By Ruma Dubey

“In the airline industry in India it is sad to see the incumbent airlines lobbying for protection and preferential treatment for themselves against the new airlines which have been formed in full compliance with prevailing govt policy and providing air transport to Indian citizens in line with the dream of 'New India' promoted by the new government under Mr Narendra Modi's leadership.”

This is what Rata Tata said in his Twitter account. It is very rare that Ratan Tata puts out anything controversial in the public domain. And these strong words do come as a rude shock.

But why shock when it is easy to understand his frustration. The Tata’s have stakes in two airlines in India – AirAsia and Vistara. Both are currently not allowed to fly abroad.

All this brouhaha is over the 5/20 rule which in many ways does need to be shown the way. The other airlines, those who are eligible are naturally miffed with Tata’s words though he was diplomatic enough to not name any airline in particular. Go Air, SpiceJet, Indigo and Jet, they all have the mandate to fly abroad and they are opposed to any move to abolish the 5/20 rule.

This rule was made to protect Air India – that was the sole purpose of the rule. While on the other hand, there are others who say that rule was promulgated by ex-aviation minister of UPA raaj, Mr.Praful Patel. It is said that he brought in this 5/20 rule to protect Jet Airways and Kingfisher.

Whatever be the reason, what does this 5/20 mean? 5 in 5/20 stands for 5 years and 20 stands for at least 20 planes in the fleet. That is the condition set for domestic airlines to fly international – the company which wants to fly into and out of India, needs to have been in existence for at least 5 years and with a minimum fleet of 20 airplanes.

The thorn in the bush here – this 5/20 rule does not apply to foreign airlines. Anyone and everyone, with even no experience, as long as the company is phoren, can fly into and out of India. This bizarre rule explains why less than one-year old Etihad Airways of Abu Dhabi was allowed to provide services to India while older, registered ones like Vistara and AirAsia India are not able to do so. Dubai-based Emirates now carries more outbound passengers from India than any Indian airline. How pro-industry is this rule?

It is easy to understand why the other airlines are not in favour of opposing this rule as it means lesser competition. At the same time, the Federation of Indian Airlines (FIA) — a platform of IndiGo, Jet, SpiceJet and GoAir have also jointly opposed scrapping of this 5/20 rule for obvious reasons. They say that giving a free way to new entrants would remove the level playing field. Their grouse is also that removal will shift all advantage to foreign airlines controlled new entrants.

Cleary, in today’s flat world, such ‘protectionist’ attitude has to go. It is survival of the fittest. By putting in this 5/20 rule, the Indian aviation ministry has choked the life out of the existing airlines.  By allowing foreign airlines to fly into India and not allowing ours to fly abroad, it has deprived our own carriers of crucial growth and revenue generation opportunities. Removal of this rule would have also meant that financially strapped airlines could have refueled at cheaper rates abroad and helped improve the aircraft utilization.

A new draft civil aviation policy was penned few months ago and the civil aviation minister also supports removal of 5/20. The policy, instead of 5/20, has said that an airline can apply for an international flying permit to destinations which are of more than six hours duration after it accrued 300 domestic flying credits (DFCs). In the same way, a domestic carrier can fly on routes which are less than six hours, only after it has accumulated 600 DFCs. This, many say would be not only tough for new airlines but also for existing airlines to fulfill.

The bottomline here – the Govt has to get out of airline operations. And those seeking extension of protection need to know that – too bad they had to suffer through this rule but that does not mean others should also. As time and thinking evolves, progress will happen and rules will change. Yes, 5/20 should go.