Air India plans to extend low-cost service

Air India is considering a proposal to extend its low fare services to some domestic routes to compete with private carriers.

"In order to compete effectively with other domestic low fare carriers, and to get a share of the low fare market segment, Air India is considering a proposal to extend low fare services to some of the domestic routes also," Civil Aviation Minister Praful Patel informed Lok Sabha in reply to a question.

He, however, said Air India would continue to be a full service carrier in the domestic market.

Patel said Air India's subsidiary Air India Express operates low fare services on short haul international routes covering Gulf and South-East Asian countries.

"However, no change is under consideration regarding Air India's international services," he said.

In reply to another question, the minister said, to check the trend of many airlines giving misleading advertisements regarding fares, the aircraft rules have been amended wherein airlines shall display tariff in a united manner to show the total amount payable by a passenger as also a break-up of the total amount, indicating the fare, tax, fees or other charges, if any, separately.

"All scheduled domestic airlines except GoAir have complied with the requirement with regard to display of total airfares payable on their respective websites. Since the website of GoAir is being maintained by an outside agency, they have sought time for necessary amendment," Patel said.

The civil aviation minister said notice has been served on Kingfisher Airlines to reduce its airport dues to the Airports Authority of India within the level of security deposit failing which their operations would be put on "cash and carry basis".

On the ground handling policy, Patel said the government has decided to implement a new ground handling policy at airports keeping in view the security requirements and balancing them with the requirement of providing ground handling services of international standards in a competitive environment.

"However, the Airline operators had expressed their concerns about the new ground handling policy. The matter was examined by the government and it was decided that the exit of non-entitled entities including domestic airlines will be implemented only after undertaking a comprehensive review and with inter-ministerial consultations in a time-bound manner," he said.

Patel also said the government has proposed to formulate a new civil aviation policy. "However, most of the issues set forth in the proposed National Civil Aviation Policy have already been implemented," he said.