New Delhi, March 29(Inditop.com) Low-cost carriers SpiceJet and IndiGo will have to assure the government of their financial capability and operational preparedness to get the nod to fly abroad, a civil aviation ministry official said Monday.
“The government cannot freely offer licenses to any airlines which wishes to fly abroad. We have to look into other aspects like the financial viability of the airline as well so that it can sustain international operations even when the demand is low,” said the official, who asked not to be named.
“This is being done given the experience we had in the past when domestic airlines like Air India, Kingfisher Airlines and Jet Airways had either discontinued many flights to international destinations or rationalised their services following the global meltdown. This is something serious which the government cannot ignore,” he added.
According to the official, the norms for issuing licenses for overseas operations has been made stricter.
The ministry has asked aviation regulator, Directorate General of Civil Aviation (DGCA), to conduct a check of the airlines’ preparedness to fly abroad.
Airlines which seek to fly abroad need to have at least five years of domestic operations and a fleet of at least 20 aircraft. While IndiGo Airlines has 25 aicraft and expects few more deliveries this year, SpiceJet has 19 aircraft and will take 9 more deliveries this year.
SpiceJet meets the stipulated five years of domestic operations in May this year. For Indigo, it is August next year.
Both the carriers are willing to fly to SAARC and ASEAN countries unlike Air India, Kingfisher Airlines and Jet Airways which fly to the U.S., Europe and a few south Asian and east Asian countries.
IndiGo and SpiceJet have an edge over Air India, Jet Airways and Kingfisher Airlines which have incurred losses over the past few years. The two carriers have been able to generate some operating profit.
The market share of IndiGo Airlines and SpiceJet were 13.9 percent and 12.4 percent respectively in 2009.
