Indian aviation sector in critical phase: IATA

The situation in Indian aviation sector was critical and there is an urgent need to address the problems, the head of an international carriers' trade group said here Thursday.

Addressing India Aviation 2012 here, Tony Tyler, the director general and chief executive of the International Air Transport Association (IATA),  said the problems the Indian aviation sector facing were severe and beyond the control of airlines and solving them will require a government-wide team effort.

He called for evolving a four-pillar strategy to rebuild competitiveness and assured the support for developing such a policy.

"The situation in India today is critical and we must move forward urgently and through IATA, I can certainly pledge the resources of the industry to support the development of such a policy with the greatest amount of determination and speed," he said.

He asserted that the agenda to rebuild competitiveness in Indian aviation rests  on four pillars of taxes, infrastructure, costs and investment policies.

Tyler said the ministry of civil aviation can and has taken steps in the right direction. "But without the support of the  ministries of tourism, finance,  environment and petroleum and the Competition Commission, the major changes that are needed cannot take place," he added.

Many committees and groups of government officials have looked at remedies in the past and another committee is not the answer, he said and suggested that a common vision expressed in the National Aviation Policy and strongly linked to an implementation plan could be a way forward.

While referring foreign direct investment for Indian Airlines, he said foreign airlines could own up to 49 percent of an Indian domestic carrier if the aviation ministry proposed to lift restrictions.

Tyler said the ministry's proposals to lift restrictions would allow strategic tie-ups with foreign airlines cemented by an equity stake.

Such equity partnerships have strengthened airlines such as Lufthansa-SWISS-Austrian-Brussels Airlines, Air France-KLM-Alitalia, LAN-TaM and British Airways-Iberia.