Jan. 12: The state government has rolled back its policy of providing subsidies for unsold seats on flights operating from smaller airports - like those in Cooch Behar and Andal - after realising the inefficacy of such payouts to make a route viable.
"The experiment of doling out subsidies, in the form of viability gap funding, to make a route viable has failed," a government official said today. "Such a move will never have the desired outcome."
The official added the government could chip in with 20 per cent subsidy provided the Centre coughed up the rest. "There is no question of the state government alone subsidising flights from smaller airports."
Viability gap funding - an agreement between an airline and a government or an airport, wherein the carrier is paid for unsold seats on a particular route - didn't take off in at least two airports in Bengal, Andal and Cooch Behar.
The government had announced that it would pay subsidy for the Cooch Behar-Calcutta-Andal-Bagdogra route for a non-scheduled private airline (one that does not run regular flights).
The scheme was announced towards the end of 2015 but it never took off and was finally abandoned because of lack of passengers, sources said.
In Cooch Behar, the government had proposed to provide 50 per cent subsidy while the rest was to be borne by Bengal Aerotropolis Project Ltd (BAPL), the developer of the Andal airport.
"BAPL was asked to provide half the subsidy because the flight would operate via Andal. But the scheme was a non-starter," an official said.
BAPL, however, paid subsidy for empty seats on Air India's Calcutta-Andal-Delhi flight. The state government had waived the aviation turbine fuel surcharge of the aircraft flying on the route as an additional sop.
The national carrier, however, stopped operations in June last year citing non-viability and also because of alleged financial tiff with BAPL.
A senior official of BAPL said the airport was in talks with a private non-scheduled airline to start operations again. "There are some issues with the licence. As soon as they are resolved, the airline will start operations," he said.
The Airports Authority of India has given the airports in Balurghat and Malda to the state government on a 30-year lease.
"But no viable operator is showing interest in these smaller airports. Unless we get a formidable player, such as a scheduled airline, there is no point in providing subsidy for unsold seats," a state official said.
Aviation experts said an air route needed passengers round the year, not subsidies, to become viable.
"A steady passenger load is a dream in an industry-starved Bengal. Here, the average passenger count is not satisfactory even at Calcutta airport. Because of this no mainstream airline has shown interest in smaller airports like those in Andal and Cooch Behar," an industry watcher said.
"The scheduled airlines don't have the smaller aircraft to operate on these sectors. A flight from Andal or Cooch Behar can become viable with the existing passenger count only if the airline has 15-seater aircraft. But we don't have one," said Debjit Ghosh, regional sales head (east) of SpiceJet.
