Column: FAA downgrade a wakeup call
Congo, Gambia, Haiti, Nauru, Swaziland, Zimbabwe, etc. It is a humiliation that will take a long time to heal.
The FAA downgrade comes at a time when India was creating a positive investment climate in its aviation sector with several far-reaching reforms. The biggest game-changer was allowing 49% FDI by global airlines into Indian carriers. Others included—allowing entry of A380s, direct import of ATF, ECB for airlines and MRO, removal of import duty on aircraft parts, opening of India’s bilateral rights to LCCs, abolition of the aircraft acquisition committee, privatisation of leading Indian airports, etc. The downgrade may set us back by years.
How bad can it be?
Sanctions by aviation regulators under International Civil Aviation Organization (ICAO) norms, typically, have a domino effect. So far, thankfully, we haven’t seen a similar action in key regions like EU (EASA), Singapore (CAAS), Japan (CAB), UAE (GCAA), etc. There are, however, media reports highlighting a likely increase in scrutiny of Indian aircraft landing in these countries. That may affect airline schedules and upset passengers may opt for other airlines.
Should a global downgrade happen, the outcome could be significant for India.