The feasibility study conducted a year back by a finance ministry official and a director on the Indian Airlines board had said that if the airline goes ahead with the project then it will have to raise fares by 56% which will not go well with the passengers who will prefer to travel by other means of transport. Air fare in India is already one of the highest in the world.

The report said that the airline does not have the funds or the expertise to fly the small aircraft which has already been tried in the country by the loss-making Vayudoot. It was, therefore, not surprising to note that the airline has asked the government to finance the entire project as it has, in the past, taken accumulated losses of over Rs 900 crore due to wrongdecisions made by the ministry.

The BJP government's insistence that the Indian Airlines should fly the turbo-props even when it is bound to make losses is surprising, airline analysts said. The erstwhile Indian Airlines board of directors had serious reservations over the project and asked the management for more clarifications. The feasibility report had estimated a loss of Rs 70 crore for the airline from the small aircraft operations.

Interestingly, both Jet Airways and Sahara have applied to the government to operate small 30 to 50 seaters aircraft to tap the potential of the feeder airline market. Earlier, Chennai-based NEPC Airlines had downed shutters as it notched up massive losses flying these small aircraft.

Some of the major problems faced by the small airlines was non-availability of spares, qualified people for the small aircraft and absence of maintenance facilities. Since the announcement of elections, the civil aviation minister has gone on an overdrive and announced -- withoutconsulting both Air India and Indian Airlines -- a major expansion plan costing over Rs 2,500 crore to both the loss-making airlines. Of this, Air India is to buy aircraft worth Rs 2,000 crore while Indian Airlines will have to pick up the rest.