4 Dec 2023
State-run airline connects India’s smaller towns with Northeastern cities. In April 2022, it carried just three passengers but charged the exchequer a lofty ₹6 crore.
Alliance Air deploys Hindustan Aeronautics Limited's (HAL) 15-seater Dornier aircraft. The central government funds flights from smaller towns to northeast cities under the northeastern connectivity scheme. It connects Dibrugarh (Assam) to Ziro, Tezpur, and Itanagar (Arunachal Pradesh). Between April 2022 and June 2023, it carried 1500 passengers, costing around ₹100 crore, or ₹6 lakh per passenger to the government.
While a burden, the government cannot scrap it as Alliance Air connects crucial northeastern airports near the Chinese border. Moreover, the Dornier aircraft is the first Made in India civilian fleet enjoying the government’s push.
Government put up Alliance Air for sale after its parent Air India’s takeover by Tata last year. There were no takers, as investors expected the government to clean up Alliance Air’s ₹4,326 crore debt, as it had done for Air India. The government recently gave ₹600 crore to clear its old debt carried forward from Air India.