- The Centre is preparing a comprehensive package of structural reforms to lower barriers for new airlines and attract investment across the aviation ecosystem.
- The Ministry of Civil Aviation (MoCA) is reviewing key provisions including the 0/20 rule, licensing norms, pilot availability, and ownership structures to simplify market entry.
- The objective is to make aviation more competitive by reducing unnecessary regulatory barriers while maintaining safety, security, and financial discipline.
- MoCA is examining easing restrictions that separate airport and airline ownership to allow integrated aviation businesses with competition safeguards.
- The Centre is considering removing restrictions on airline ownership in airport operators and vice versa. The Ministry of Civil Aviation is preparing a concept note for consultations with NITI Aayog and other ministries.
- Air India, jointly owned by Tata Sons (74.9%) and Singapore Airlines (25.1%), has expressed interest in expanding into the airport business.
- The Ministry has submitted a proposal to the PPPAC for the third round of airport privatisation of 11 airports, which requires Cabinet approval.
- The government is revisiting the divestment of AAI's 26% stake in Delhi and Mumbai airports.
- Aviation analysts caution that cross-ownership could lead to risk concentration and conflicts of interest, such as preferential slot allocation and gate access.
- In 2019, Tata Group attempted to acquire a 55.2% stake in GMR Airports but the deal fell through due to a conflict of interest involving its airline holdings (Vistara and AirAsia India). Since then, those airlines have been merged into Air India and Air India Express.
India's Ministry of Civil Aviation (MoCA) is preparing a comprehensive reform package to ease airline ownership rules and simplify market entry, aiming to enhance competition and attract investment in the aviation sector. The proposed changes include revising the 0/20 rule, which currently mandates that an airline must deploy at least 20 aircraft on domestic routes before commencing international operations.256
Sources indicate that the government is considering removing restrictions on airline ownership in airport operators and vice versa, potentially allowing groups like Tata Group-owned Air India to acquire stakes in airports. This move comes amid Air India's interest in expanding into the airport business, as the Ministry prepares a concept note for consultations with NITI Aayog and other ministries.78
However, aviation analysts caution that such ownership overlaps could lead to greater risk concentration and conflicts of interest, particularly regarding operational decisions like slot allocation and gate access. Existing airport concession agreements impose limits on airline ownership, with tighter restrictions for major airports like Delhi and Mumbai.11
The discussions also coincide with the government's proposal for the third round of airport privatization, which includes 11 airports. The Ministry is revisiting earlier plans for the Airports Authority of India to divest its stake in GMR-operated Delhi International Airport and Adani-operated Mumbai International Airport. Queries sent to Tata Group and Air India went unanswered by publication time.
“The Ministry of Civil Aviation is reviewing the 0/20 rule, licensing norms, and pilot availability to simplify market entry. Separately, analysts warn that cross-ownership could create conflicts of interest over slot allocation and gate access, as groups like Air India eye the airport business.”
