Mumbai: Airline stocks on Wednesday climbed up to 5 percent after the much-awaited national civil aviation policy that seeks to strengthen regional connectivity and tap the sector's high growth potential was cleared by the Union Cabinet.
Shares of Spicejet soared 5.22 percent, InterGlobe Aviation rose by 4.32 percent and Jet Airways gained 2.91 percent on BSE.
Civil Aviation Minister Ashok Gajapathi Raju said the policy is a "game changer" and that the country's aviation sector is poised to become the world's third largest by 2022.
The policy has been finalised after nearly eight months since the Ministry came out with the revised draft in October 2015 and follows many rounds of deliberations with stakeholders. The NDA government had for the first time unveiled the policy draft in November 2014.
Initially, the policy was expected to be finalised in the last financial year as certain proposals were to be in effect from April 1, 2016.
However, the government had been moving back and forth on the policy seeking to sort out the differences among stakeholders including on 5/20 norm.
In the run-up to the framing of policy, various provisions including the issue of international flying norm witnessed extensive debate, with legacy carriers opposing any changes to the rule, while start-up airlines frantically demanding its scrapping.