AirAsia India gets licence to fly

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The directorate general of civil aviation (DGCA) on Wednesday granted flying licence to India’s newest airline, AirAsia India, after a long wait and legal hurdles. The licence is subject to the final outcome of cases in Delhi high court, opposing grant of the permit.

“We have granted air op­erator’s permit (flying lice­nce) to AirAsia India, sub­ject to the final decision of the high court and that is, under the directions of the Supreme Court,” DGCA chief Prabhat Kumar said.

AirAsia India is a joint venture among AirAsia, Tata Sons and Arun Bhatia’s Telestra Tradeplace.

“History has been made today in aviation. Everything has been hard for AirAsia but we never give up. Today AirAsia India has got approval,” tweeted Tony Fernandes, CEO of Malay­sian carrier AirAsia, the parent firm of the airline.

“Our CEO@MittuCh­an­­dilya is with the air operator’s permit. What a battle that was! Proud day for me and AirAsia stars,” Ferna­ndes said in another tweet.

Mittu Chandilya is the CEO of the Indian venture. Chandilya also tweeted: “Boom! 1815 hours (IST) today AirAsia India was born. So proud of my team, which is ready to revolutionise air travel in India.”

Top AirAsia India officials have promised to offer low and competitive airfares. Chennai will be the hub of the new carrier, which aims to focus on connecting non-metro towns and replicate the parent firm’s low-cost, no-frills model that has seen considerable success in Southeast Asia.

The startup carrier has just completed final inspections, including proving flights of its Airbus A-320, monitored by the DGCA. These test-flights went on for over 10 hours across five sectors as per the DGCA regulations.

Reacting to the development, BJP leader Subramanian Swamy, who is among the petitioners in the high court, ‘condemned’ the move and said it was done in “reckless disregard for the rules and regulations.”

In a statement, he said, “The matter was under the purview of the election commission as a violation of the model code and was before the Delhi high court on the directions of the Supreme Court. Therefore, the hurry of the government is inexplicable.” He said the “obscene hurry” to grant the licence before a new government came into being suggested corruption.

AirAsia India plans to have a 10-aircraft fleet within a year of starting operations and these planes would be drawn from the A-320 family of aircraft ordered by the AirAsia Group. On March 22, AirAsia India received its first A-320 aircraft configured in an all-economy layout with 180 seats.

The $30 million venture was the first airline to be launched after the FDI norms in aviation were amended in September 2012. While AirAsia owns 49 per cent stake in the Indian carrier, Tata Sons has 30 per cent and Telstra Tradeplace holds the remaining.

The final clearance by DGCA came after it disposed of about 20 objections from various parties, including the Federation of Indian Airlines, Subramanian Swamy and others. Most of them had argued that FDI by foreign airlines had been allowed into existing Indian arilines, not for creating joint venture startups. They had also claimed that the new airline would disrupt industry equilibrium.

The Foreign Investment Promotion Board (FIPB) had given its approval for AirAsia’s investment in April, following which the civil aviation ministry gave a ‘no-objection certificate’ in September 2013.

The airline has appointed a Tata Sons veteran S Ramadorai as its chairman. Other board members of the Mumbai-registered company are Fernandes, R Venkatraman, a former executive assistant to former Tata Sons chairman Ratan Tata, Bharat Vasani, chief legal counsel of the Tata group and Telstra’s Arun Bhatia.


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