India’s Civil Aviation Minister, Ram Mohan Naidu, said this Tuesday that the Government is encouraging new airlines to operate in its airspace to eliminate any possibility of a duopoly, given the massive flight cancellations by the IndiGo company.
“We are encouraging more new airlines to start operating in India, ensuring fair access to airport capacity and eliminating any possibility of a duopoly, controlling connectivity and prices in our skies,” said Mohan Naidu in an intervention in the lower house of the Parliament of India (Lok Sabha).
The minister added that the entry of more airlines into India would mean “more options, more affordability and more resilience for passengers”.
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IndiGo controls more than 60% of the air market and, with Air India as its only significant competitor, has de facto dominated Indian aviation since 2006.
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The General Directorate of Civil Aviation ordered hours earlier the airline to immediately reduce 5% of its schedule to contain the operational collapse that has paralyzed air transport for more than a week. This Tuesday, the eighth day of disruptions, some 400 cancellations were reported at airports such as Ahmedabad, Chennai and Bangalore.
“We cannot undo the cancellations, I want to assure you that our entire team has been working very hard for you, our customers,” said IndiGo’s CEO, the Dutchman Pieter Elbers, this Tuesday, who assured that thousands of affected passengers have already received their refunds and will continue to do so in the coming days.
The crisis originated from a shortage of pilots, a consequence of the company’s inability to adapt to a rule that prevented the replacement of weekly rest periods with days of leave. The central government was forced to temporarily suspend the measure last Friday to contain the chaos.
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After collapsing yesterday on the Indian stock exchanges with falls exceeding 8%, InterGlobe Aviation Ltd, the parent company of IndiGo, recorded gains of more than 1.3% this Tuesday on the Bombay Stock Exchange and the National Stock Exchange of India.
In total, the airline has canceled more than a thousand flights in eight days, causing a sharp rise in fares on alternative services operated by other companies, which in some cases tripled the usual prices, leading New Delhi to demand that firms strictly comply with the established fare limits.
