In a decisive move to foster greater competition and choice for passengers, the Indian aviation ministry has accelerated its efforts to welcome new players into the country's fast-growing skies. This push comes in the wake of recent operational disruptions that highlighted the risks of a concentrated market.
Ministry Grants NOCs to Three Aspiring Carriers
The ministry has taken concrete steps this week by issuing crucial No Objection Certificates (NOCs) to two proposed airlines. This follows a similar clearance granted earlier. Union Aviation Minister Ram Mohan Naidu confirmed on platform X (formerly Twitter) on Tuesday that he recently met with teams from three aspiring airlines: Shankh Air, Al Hind Air, and FlyExpress.
He stated that while Shankh Air had already received its NOC from the ministry, both Al Hind Air and FlyExpress were granted their certificates this week. The minister emphasized that encouraging more airlines has been a key endeavor for the ministry, especially in one of the world's fastest-growing aviation markets, a growth he attributed to the policies of the Modi government.
Building on Regional Connectivity Success
Minister Naidu pointed to existing government schemes like UDAN (Ude Desh ka Aam Naagrik) as a foundation for this expansion. He noted that these initiatives have enabled smaller carriers such as Star Air, India One Air, and Fly91 to play a significant role in enhancing regional connectivity across the nation. The ministry believes there is substantial scope for further growth, with new airlines poised to tap into unmet demand and underserved routes.
Industry Calls for Cost Rationalization
While the entry of new airlines is welcomed, industry veterans caution that the fundamental challenges plaguing Indian aviation remain. A seasoned industry expert highlighted a persistent paradox: In the Indian aviation ecosystem, almost all stakeholders make money except the airlines themselves. This unsustainable dynamic has led to regular airline collapses over the past three decades.
The expert identified high operating costs as the core issue, citing factors like elevated jet fuel prices, taxes, limited management bandwidth, and thin funding. India continues to have among the highest operating costs for airlines globally, creating a cost-hostile environment that makes survival difficult even for well-intentioned new entrants.
A senior airline official echoed this concern, stressing that air travel is no longer a luxury. For flying to remain within the reach of the common man, as envisioned by government schemes, a rationalization of costs and taxes is mandatory. The industry is urging the government to closely examine these structural issues to ensure the long-term health and stability of the sector, even as new competition is introduced.
