Capacity, fare regulations by India slowing passenger growth: IATA DG Walsh

By ET News

Restrictions in terms of limiting capacity and fares by the Indian government has slowed the return of domestic market in India, which is the only big domestic market that is lagging, DG of the airline body International Air Transport Association (IATA) Willie Walsh told reporters.

“Among the big domestic market, India is the only one that is lagging… The recovery is significantly impacted due to the regulation that has been put in place. It surprises me… India has been the fastest growing domestic market largely due to measures taken (in terms of relaxation of regulations). I would hope that we will see a change in approach… Regulations restricts competition, market access and growth,” IATA DG Willie Walsh told reporters.

He added it is not fair to impact aviation growth just to protect weaker airlines. “Is it fair that Indian people or the economy suffers to protect some potentially weaker airlines? Instead there are ways like providing financial support to airlines proportionately. Other measures could have been taken instead of this measure that has impacted connectivity in the country,” Walsh added.

Since the time Indian aviation market opened post-COVID in May last year, the government has been regulating the capacity airlines can operate as well as fares that they can charge. India’s largest carrier IndiGo, recently, also had said that the government should relax these norms. The government, however, feels that these restrictions are required to protect financially weaker airlines.

On the issue of European Union not exempting passengers, who have been vaccinated with India-made Covishield (India name for Astra Zeneca vaccine), Walsh termed it unfortunate.

“They key is the World Health Organisation (WHO), which is a world body and an expert in the area, and countries should follows norms prescribed it. If the countries start to do it, it becomes more political and less medical. It is in nobody’s interest to do that (create confusion over which vaccine to allow and which to not),” Walsh added.

While Covishield was not allowed, Astra Zeneca was allowed by the EU. As India protested, several countries in Europe allowed Covishield. The EU has still not allowed it.

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