Kerala decides to float own airline

First such venture in India to tackle Middle East passengers

Kochi: The Kerala government yesterday decided to go ahead with its plan of launching an airline floated by the state, the first such venture in India. The director board of the proposed Air Kerala airline met here, chaired by chief minister Oommen Chandy, who is also chairman of the airline board in his capacity as chief minister.

The announcement could not have come at a better time as hundreds of passengers to Gulf countries were left stranded in the state as the national carrier Air India decided to abruptly cancel six of its weekly flights to the Gulf sector. Reports indicate that the decision was taken to make those aircraft available for Haj flights to operate from Uttar Pradesh.

Briefing the details of the board meeting of the airline company, Chandy said Kerala would ask the federal government to waive two key conditions that are coming in the way of approval for Air Kerala, namely the need to have operated domestic services for five years, and a fleet of 20 aircraft. “When Air India Express began operations they had only two aircraft and we will request that the condition of having 20 aircraft be waived for us , too,” Chandy said.

Stating that the airline venture will be a people’s project, Chandy said people could invest with a minimum amount of Rs10,000 (Dh664) in shares, as against the minimum investment of Rs2,00,000 proposed earlier. The chief minister said a lower minimum investment level was kept in order to enable ordinary non-resident Keralites also to participate in the venture. Air Kerala is being established as a subsidiary of the Cochin International Airport Ltd, which was India’s first joint-sector airport project.

The first phase of the airline venture will involve an outlay of Rs 2 billion, and aircraft are expected to be leased for the project. The state government will have an equity of 26 per cent in the venture, and the remaining will be shared by individuals and institutions. The airline plans to begin operations with five aircraft, and the focus of its operations will be the Gulf sector.

Meanwhile, air travel industry expert K.V. Muraleedharan criticised Air India’s decision to pull out six weekly flights from Kerala till October 12. The move has put scores of passengers who had booked tickets months in advance in a quandary. He said chief minister Chandy also had to take responsibility for the situation, and that as an emergency measure, some larger-capacity aircraft available with the national carrier should be used to transport passengers who have been stranded in Kerala

http://gulfnews.com/news/world/india/kerala-decides-to-float-own-airline-1.1075107