Kingfisher Airlines’ promoter Vijay Mallya has demanded that state governments 'underwrite seats' or, in other words, buy a certain number of seats in every flight of Air India and other private airlines.

Mallya made this suggestion at the first meeting of a government committee to formulate the civil aviation policy. The committee met on December 26 under Civil Aviation secretary Nasim Zaidi. “He (Mallya) stated that the state governments be asked to consider seat underwriting as the states were ultimate beneficiaries of the connectivity,” said the minutes of the meeting.

In 2011, Kingfisher had a passenger load factor of 74.5-88.4 per cent. This means about 20 per cent empty seats per month as per a report in Indian Express by Smita Aggarwal.

While seeking government support for “private airlines in distress”, Mallya, chairman of the CII national committee on civil aviation, said the practice is common in developed countries. Kingfisher has accumulated losses of over Rs 4,200 crore. It lost its number two position in the domestic market to five-year old budget carrier, IndiGo, in 2011.

Mallya has also asked for a revision of guidelines under which all airlines have to earmark a share of their seats for services to the North-East and Jammu and Kashmir.