India Must Clip Indigo's Wings To Protect Fast-Growing Domestic Aviation Market

(MENAFN- The Arabian Post) By Nantoo Banerjee

India's domestic civil aviation market, the world's third largest after the United States and China, nearly collapsed last week as its major private airline, IndiGo, boasting nearly 70 percent of traffic share, suddenly cancelled hundreds of flights on the ground of pilot shortages after it failed to adapt to new flight crew rostering rules, leaving thousands of passengers stranded in the airports across the country. If the airline is to be trusted, its operations will return to full normalcy only by the second week of next month. The airline has sought temporary relief on the new rules that call for more rest hours and restricted night-duty for pilots. Clearly, IndiGo's action was unacceptable. The government must relax cabotage rules to allow chosen foreign airlines to undertake domestic operations in India without delay. Cabotage rules restrict domestic transport within a country to its own flagged carriers. This is the country's peak domestic flying season for both local fliers and foreign tourists coming to India.

It is time that the government should relax cabotage rules to allow chosen foreign airlines to undertake domestic operations in India without delay. Also, the government must ensure that no domestic airline exceeds 30 percent passenger share of the market. According to reports, IndiGo has been manipulating the market and the government, the civil aviation regulator DGCA, for years to create a near operational monopoly situation through various questionable means. It allegedly constrained domestic rivals over the years by leveraging its so-called ultra-low-cost model, single aircraft type from the Airbus a320 family, and placement of massive aircraft acquisition orders, squeezing its competitors financially and operationally and forcing rivals like SpiceJet and Jet Airways to submission. It flexed its financial muscle to outlast weaker players, creating near-monopoly situations in high-traffic markets. IndiGo went to invest heavily in new aircraft (like a 500-plane Airbus order in 2023) and absorb shocks, while rivals struggled with debt and funding. It dominated the skies with scale, efficiency, and deep pockets, effectively limiting its rivals' ability to acquire new aircraft and grow, creating an environment where it became the dominant, almost monopolistic, player in India's domestic aviation, all under the government's nose.

Surprisingly, the DGCA helplessly watched and continuously bent before IndiGo's pressure tactics. It would appear that the civil aviation authority had been playing in the hands of IndiGo, yielding to pressure from the dominant airline by granting temporary exemptions to new, stricter pilot duty/rest rules (FDTL) after IndiGo's widespread flight cancellations caused passenger chaos, leading to accusations of commercial pressure overriding safety. The DGCA had framed the rules for public good. Now, its reverse action undermines the very safety norms for a major carrier. Effective from November, the new FDTL rules aimed to reduce pilot fatigue, which IndiGo violated. The airline failed to comply with the rule citing planning gaps, leading to over 1,000 flight cancellations and significant passenger disruption, last week. The DGCA readily granted IndiGo temporary exemptions (until February 2026) from certain night duty and weekly rest rules ignoring the passenger safety aspect that was behind framing such rules. Other domestic airlines are following the DGCA rules.

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The Airline Pilots' Association of India (ALPA), a major aviation safety body and welfare association for Indian pilots, representing them globally through IFALPA, focused on safety, pilot welfare, and regulatory engagement, raised safety concerns with the DGCA over the exemption of the duty roster rules and accused the DGCA of caving in to IndiGo's monopoly and compromising passenger safety for commercial convenience. The DGCA exemption now allows IndiGo to ignore the night-duty rule until February 10 while other Indian domestic airlines have been following the rule and operating their flights normally. The ALPA accused IndiGo of engineering the current crisis. The ALPA said the widespread flight disruptions stemmed from IndiGo's failure to engage in proactive resource planning, despite having a two-year window to prepare for the full implementation of the revised Flight Duty Time Limitation (FDTL) rules.

The pilots' body alleged that the situation pointed to an“artificial pilot-shortage narrative” created by the airline's“lean manpower strategy” to force the DGCA to grant exemptions from the stricter new norms. The Pilots' body has strongly objected to the DGCA granting IndiGo temporary exemptions, calling the decision“selective, unsafe,” and a“dangerous precedent” that compromises passenger and crew safety. It claimed that the airline expanded its winter schedule while fully aware of the upcoming FDTL norms and that the current chaos is an“immature pressure tactic” to secure commercial benefits by bypassing safety regulations. The ALPA appears to be absolutely right. The DGCA and the government have clearly failed to regulate and they are equally responsible for the current chaos during the peak season of the business. Foreign tourists travelling through India are totally flabbergasted. IndiGo flight cancellations caught those, who are already in India, totally wrong footed. IndiGo's indignant action has come at a time when India expects a strong tourism growth, potentially exceeding 10-10.5 million visitors in 2025, driven by the US, UK, and growing Asian interest.

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If anything is to be learnt from IndiGo's latest action taking the country's air travellers for a ride, it is that the government should immediately step in to break IndiGo's near monopoly status in the domestic civil aviation sector. The government must frame a law that will restrict the market share of a domestic airline to 30 percent. IndiGo's overwhelming local market share of around 70 percent by operating around 2,000 flights daily across some 100 domestic destinations could even pose a potential security risk for the country in times of war. For now, the airline deserves exemplary punishment from the government for its unacceptable business behaviour. The situation also gives an opportunity to the government to prove that it is not hand in gloves with private operators.

Historically, the civil aviation department is perceived as one of the government's most corrupt wings. In his book“An Outsider Everywhere – Revelations by an Insider” (Konark Publishers), former civil aviation secretary M K Kaw detailed how in 1997, then civil aviation minister C.M. Ibrahim acted under pressure from Jet Airways to thwart the Tata group's bid to start an airline in India in association with Singapore Airlines. More recently, India's Central Bureau of Investigation (CBI) closed a corruption case against former Civil Aviation Minister Praful Patel who is now a BJP ally. (IPA Service)

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