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Government to Stop New Domestic Carriers?

Parliament Commission Calls for a Halt to New Start-Up Domestic Carriers.

(5/24/2004) Commission IV of the National Parliament (DPR) have requested the Government stop issuing new operating licenses scheduled for domestic air carriers.

Quoted in the Indonesian-language Bisnis Indonesia, Commission IV member Maman Sulaiman said, "the Department of Communications must stop freely issuing new flight operating licenses and consider the sustainability of those carriers already in operation in order to create a healthy, competitive business environment."

At a recent meeting of the Indonesian Air Carrier Association (INACA) in Yogyakarta, that organization also called on the Government to curtail or cut back on the issuance of licenses to new domestic airlines.

Unsympathetic to calls to shrink the air travel market and commenting in a separate forum, the Director General of Air Communications, Cucuk Suryo Suprodjo, insisted that his office would continue to issue operating licenses to new carriers who fulfill the stated requirements and can demonstrate financial viability.

According to Bisnis Indonesia, the Government has issued 27 airline operating licenses, 23 of which remain in business.

Prior to the recent deregulation of the Indonesian domestic air carrier environment, five airlines dominated the Country's skies. Now, with the introduction of many new carriers, passengers are enjoying competitive air fare levels that, in some cases, rival the cost of trains and bus travel over the same sectors.