Corporate Jul 2, 2013
With their application for the launch of a new low-cost airline pending before the civil aviation ministry, Ratan Tata and AirAsia Group chief Tony Fernandes today met minister Ajit Singh and briefed him about the latest appointments and other developments in the proposed airline.
"We came to apprise the minister about the developments that have taken place (since FIPB cleared their proposal) and our visit to Chennai (headquarters of the proposed airline)," Fernandes told reporters after a 30-minute meeting with Singh at his official residence in New Delhi.
Fernandes was accompanied by the new AirAsia India CEO Mittu Chandilya. Singh said the group has applied to the civil aviation ministry for a no-objection certificate (NOC) and given the names of all top new appointees for security clearance to the Union home ministry, as per the laid down regulations.
"They are working on that. When they get security clearance, they will apply to the DGCA (for flying permit). I don't expect that it will take too long," the minister said.
Over four months ago, the Foreign Investment Promotion Board (FIPB) cleared a proposal for the setting up of a new airline, AirAsia India, by Malaysian carrier AirAsia which has joined hands with the Tata Group and Arun Bhatia of Telestra TradePlace in a 49:30:21 joint venture partnership.
Replying to questions, Tata said, "This is a different type of enterprise which Fernandes is bringing. Hopefully, it will spread air travel across India and give a new dimension (to the aviation sector). The Tata Group is pleased to be associated with it."
Asked why the Tatas did not venture into the aviation sector earlier, he said, "We didn't come earlier because we chose to stay out."
Tata, Fernandes and Chandilya later also met commerce and industry minister Anand Sharma and briefed him about the progress made in their proposed airline venture.
To questions on high air fares in India, Fernandes said, "We think we will be able to reduce reduce fares by increasing volumes, creating an economic stimulus and creating more jobs."
He also replied in the affirmative when asked whether they would be able to bring down the fare levels in face of high cost of aviation turbine fuel (ATF).
On the growth plans of AirAsia India, Fernandes said while the headquarters of the airline would be based in Chennai, the operational bases could be at Chennai, Bangalore or Kochi.
"Almost 50 per cent of the air travel market is between Delhi and Mumbai. We will try to rebalance that so that India has a more equal distribution of air traffic," he said, adding, "We have a much better understanding of the market in the South."
Fernandes said he had "very good meeting" earlier with Tamil Nadu Chief Minister J Jayalalithaa, as also with the officials of the Airports Authority of India. The meeting with Singh came after the Civil Aviation Ministry sent the names of AirAsia India's Board members and other key officials to the Home Ministry for security clearance.
Once security clearance is granted, the Aviation Ministry would give the NOC to enable the airline apply to the Directorate General of Civil Aviation to get the Scheduled Operator's Permit (SOP) or the license to fly.
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