A new Indian Aviation regulator and a new fee for you

Last week was full of news articles about how a new Aviation regulator is coming up for India. The currently existing Directorate General for Civil Aviation (DGCA) will soon be replaced with a Civil Aviation Authority (CAA), which will be an autonomous regulator for Indian civil aviation, unlike DGCA which is under the Ministry of Civil Aviation in India.

Business Standard published a very good news report on the proposed structure of the new aviation regulator, and how it needs to be self sufficient. Unlike the DGCA, CAA will need to earn its own bread and butter. Here is how it proposes to do that:

CAA will primarily get revenues from three sources: First, the Airports Authority of India will share a portion of air navigation service charges, bringing to CAA around Rs. 32 crore annually. Second, fees for licensing of air traffic control services will bring in around Rs. 40 crore a year. And, third, a surcharge of Rs. 5 per passenger will be levied to add about Rs, 50 crore to the resources of CAA.

So there you have it. Your ticket costs will go up by another Rs. 5 when the new regulator comes into play, which I think will be at least a year away. I’m happy to pay this for the salaries of the regulator, as long as they promise to hire and fill the entire lot of people needed. The current regulatory setup has over a couple of 100s of positions vacant, all due to bureaucracy, and I hope this is sorted in the days ahead.

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About Ajay Awtaney

Ajay is a financial services pro, working to bring order to the chaos of the financial industry on an everyday basis! Beyond that, he dons the hat of India's favourite frequent traveller, trying to help people elevate their travel experience via tips and tricks they never knew before, or introduce them to the world of miles and points. Armed with an MBA from MDI Gurgaon and graduate degree in computer science from the University of Delhi, Ajay brings a systematic and objective approach on the table for his audience in dissecting travel and loyalty programs in India and around the world, and how to benefit from them. Ajay has been quoted in various reputed traditional and online media including The Hindustan Times, Inside Flyer, Bloomberg, DNA India, Conde Nast Traveller, The Telegraph, Mumbai Mirror, Mint, MoneyLife and The USA Today.

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