The Hindu Business Line : Aviation infrastructure

This is with reference to "Consolidation in the air", (Business Line, January 20). The competition concerns arising from the merger are seen as minimal because of the capacity expansion plans of other airlines. However, such plans, though substantial, are unlikely to provide a credible threat to the combined entity in the short run, given the existing infrastructure constraints.

There is an urgent need to improve aviation infrastructure to relax this structural barrier that is blocking airlines' expansion plans.

In its absence, competition would be limited, and Jet Airways will have little incentive to pass on the benefits of economising on its infrastructure.

With the resulting dominance of Jet in peak hour traffic, Jet may hike fares during peak hours, cross-subsidising those in non-peak hours to out-compete other airlines. It is already doing this on certain routes. The DGCA should take into account these factors before granting Air Sahara's domestic and international routes and parking slots to Jet Airways.

Manish

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