New Delhi: The battle royale between the Tatas and the grouping of four airlines —IndiGo, SpiceJet, Jet Airways and GoAir — over whether the 5/20 rule should be abolished or not continued on Wednesday.
The Tata Group argued for the abolition of the rule saying that “the 5/20 rule has thus far principally benefited only foreign airlines, who have captured 70 per cent of the international traffic with India, taking Indian jobs and revenue with them”.
The Tatas said that the impact of the entry of new airlines like Air Asia India and Vistara (in which the Tatas have a stake) is already being seen “in the superior customer service and on-time performance of these carriers and added that the claim (made by their opponents) that air fares in India will go up as a result of removing the 5/20 rule is “specious and unfounded”.
The grouping of the four carriers is the Federation of Indian Airlines (FIA) which is strongly opposed to any move to abolish the 5/20 rule.
The FIA hit back at the Tata Group and criticised the stand taken by the two Tata group-invested airlines — Vistara and AirAsia India — for removal of the 5/20 norm, saying it was in the “self-interest and not in “national interest” of the two carriers.
The 5/20 rule is that a domestic scheduled carrier should have completed at least five years of domestic operations and should have at least 20 aircraft in its fleet to be able to fly abroad.
AirAsia India and Vistara are currently ineligible to operate overseas under the 5/20 norm.
In its statement, Tata Sons said, “The claim that air fares in India will go up as a result of removing the 5/20 rule is specious and unfounded. Not protectionism, but increased competition within the country will further contribute to lower prices and greater accessibility of air travel to common people.”
The FIA swiftly hit back, and was quoted by news agencies, as saying, “They (Vistara and AirAsia) claim to be ‘Indian’ airlines and so it is puzzling that they now do not wish to serve the Indian civil aviation growth story be a part of India’s future growth.”
