Bhubaneswar: Uncertainty shrouds over launching of international flight service by low-cost airline AirAsia to Bangkok from here as the government has rejected the proposal.

Although, Culture & Tourism department had approved the proposal of AirAsia for launching flight service to Bangkok from Biju Patnaik International Airport (BPIA), the Finance department has turned down the proposal.

Sources said Air India's proposal to launch international flight to Bangkok from Gaya via Bhubaneswar posed as the biggest hindrance to clear proposal made by AirAsia.

AirAsia had asked for subsidy of Rs 1.70 lakh per flight for launching the service to Bangkok. Accepting the proposal the Tourism department had written to the Finance department seeking permission.

As Air India in its proposal did not mention about subsidy from the government for operation of flight to Bangkok, the state government is considering allowing for the flight operation without subsidy.

The future of the proposal by AirAsia now seems obscure after Chief Secretary Aditya Prasad Padhi and Finance department made it clear about the government's plan.

Sources in the General Administration (GA) department said that the direct flight on the same route could not be operated with subsidy after the government received without subsidy-proposal from Air India.

If Thai AirAsia is planning to launch non subsidised flight service, the state government will cooperate it, the official said.

On the other hand, the government cannot give its nod to Air India for launching flight to Bangkok from Bhubaneswar as its proposal is yet to get approval from Union Ministry of Home Affairs, he added.

As Odisha government is over burdened due to subsidy of Rs 1.70 lakh to AirAsia for operation of daily flight to Kuala Lumpur, another international flight service from Bhubaneswar with subsidy appears to be expensive for the government, sources said.

Further, the government is planning either to reduce or close the subsidy given to AirAsia for flight to Kua Lalampur after completion of one year of signing the MoU between the Tourism department and AirAsia Berhad in February next year.

Meanwhile, the Finance department has asked the GA department to call for Expression of Interest for operation of flight to Malaysian capital Kuala Lumpur from BPIA in Bhubaneswar without subsidy, sources said.