<p>It is not easy for an airline to turn a profit in India and a lot of issues such as fare caps and high taxes on aviation turbine fuel (ATF) have to be resolved, a senior IATA official said on Sunday.</p>.<p>Philip Goh, Regional Vice President for Asia Pacific of International Air Transport Association (IATA), made the remarks during a press conference at the 78th annual general meeting of the global airlines body here.</p>.<p>When asked if Vistara and Air India should be merged by the Tata Group, he replied, "Both (Vistara and Air India) are full- service carriers. Vistara is still quite small and although they have been in business for 5-6 years, they are still loss making. It is not easy to turn a profit in India. A lot of issues to overcome."</p>.<p>Goh said he is sure that some sort of discussion must be happening between the Tata Group and Singapore Airlines on the merger of Air India and Vistara.</p>.<p>"It does make sense to look at synergies between two similar full-service carriers,” he told reporters.</p>.<p>While talking about India, Goh said that pricing ought to be left to airlines and should not be governed the way it is being governed.</p>.<p>Goh said that taxation - on fuels and other things - is always an issue for the airlines.</p>.<p>Any measures that are taken by the government that increase costs for airlines is bad for the economics of the aviation sector, he said.</p>.<p>The civil aviation ministry had imposed lower and upper limits on domestic airfares based on flight duration when services were resumed on May 25, 2020, after a two-month lockdown due to the pandemic. For example, airlines currently cannot charge a passenger less than Rs 2,900 (excluding GST) and more than Rs 8,800 (excluding GST) on flights with a duration of less than 40 minutes.</p>.<p>The Tata Group took control of Air India and its subsidiary Air India Express on January 27 after successfully winning the bid for the airlines on October 8 last year.</p>.<p>The Tata Group has 83.67 per cent shares in AirAsia India whereas the remaining stake in the airline is with Malaysian carrier AirAsia Berhad.</p>.<p>Competition Commission of India had on June 16 said it has approved the proposed acquisition of the entire shareholding of AirAsia India Ltd by Air India Ltd.</p>.<p>Vistara is a joint venture company with the Tata Group and Singapore Airlines owning 51 per cent and 49 per cent shares, respectively.</p>.<p>"I think Tata's initiative (to merge AirAsia India with Air India) within their own group is sensible. I think that if you have four vehicles within the same group, you have to find some ways to rationalise the synergies within the group,” Goh said.</p>.<p>If Tatas form a strategy correctly, Air India could become a very powerful player in the Indian international market, he noted.</p>.<p>Air India can certainly be strengthened and if anybody could do it, it is Tatas that could do it, he said.</p>.<p>"It is very positive for India that this has happened and we look forward to seeing how this would play out in the next couple of years,” he noted.</p>
<p>It is not easy for an airline to turn a profit in India and a lot of issues such as fare caps and high taxes on aviation turbine fuel (ATF) have to be resolved, a senior IATA official said on Sunday.</p>.<p>Philip Goh, Regional Vice President for Asia Pacific of International Air Transport Association (IATA), made the remarks during a press conference at the 78th annual general meeting of the global airlines body here.</p>.<p>When asked if Vistara and Air India should be merged by the Tata Group, he replied, "Both (Vistara and Air India) are full- service carriers. Vistara is still quite small and although they have been in business for 5-6 years, they are still loss making. It is not easy to turn a profit in India. A lot of issues to overcome."</p>.<p>Goh said he is sure that some sort of discussion must be happening between the Tata Group and Singapore Airlines on the merger of Air India and Vistara.</p>.<p>"It does make sense to look at synergies between two similar full-service carriers,” he told reporters.</p>.<p>While talking about India, Goh said that pricing ought to be left to airlines and should not be governed the way it is being governed.</p>.<p>Goh said that taxation - on fuels and other things - is always an issue for the airlines.</p>.<p>Any measures that are taken by the government that increase costs for airlines is bad for the economics of the aviation sector, he said.</p>.<p>The civil aviation ministry had imposed lower and upper limits on domestic airfares based on flight duration when services were resumed on May 25, 2020, after a two-month lockdown due to the pandemic. For example, airlines currently cannot charge a passenger less than Rs 2,900 (excluding GST) and more than Rs 8,800 (excluding GST) on flights with a duration of less than 40 minutes.</p>.<p>The Tata Group took control of Air India and its subsidiary Air India Express on January 27 after successfully winning the bid for the airlines on October 8 last year.</p>.<p>The Tata Group has 83.67 per cent shares in AirAsia India whereas the remaining stake in the airline is with Malaysian carrier AirAsia Berhad.</p>.<p>Competition Commission of India had on June 16 said it has approved the proposed acquisition of the entire shareholding of AirAsia India Ltd by Air India Ltd.</p>.<p>Vistara is a joint venture company with the Tata Group and Singapore Airlines owning 51 per cent and 49 per cent shares, respectively.</p>.<p>"I think Tata's initiative (to merge AirAsia India with Air India) within their own group is sensible. I think that if you have four vehicles within the same group, you have to find some ways to rationalise the synergies within the group,” Goh said.</p>.<p>If Tatas form a strategy correctly, Air India could become a very powerful player in the Indian international market, he noted.</p>.<p>Air India can certainly be strengthened and if anybody could do it, it is Tatas that could do it, he said.</p>.<p>"It is very positive for India that this has happened and we look forward to seeing how this would play out in the next couple of years,” he noted.</p>