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Air passengers may soon be asked to partially subsidise airlines that fly on routes with very low traffic, new routes and those with high tourism potential.
A panel set up by the Civil Aviation Ministry has proposed a cess of Rs 25-50 in its draft report, which will be put up for public comments in the first week of December.
The draft, accessed by Business Line , says, “Regional Air Connectivity Fund should be established to provide explicit subsidy to airlines to operate on routes with passenger load factor below 50 per cent, new routes and to 19 routes with high tourism potential.”
The proposed fund will provide explicit and direct subsidies to both national and regional operators. It may either be termed as Essential Air Services Fund (EASF) as envisioned by the Naresh Chandra Committee or Regional Air Connectivity Fund (RACF). For subsidy, the airline should be selected on the basis of competitive bidding.
The draft also suggests that the guidelines for route dispersal be reviewed every three years to reflect the needs of industry and the country.
Three route categories
At present, there are three categories of routes.
The first consists of 12 routes, including Delhi-Mumbai, Mumbai-Kolkata, Delhi-Chennai and Delhi-Hyderabad. The second includes flights to the North East, Jammu and Kashmir, Andaman and Nicobar and Lakshadweep. The other destinations are covered under category three, as well as an intra-category known as IIA.
Currently, if an airline operates 100 flights on 12 routes under category I, it needs to provide minimum of 10 flights in category II, one in category IIA and 50 in category III.
The draft proposes eight more routes in category I, such as Chennai-Pune, Bangalore-Pune, Delhi-Goa, Mumbai-Coimbatore, Mumbai-Cochin, Mumbai-Jaipur, Delhi-Ahmedabad and Delhi-Pune.
At present, over 49 per cent of domestic passenger traffic is in category I, 8.8 per cent in category II and 41.9 per cent in category III.
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