The Telegraph
Since 1st March, 1999
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Aviation policy to be competitive

New Delhi, Oct. 15: Civil aviation minister Rajiv Pratap Rudy today said the government is working on an open bilateral policy as the country cannot afford to protect state-run firms at the cost of the economy.

“We are going to work on a comprehensive open bilateral policy as competition is the key word,” said Rudy. “Every reform process witnesses resistance by monopolies of the government, but we have to think of our economy.”

The minister hinted that the bilateral arrangements would be “protective” towards state-owned airlines in order to safeguard their dwindling revenues from competition.

“We have a restrictive, protective bilateral policy,” he told reporters on the sidelines of a two-day European Union-India Civil Aviation Safety and Security Conference that opened here.

Rudy admitted that state-run airlines — Indian Airlines (IA) and Air-India (A-I) — had expressed reservations over Prime Minister Atal Bihari Vajpayee’s open sky invitation to the 10 member countries of the Association of South-East Asian Nations (Asean).

Both IA and A-I fear a plunge in revenues and increased competition after the Asean carriers start operating to the comparatively smaller but important tourist destinations in India.

A-I was particularly concerned over Vajpayee’s announcement that no bilateral arrangement was needed, since the airline earns revenue through these commercial arrangements.

The minister was also apprehensive. “Like WTO, it is highly desirable, but it needs a lot of time. Everyone wants it, but we have to see at what cost. Will the countries feel safe, will our resources be protected'” he commented.

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