Akasa Air founder and CEO Vinay Dube has backed a government proposal that would let airport operators own and operate their own airlines.
The civil aviation ministry is examining the change, which would relax the existing rule capping airport operators’ stakes in airlines at 10 per cent.
Dube said he supported the move, arguing the priority should be giving consumers greater choice in the aviation sector.
IndiGo co-founder Rahul Bhatia has opposed the proposal, describing it as a ‘massive conflict of interest’ since airport operators control the allocation of slots, parking bays and other infrastructure to airlines.
Bhatia, speaking during an investor call, said there was no global precedent for the model and argued it would ultimately harm consumer interests.
Adani Group, which operates Mumbai and seven other airports, and GMR Airports, which runs Delhi and four others, are seen as the most likely beneficiaries, though Adani has denied plans to enter the airline business.
Under existing rules, operators of major airports such as Delhi and Mumbai are capped at holding no more than a 10 per cent stake in any airline.
Adani Group, which operates Mumbai and seven other airports, and GMR Airports, which manages Delhi and four others, are seen as the most likely beneficiaries if the ownership cap is relaxed.
The proposal comes at a time when IndiGo and Air India together control nearly 90 per cent of India’s domestic aviation capacity, following a wave of consolidation in recent years.
Media reports of the proposal first emerged from discussions involving GMR and Adani groups seeking regulatory changes, prompting the current round of public debate among aviation industry executives.
The government has not yet indicated a timeline for finalising a decision on whether to relax the ownership cap for airport operators.
Any change to the current ownership cap would require legal clearance from the law ministry and approval from the Union Cabinet before it could take effect.
Photo by Krish Aarush, Wikimedia Commons, CC BY-SA 4.0
