The government’s intentions on reforms in the aviation sector will be tested in the stand it finally takes on permitting the AirAsia-Tata joint venture to take off in Indian skies. The civil aviation ministry has to finally give the airline a licence to fly.
Union aviation minister Ajit Singh has been quoted earlier as saying that new licences would not be issued as there is a mismatch between demand and supply. This logic is skewed as the domestic airlines are still expanding.
It is a well-known fact that some powerful existing players had scuttled the attempt by the Tatas to set up an airline way back in 1995. Ratan Tata had proposed to set up a joint venture with Singapore International Airlines. He gave up in disgust after two years and only last year in an interview indicated there were hidden forces that worked against his getting an airline licence.
It is unfortunate that despite talk of reforms, many of them are derailed by crony capitalism and corruption, and not ideology. The aviation sector is an outstanding example, whether it is the case of Air India being assiduously crippled or new airlines being stillborn. Even Etihad Airlines, which is keen to take a stake in Jet Airways, has suddenly turned cautious and is worried about the government’s unstable policies. It is hoped that extraneous forces do not scuttle the chances of the JV of the Malaysian-based low-cost airline and the Tatas taking wing.