The Directorate General of Civil Aviation's (DGCA's) clumsy handling of the contents of financial audit report of airlines has only added to the aviation industry's woes, aviation consultancy and research firm Centre for Asia Pacific Aviation (CAPA) said on Wednesday.
Slamming the aviation regulator, CAPA said that safety-related matters pertaining to the aviation sector are extremely sensitive. "Instead, the report was leaked to the media. It is hard to imagine an act more designed to undermine an entire aviation industry," it said.
The leaked contents created confusion and fear for passengers, besides denting India's international image, the research firm said.
"Investors will be reluctant to provide funds when the government is apparently questioning the safety of the entire system," said Kapil Kaul, CEO, South Asia, CAPA. "And there is a risk that travel insurance companies will withhold insurance from travellers - something that happened in Indonesia when the European Union blacklisted that country's system, with grave financial consequences for the industry and for tourism."
The report cited shortcomings at all carriers. "Ironically, as much as anything, this is an indictment of the regulatory oversight regime itself," it said.
"If in fact things have deteriorated to the level suggested, it is hard to imagine how this can have come as a surprise to the regulator - begging the question of why remedial action had not been taken before. Has there been any reinforcement of the regulator's skills? Has budget been provided to ensure that oversight is improved? Apparently not. To point the finger at the airlines in this way is little more than an inexcusable dereliction of duty on the part of the government. The buck stops with the airlines, but for government seemingly to wash its hands of any responsibility is inconceivable," CAPA said.
"Despite the tone of the leaked report, the DGCA has not grounded the industry. Thus it presumably does not perceive a clear and present danger to public safety - otherwise decisive action should have been taken to ground the airlines at risk," the report said.