Umesh Kumar Baveja, who was previously Vice-Chairman at Cairn Energy, is preparing to launch a regional airline in June. He is currently in talks with private equity players to raise around Rs 100 crore for the new venture, called Rahi Air. The launch of the airline will coincide with the opening of an airport in Gulbarga in northern Karnataka,
which will also be built by Baveja's firm Regional Airport Holdings International. "The market we are addressing requires under-20-seater aircraft and there is no commercial airline operating in this space. That is one of the main reasons we decided to start our own airline." said Baveja. Rahi Air, a joint venture between IL&FS Transportation Networks and Comet Infra-Developments, will ply on the Gulbarga-Hyderabad and Gulbarga-Bangalore routes to begin with and will have two flights a day, six-days-a-week, according to a report by Radhika P Nair in The Economic Times. "IL&FS is an investor in the project and this will make it easier to raise capital but viability is the most critical issue," said Kapil Kaul, CEO - India and South Asia, Centre for Asia Pacific Aviation. Baveja is the second entrepreneur this year to announce the launch of a new airline. In February, Vijayawada-based infrastructure company LEPL Projects, founded by Ramesh Lingamneni, announced the launch of a regional airline called Air Costa. In an industry struggling due to high operating costs, entrepreneurs such as Baveja are betting on government incentives that encourage regional operators. This includes a uniform sales tax of four per cent on fuel for aircraft with a take-off weight of less than 40 tonnes. For scheduled airlines such as Jet Airways and Kingfisher Airlines, tax on fuel is among the biggest cost components as it varies for each state and can be as high as 40 per cent.
Click here to see the original article>which will also be built by Baveja's firm Regional Airport Holdings International. "The market we are addressing requires under-20-seater aircraft and there is no commercial airline operating in this space. That is one of the main reasons we decided to start our own airline." said Baveja. Rahi Air, a joint venture between IL&FS Transportation Networks and Comet Infra-Developments, will ply on the Gulbarga-Hyderabad and Gulbarga-Bangalore routes to begin with and will have two flights a day, six-days-a-week, according to a report by Radhika P Nair in The Economic Times. "IL&FS is an investor in the project and this will make it easier to raise capital but viability is the most critical issue," said Kapil Kaul, CEO - India and South Asia, Centre for Asia Pacific Aviation. Baveja is the second entrepreneur this year to announce the launch of a new airline. In February, Vijayawada-based infrastructure company LEPL Projects, founded by Ramesh Lingamneni, announced the launch of a regional airline called Air Costa. In an industry struggling due to high operating costs, entrepreneurs such as Baveja are betting on government incentives that encourage regional operators. This includes a uniform sales tax of four per cent on fuel for aircraft with a take-off weight of less than 40 tonnes. For scheduled airlines such as Jet Airways and Kingfisher Airlines, tax on fuel is among the biggest cost components as it varies for each state and can be as high as 40 per cent.