India could replace the Directorate General of Civil Aviation (DGCA) with a statutory aviation regulator that has greater financial and administrative independence, under a restructuring proposal submitted to the Ministry of Civil Aviation.
The proposal recommends creating a Civil Aviation Authority of India (CAAI) through a new law. The proposed body would have its own governing board, recruitment powers and dedicated funds, allowing it to hire specialised personnel and invest in technology without relying entirely on government budget allocations.
Panel flags manpower and safety concerns
The report was prepared by a special committee headed by former economic advisor Lalit Kumar Chandel. It was constituted in August 2025 and submitted its recommendations in November.
The committee has said the DGCA's current status as an attached office of the civil aviation ministry limits its operational independence. It also pointed to shortages in technical expertise, manpower and enforcement capacity, as well as delays in addressing safety-related findings.
The regulator has nearly half of its sanctioned positions vacant. A parliamentary standing committee had earlier said that recent aviation incidents pointed to “systemic rather than episodic failures” in India's aviation safety architecture.
The proposed authority would have greater control over recruitment, salaries and expenditure. The committee has also recommended immediate measures such as hiring technical personnel and strengthening DGCA's regional and sub-regional offices while the legislative process is underway.
Passenger levy proposed to fund regulator
The proposed CAAI would generate revenue through service fees, certification charges, penalties and a levy on passengers. A ministry study cited in the report estimates the passenger charge at Rs 15 per departure.
The committee said this financial independence would help the regulator avoid constraints linked to government budget cycles. Government grants could continue until the authority becomes self-sufficient, while its accounts would be audited annually by the Comptroller and Auditor General of India.
An independent ombudsman has also been proposed to handle passenger complaints involving cancellations, delays, lost baggage and other service-related issues.
DGCA's oversight under scrutiny
The restructuring proposal comes amid increased scrutiny of DGCA's safety oversight. A parliamentary panel found 787 of the regulator's 1,630 sanctioned posts vacant. A DGCA audit covering January 2025 to February 2026 also identified recurring technical defects in 377 of 754 aircraft inspected.
The regulator faced further criticism after IndiGo cancelled more than 2,500 flights over three days in December last year. DGCA had granted the airline exemptions from crew-fatigue rules during the disruption. The regulator later removed four inspectors overseeing IndiGo and a senior officer, while the ministry ordered an internal inquiry.
The proposed overhaul also comes ahead of a five-member US Federal Aviation Administration team visiting India from November 16 to 20 to assess the country's aviation safety oversight.
An Indian Civil Aviation Service, a dedicated Group 'A' cadre of trained officers, has also been recommended as a longer-term measure to strengthen regulatory capacity.