Tata's Vistara finally gets Centre's nod to fly overseas

The Centre gave an all clear to Tata-Singapore Airlines' joint venture Vistara to fly international routes, in one of its last decisions before the Election Commission announced dates for the upcoming Lok Sabha elections.

Vistara is now the fifth Indian carrier to be granted approval for flying on international routes, "following suggestions from the Group of Ministers formed to look into the issue", a senior official told Business Standard.

After receiving the approval, the airline has asked to operate daily flights between New Delhi and Colombo. The report quoted a source as saying the company had sought bilateral rights to Sri Lanka and New Delhi slots for flights which operate with Airbus A320 aircraft.

Vistara received this nod after a long delay due to an ongoing investigation into AirAsia India on allegations of bribery to secure international flight approvals. In a first, five Cabinet ministers had been raked in to constitute a committee led by Finance Minister Arun Jaitley to decide whether Vistara should be granted the permit. The authority for this rests usually with the Directorate General of Civil Aviation (DGCA).

The carrier has been recording losses for the past three years. This delay also forced the company to tweak its business model. It was already struggling in India due to the extreme competition in the domestic aviation sector from low-budget carriers like IndiGo (InterGlobe Aviation) and GoAir.

Vistara tried to expand its network, announcing as many as 16 new daily flights to destinations like Raipur and Dibrugarh. After the airline added 20 planes to its fleet, it approached the government to secure an international flights permit and sought to start flights to Bangkok, Phuket and Male by the winter of 2018. But policy logjam disturbed these plans.

"When India's third full-service carrier launched, it did so with its eye on the opportunities in the international market. More than three years later, Vistara remains a solely domestic carrier, thanks to Indian regulations," aviation consultancy firm CAPA had said.