Wadia group plans low-cost airline

Indian business group Wadia is to join an ever-growing queue of companies wanting to launch a low cost domestic airline, the Economic Times reported Wednesday.

It said the group had sought permission from India's aviation regulator to launch a low cost carrier with a fleet of six aircraft.

• Vijay Mallya to launch low-cost airline

"We are finalising the business plan to enter the airline business. The business has huge potential in India," said a Wadia group official, who was not identified.

Earlier this month, India's liquor baron Vijay Mallya had said he was planning to launch a low cost airline to fly on domestic routes.

At least three other private international airlines have recently applied for permission to fly the domestic routes, offering fares expected to be about 20 to 30 per cent below prevailing market rates.

The country only has one low-cost domestic carrier, Deccan Airlines, which operates mainly in southern India.

High fuel costs and other operating fees such as landing and parking charges, which account for up to 15 per cent of an airline's expenditure, have kept airfares high in India and grounded most carriers entering the domestic aviation sector when it opened up nearly a decade ago.

The launch of low-cost airlines is expected to provide tough competition to India's other domestic carriers such as state-run Indian Airlines and private airliners Jet Airways and Air Sahara.

-- AFP