If India has to have open skies, let the best man win: Fernandes

India is the only country which has a rule like this, said Air Asia CEO Tony Fernandes, referring to the aviation ministry changing the 5/20 rule yesterday. "We got 20; I would have preferred 0, but it is a step forward."

He is hoping that the airline will have 20 aircraft in another 18 months. Currently, it has 6 aircraft. He admits that there was pressure on the government from existing carriers to recast the policy.

The government should stay out of trying to regulate too much, he said, adding that fuel taxes are still prohibitive in India. "If the country has to have open skies, let the best man win."Below is the interview of Tony Fernandes with Ronojoy Banerjee on CNBC-TV18.Q: Let us get your reaction first on the 5/20 rule because that clearly has been the most contentious issue over which you have also locked horns with the incumbents. Are you satisfied with the modification of the 5/20 rules? A: India is the only country which has a rule like this. However, we will take whatever we can get, I am pretty happy with it. At least we know, we have some clarity that if we get to 20 planes we can do international. Preferably I would have liked zero but will take whatever we can get. It is a step forward. Q: Let us just speak a little bit about AirAsia and how this might impact you because you have about seven to eight aircrafts right now. So, how long will it take for you to ramp up to a fleet strength of 20 which will then make you eligible to fly overseas? A: We have six at the moment. We are trying to ramp up to 10 by the end of the year. We will try and put in another 10 during the year, next year. So, maybe, in another 18 months. Q: You are known as one of those few CEOs who speak their mind. So, we really want your honest opinion on this. Do you feel that somewhere there was pressure from the incumbents or the Federation of Indian Airlines (FIA) which perhaps forced the government not to completely do away, dispense with the 5/20 rule, only to modify it? Do you feel there was some pressure from the incumbents? A: I think without a doubt; the government is smart, the government knows that this is the only country in the world that has this rule but I suppose they succumbed to a little bit of pressure from the incumbents but fair credit to them. There must have been a lot of pressure on them but at least they changed it. The easy option would have been to do nothing. So, I give credit where credit is due and the Prime Minister had said he was going to change it and I am sure he would have liked to have scrapped it completely but I suppose there was a lot of pressure from the existing airlines here.Q: I did pose that question in a certain way to the minister yesterday as to why did he try to make everyone happy but then moving away from that since you are actually categorically saying that there was pressure from the incumbents, finally then yesterday the government indicated that the headroom for growth could be as high as 60-70 percent from 20-22 percent currently. How realistic is that target and what are the challenges facing the aviation sector today because regulating air fare that is something that government indicated, at least in the times of calamities, clearly seems to be one of the issues that you have also talked about, tell us more?A: I think you just mentioned one. The government should stay out of trying to regulate too much, one. Two, the fuel taxes are still prohibitive and three, if India really has to be an aviation hub, don’t have open skies, have open markets, let the best man win. The jobs that can be created are huge if this is an open aviation market.