes to its current fleet of 18 mid year to commence flights on international routes. However, the clear beneficiary of the abolishing of this rule would have been TATA Singapore Airline as well as Air Asia. The policy change was expected to enable structure for the future of the industry, according to sources quoted by media reports.

AirAsia CEO Tony Fernandes was quoted by the media as saying "India is strategically located. And we can operate flights from the southern part of the country, within a four-hour circle, to destinations in Africa and on the Gulf routes like Doha, Nairobi, Maldives, Karachi, Bangladesh and some Chinese cities. It is bizarre that the government has a regulation in place that allows airlines with five years of operations and a fleet of 20 aircraft to fly international."

New and old carriers are now at loggerheads over the scrapping of the 5/20 aviation rule. The abolishment of this rule has yet to take off, even though successive governments seem to be in favour of it. But the fact remains that any policy change from the current scenario is likely to yield an equal share of bouquets and brickbats from the players divided over the issue. On the question of rationalisation of taxes on jet fuel, airline carriers showed no such division of opinion in demanding that ATF (aviation turbine fuel) must be put in declared goods category for uniform low tax rates across the nation.