Aviation regulator plan in air pocket

Finance, company affairs ministries say move will undermine Competition panel.

The civil aviation ministry's plans to set up an aviation economic regulator has not gone down well with the finance ministry and the ministry of company affairs.

The finance and company affairs ministries are of the view that the setting up of the aviation economic regulator will undermine the importance of the Competition Commission.

"The Competition Commission has been set up to look into these aspects across various sectors. Both finance and company affairs ministries are of the view that in such a scenario, there is no need for a separate regulator for a sector to monitor the business, pricing and competition aspects," said an official.

It has been pointed out that the main purpose of setting up the aviation regulator is to deal with issues of pricing and competition in the airport sector, after the entry of private companies.

The two ministries have said the Competition Commission also deals with the same issues and the setting up of the aviation economic regulator will be duplication of functions.

The aviation economic regulator, which will be different from Director General of Civil Aviation dealing with the technical aspects of aviation, was to prescribe pricing of user charges, operations of airlines as well as airports.

The civil aviation ministry has been pushing this idea as it was embarking on a greater privatisation of airports as well as giving permission for more airlines to start operations.

The civil aviation ministry is looking at two options to set up the regulator "" either bringing in a separate Bill or introducing provisions in the proposed civil aviation policy.