AirAsia to start India operations later this year

Malaysian low-cost carrier AirAsia on Saturday said its Indian operations should begin later in 2013 with flights for South India and the company would also look at setting up some ancillary businesses in the country.

"Though September may be too ambitious, we are hopeful of starting Indian operations later this year with three aircraft serving South India, " AirAsia Group CEO Tony Fernandes said. The airline would expand its services to other parts of the country in the second stage, he said.

Speaking to CNBC-TV18, Tony Fernandes says that he expects fierce competition in India and adds that the low-cost carrier is not looking at Mumbai and Delhi for now. The airline is to start operations with three aircraft and will add 1 aircraft every month.

AirAsia would also look at setting up ancillary services like air travel insurance and duty-free shops in the country, said Fernandes. AirAsia has already put in place a strong leadership team for its India operations, which is a joint venture with Tatas and Telestra Tradeplace.

Former TCS chief S Ramadorai has been appointed chairman while top industry leader Ratan Tata has been named as chief adviser to the board of AirAsia India.

Besides, R Venkataraman (former executive assistant to Ratan Tata) and Bharat Vasani (chief legal counsel of the Tata Group), are among the directors on the board.

AirAsia India is a joint venture of Air Asia, Tata Sons and Arun Bhatia of Telestra Tradeplace with 49:30:21 holding. AirAsia will be represented by Tony Fernandes and Kamarudin Bin Meranu. In May, Fernandes had named Mittu Chandilya as the CEO of AirAsia India.

AirAsia is expected to bring in competitive pricing in the Indian aviation market with its "nano" airfares. These announcements had come within days after aviation minister Ajit Singh said all the issues regarding AirAsia's India applications had been resolved.

(With inputs from PTI)