Schemes like UDAN try to promote regional connectivity but end up suffering from bureaucratic hurdles, infra gaps and uneven success. The schemes struggle over connectivity
When I opted to visit Vietnam recently, I chose VietJet, the country’s ultra low cost airlines. Dubbed the ‘Ryanair of Asia’, generating profits through ancillary services, VietJet is a phenomenon. Founded in 2007 and beginning operations in 2011, the airline rose to make flying affordable for the average Vietnamese and now commands over 40 per cent of the domestic aviation market and is expanding aggressively in the Asia-Pacific region including India.
What makes VietJet noteworthy is not merely its low ticket prices or quirky branding (it famously launched with bikini-clad flight attendants, drawing both criticism and publicity), but its strategic discipline. Offering attractive fare bundles, promotional sales, and creative loyalty programmes to drive volume, it has balanced aggressive pricing with clever cost management, lean operations, and an eye on ancillary revenue, charging for meals, seat selection, baggage and in-flight entertainment. A glass of water too, has to be paid for, but these charges allow the base ticket price to remain tantalisingly low. VietJet has remained profitable for much of its existence, thanks to smart fleet management, leasing strategies and non-ticket revenues.
By contrast, India has had a chequered relationship with low-cost flying. The early 2000s saw a boom in budget carriers all promising affordable skies. Today, IndiGo dominates with a market share of 64 per cent, but the sector has had its share of turbulence. Unlike VietJet, most Indian budget carriers have struggled to keep fares low while staying profitable. Aviation turbine fuel (ATF) taxes, congested airspace, expensive airport fees, and erratic policy environments require navigating a complex ecosystem. Government schemes like UDAN (Ude Desh Ka Aam Naagrik) try to promote regional connectivity but end up suffering from bureaucratic hurdles, infrastructure gaps and uneven success, struggling to fill gaps in regional connectivity by subsidising flights to smaller towns with uneven impact.
The success of any budget carrier naturally depends on the larger ecosystem and what India lacks is alignment across policy and infrastructure, airports ready for low turnaround times, minimal parking fees and rationalised fuel taxes. While Indian carriers like IndiGo too have mastered cost control via aircraft leasing, high aircraft utilisation and no-frills service, unpredictable ATF prices and airport congestion are a bug bear with high airport fees hampering low-cost operations.
Vietnam’s VietJet thrives not because its focus is on lean staffing, quick turnaround, and limited onboard amenities but because of Vietnam’s aviation environment that realistically deserves more credit to help remain nimble enough to maximise aircraft usage, turn around flights quickly and operate on routes that make economic and strategic sense.
The Vietnamese government has taken a more facilitative approach to private airlines, allowing competition to flourish focusing on infrastructure expansion, simplified regulatory frameworks, and strategic bilateral air service agreements. While most countries embrace the low-cost airline model, Vietnam’s VietJet exemplifies a sharper, more agile approach with better regulatory support, streamlined costs, and a bolder international footprint. India has the larger market, but policy bottlenecks and infrastructure limitations are a huge constraint.
When I travelled in VietJet, the ultra low base fare was enticing but the costs gradually piled up, from check-in baggage payment for the first 20 kg, for food, water and seating costs (to avoid the ‘middle row’). Their planes were invariably late, more so on their domestic sectors where the delay could be as much as 10 to 15 hours. Once, a dispute at the Ho Chi Minh City airport required us to stay on board for hours after landing before we could deplane. Another reason for despair, was ‘bumping’ low paying passengers, arbitrarily postponing their bookings by two-three days. I was bumped too and had to rush to VietJet’s local office to readjust my schedule, requiring me to change my travel destination, making me wonder whether VietJet’s low cost tickets are worthwhile at all!
VietJet responds with a readymade marketing strategy, passengers are asked to fill in insurance claims and are promptly sent discount vouchers that can only be redeemed on future VietJet flights! India’s low cost airlines like IndiGo emphasise on-time performance, clean branding, and reliability, their profitability dependent on efficiency and volumes.
VietJet has shown that profitability and affordability can co-exist, necessarily with operational discipline and policy alignment. If India wants to truly fly its common citizen, not through slogans but in reality, it must treat budget aviation as more than a competitive industry. It must be treated as a national enabler required for connectivity, commerce, culture, and cohesion. The airline will have to be digital-first, data-driven, and fiercely regional in its strategy. Vietnam’s focused and flexible low-cost strategy could help India make flying truly affordable and sustainable so why not take inspiration from the red-and-yellow tails of a Vietnamese airline that’s changing the way Asia flies?
(Priyan R Naik is a columnist and independent journalist based in Bengaluru.)
