Civil aviation policy: Fleet size may be linked to paid-up equity

New Delhi: The draft civil aviation policy proposes to link aircraft acquisition by airlines to their paid-up capital.
Airlines operating large aircraft — 40,000 kg in payload and more — must increase their paid-up equity by Rs 20 crore for every five planes added to their fleet. Those operating small aircraft need to increase it by Rs 10 crore. Thus far, the key requirement has been that an airline flying large aircraft must start with at least five planes and a minimum of Rs 30 crore as equity. Those flying small ones can make do with Rs 10 crore. The draft policy says the capital requirement should be raised to Rs 50 crore for the first category and Rs 20 crore for the second. This is proposed to apply with retrospective effect.
They said airlines not conforming to these conditions would not be allowed to expand their fleet. The civil aviation ministry plans to present the civil aviation policy for the Cabinet’s approval this month.
10/06/06 Surajeet Dasgupta & Bipin Chandran/Business Standard

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