AirAsia India Now Raring to Fly

Friday, 27th September 2013 at 11:44am

Eight months after AirAsia Bhd. of Malaysia and Tata Sons Ltd. proposed a joint venture to form a new budget airline, AirAsia India, the offshoot of the partnership, is now cleared to take its wings

The low-cost airline has just received a green signal from Indian government late last week to start commercial operations. The granting of a no objection certificate (NOC) serves as a prerequisite to secure a license to operate from the Directorate General of Civil Aviation (DGCA), India's aviation regulator.

While it still has to secure a license to fly, the local subsidiary of Malaysia-based budget airline will have no problem getting its permit from the DGCA as the NOC is already a clear indication that it has passed industry regulations in the country.

With its NOC on hand, the airline is now allowed to start acquiring aircraft for use in its commercial operations. It is planning to launch its inaugural service before the year ends.

Despite the legal issues raised by a political leader in India, AirAsia India is nonetheless unperturbed as it is very confident that it has not violated any provisions in relation to aviation laws in the country.

The petitioner argued that the joint venture has not passed through proper and legal procedure as provided for in the country's newly-amended aviation laws regarding foreign ownership. It further claimed that the government has clearly transgressed with its decision to allow such venture.

AirAsia Bhd of Malaysia, the parent company, owns a 49% majority stake in the joint venture while the remainder, 51%, is shared between Tata Sons Ltd. and Telstra Tradeplace.

AirAsia is the largest and low-cost pioneer carrier in Asia based in Kuala Lumpur, Malaysia. Currently, it has four other local subsidiaries in as many countries including Indonesia AirAsia, Philippines AirAsia, Thai AirAsia and Japan AirAsia. AirAsia Japan, however, will soon cease to exist after the recent dissolution of the joint venture.

The entry of AirAsia India into the AirAsia family, the affiliate members will become four again. The most recent addition to the family is AirAsia Zest of the Philippines in the virtue of its affiliation to Philippines AirAsia after the latter bought a majority stake in the former Zest Airways.

AirAsia has a combined network of 88 destinations across Asia and a fleet of 141 aircraft.

By: Pete Lee.