The first airline with foreign investment to operate in India took its maiden flight yesterday.
AirAsia India, set up by Malaysia’s AirAsia, India’s Tata Group and investment firm Telestra Tradeplace, flew from Bangalore to Goa.
Tickets for the flight went on sale for as little as £11, cheaper than a second-class train ticket between the two cities.
AirAsia’s promise to become the ‘lowest-cost’ airline in India has already triggered a price war with India’s existing low-cost airlines – IndiGo, Jet Airways’ JetLite, SpiceJet and GoAir.
Most of India’s domestic airlines are already suffering losses because of high fuel costs and intense price competition.
Only one of its six main carriers, IndiGo, has been making a profit in recent years.
India opened up its aviation market to foreign investment in 2012 in a bid to boost growth in the sector.
