The New Nation - Internet Edition

A GOVERNMENT committee has reportedly recommended giving permission to low-cost airlines to use the Zia International Airport (ZIA) for carrying passengers at cheaper fares in spite of Biman's apprehension that it would hinder the growth of local airlines flying on international routes. The committee submitted its report to the Ministry of Civil Aviation late last month stating that low-cost airlines should be allowed to use ZIA to fly to countries with whom Bangladesh has bilateral air service agreement, provided they operate at least three weekly flights from Chittagong.

A low-cost carrier actually offers low fares but omits many traditional passenger services. Legally, there is no difference between a full-service and a low-cost carrier as both require approvals from the regulatory authorities and have to take similar safety measures. Biman authorities said Bangladeshi carriers suffer from 'competitive disadvantage' due to higher fuel price and high tax on aircraft spares. If low-cost carriers are allowed to operate to and from ZIA, this disadvantage would deepen and the local carriers would suffer. This would seriously hinder the government's initiative to develop private sector airlines, they said. Besides Biman, there are four local private airlines operating mostly on domestic routes. They are planning to expand services to different international destinations.

An aviation analyst reportedly said, allowing low-cost airlines would rather increase 'competition' and thus attract more passengers. However, withdrawal of taxes both on fuel and aircraft spares may turn local more cost efficient. It was stated that 40 per cent tax on fuel stop local airlines from being competitive in relation to foreign airlines. The civil aviation authority (CAAB) earlier granted permission to a low-cost carrier, Air Arabia of the United Arab Emirates to operate international flights from Shah Amanat International Airport at Chittagong to Sharjah. The whole thing should be examined from a long-term perspective.