MUMBAI: The weak rupee has rendered the government subsidy for the annual Haj flights inadequate.

The problem began in April when tenders floated for operating these flights allowed airlines to quote their price in Indian rupee and the practice of using dollar rates was done away with.

With the rupee having devalued significantly since then, the chosen airlines have now expressed their inability to honour their commitment for the price they had quoted earlier. The first of the Haj chartered flights, which will be operated with wide-bodied aircraft from 21 airports in India to Jeddah/Madina in Saudi Arabia, are scheduled to begin on September 7. A weak rupee and its attendant consequences have led to urgent negotiations between the Union ministry of civil aviation, the aviation regulator and the airlines concerned, Air India and Saudi Arabian Airlines, said an aviation source. Air India spokesperson was unavailable for comment.

“Despite these unresolved issues, the Haj flights are most likely to be operated as scheduled,” said advocate Rizwan Siddiquee, who has been tracking the matter for his airline clients. He said that the government had sanctioned Rs 650 crore this year for Haj flights, scheduled to ferry 1.21 lakh pilgrims from/to India. “When the tender was floated, the rupee to dollar exchange rate was Rs 55, which is about 25 per cent less than what rupee is valued today against the dollar,” he added. Both Air India and Saudi Arabian Airlines had paid the earnest money deposit as per the condition in the agreement. About a month ago, the airlines took up the matter with the government saying they could not operate these flights for the fare (in rupees) they quoted in April, he added.

Airline sources said that the civil aviation ministry had agreed to pay the difference. But there was no official confirmation on the same from the ministry. While ministry sources said the Haj subsidy burden had gone up greatly this year because of rupee devaluation, they did not divulge details on the quantum of increase. “The civil aviation ministry has decided to provide for the shortfall and it is just a matter of a week before the issue is resolved,” said a ministry source.

