Adani Wants An Airline? Naidu Faces Big Test

After the whole last year’s Indigo crisis and rising flight tickets, many questions were raised on bringing new airline companies into the market and the aviation minister Ram Mohan Naidu also mentioned about the same and put up the invite in the open to get more firms onboard for the same. And now it is reported that the Adani group has shown interest in starting an airline which also has raised an important question: Can a company that runs major airports also own an airline ? And in fact, major criticism is the monopoly that this can give rise to how similarly it is seen across the telecom sector.

The answer is not a simple no. There is no blanket rule in India stopping an airport operator from owning an airline. However, Adani faces a problem because of the rules in its agreements to operate airports like Mumbai and Delhi.

Adani Airports currently operates eight airports and has a major role in Mumbai airport. In June, the group reportedly approached the Airports Authority of India seeking permission or a waiver that could allow it to invest in or start an airline.

So, how can Adani actually start an airline?

One option is for the government to change the airport agreements and allow Adani to start an airline. Another is to keep the airport and airline businesses separate, with independent management and equal treatment for all airlines. The concern is that Adani could give its own airline an advantage at airports it operates. DGCA and AERA may have to ensure fair treatment. However, Adani Enterprises has denied plans to launch an airline.

For now, Aviation Minister Ram Mohan Naidu has said that no decision has been taken. The government is looking at the benefits of having more airlines while also examining the possible problems of an airport operator owning an airline.

This is a very challenging task for Naidu as he has been in a very severe criticism from all ends over his role as aviation minister and now if he gives a green signal for this and when Adani could become a monopoly resulting in a much bigger loss to the already declining aviation sector in India. Any wrong decision in this matter could become a major problem and in future, could be black mark on Ram Mohan Naidu and also on the TDP party.