Friday, 27 September 2013

AirAsia India Gets No Objection Certificate (NOC)

New Delhi: AirAsia India today announced it has received the crucial 'no-objection certificate' from the Civil Aviation Ministry, with the Malaysian parent company's chief Tony Fernandes terming the development as "very exciting".

Though the NOC was issued by the ministry last week, this was the first formal statement by the AirAsia group CEO on microblogging site Twitter.

“This is the fastest an NOC has been granted, and with this we will focus on obtaining the air operating permit,” said Mittu Chandilya, chief executive, AirAsia India.

 "I am thrilled to announce that AirAsia India has received NOC approval from the Government of India. Very exciting and hugely profitable," Mr. Fernandes said in a tweet.

With the NOC in hand, AirAsia India would now have to apply to the Directorate General of Civil Aviation (DGCA) for its Scheduled Operator's Permit (SOP, or the flying permit), which is the final step before it can start its flight operations.

The DGCA grants the SOP after vetting the preparations of a start-up airline to launch flights by examining issues such as availability of aircraft, manpower to operate flights, as well as ground preparations, such as aircraft parking space at airports and engineering facilities.

The NOC would also enable AirAsia India to import the first of the three aircraft to Chennai, which would be its headquarters.

AirAsia India, a joint venture between Malaysian airline AirAsia (which would own a 49 per cent stake), Tata Sons (30 per cent) and the Telstra Tradeplace owned by Arun Bhatia (21 per cent), plans to start operations within this financial year itself.

The start-up airline had been granted security clearances by the Union Home Ministry last month.

Currently, AirAsia operates in Thailand and Malaysia and connects Chennai, Bangalore, Tiruchirappalli, Kochi and Kolkata.

Tata Sons has recently announced that it plans to launch another airline in India with Singapore Airlines and have sent their own application to the FIPB for approval. Tatas would own a 51 per cent stake in this venture.

The low-cost carrier (LCC) has said it will operate from Chennai and focus on providing connectivity to tier II and III (smaller) cities.

In its proposal which got the nod from the Foreign Investment Promotion Board (FIPB) in April, AirAsia said it intended to hold 49 per cent stake in the joint venture (JV).

Tata Sons will hold a 30 per cent stake in the JV and Arun Bhatia-promoted Telestra Tradeplace 21 per cent. The initial investment approved for the airline stands at Rs809.8 million (Dh47 million).

The FIPB approval allowed the proposed budget passenger carrier to initiate the process for rolling out the seventh scheduled domestic carrier in Indian skies, after receiving regulatory clearance from the civil aviation ministry.

Currently, there are six scheduled domestic airlines in the country — Air India, Jet Airways, Jet Lite, SpiceJet, IndiGo and GoAir. The operating licence of Kingfisher Airlines was suspended last year.

The approval came after a change in the foreign capital investment rules in the Indian domestic aviation sector initiated by the government last year by allowing foreign airlines to invest up to 49 per cent in private domestic carriers.

The proposed AirAsia India would have a fleet of just three Airbus A320 aircraft and a staff of over 200 to start the operations.

Source :
Photo : Creative Commons / Andy Mitchell