Indian carriers divided on more bilateral rights to Gulf countries | News

Indian carriers are divided on whether the Centre should give more bilateral rights to West Asian countries.

While Air India and SpiceJet have opposed it, stating the government should instead focus on building major Indian airports as hubs, Akasa Air and IndiGo have said a decision should be taken after a holistic analysis.

West Asian carriers such as Emirates and Qatar Airways have been asking India to increase bilateral rights so that they can operate more flights to and from India. However, carriers such as Air India say granting more bilateral rights to certain Gulf countries will impede the growth of its long-haul and ultra long-haul operations to places such as North America and Europe.

When asked about this at the Capa India Aviation Summit 2024, Air India Chief Executive Officer (CEO) and Managing Director Campbell Wilson said: “Indian carriers recently ordered more than 1,000 aircraft. We have an appetite for more. We are committing to that on the basis that there would be an economic return to that investment, which, if you add it all, is well over $100 billion … If the rug is pulled from under us (by granting more bilateral rights), and if we can’t fly those aircraft, we will not take them (aircraft).”

He said this would affect the ability of the Indian passenger to fly non-stop to long-haul destinations. Wilson talked about how certain hubs closer to India were just taking traffic from India and transferring 80-90 per cent of it to other parts of the world.

“They are feeding their own economy and their own hub, not India’s (economy),” he mentioned.

He said he was in the United Arab Emirates (UAE) during the week and there were talks about liberalising bilateral rights with India. He said the population of the UAE was less than any of the top 20 cities in India. “When we are talking about liberalising bilateral rights, we need to talk about who is opening what to whom,” he added.

SpiceJet CEO Ajay Singh stated it was critical that India focus on building its own hubs.

“That is absolutely critical. In this term of the government, we must get their focus and ensure that Indian hubs are not residing in the Middle East (West Asia) or in Southeast Asia. The beneficiary of that would be all airlines and not just IndiGo and Air India … All of us should make sure that Delhi, Mumbai, Bengaluru and Hyderabad become hubs and start to take a portion of the traffic that currently goes via Dubai, Abu Dhabi, and Singapore,” he added.

However, IndiGo and Akasa Air had a different opinion on the issue, stating that a decision should be taken only after considering various factors. When Business Standard asked IndiGo CEO Pieter Elbers for his opinion on Air India’s demand, he said bilateral rights should be looked at in a “holistic way”.

“You should not put them in the same basket. It depends on what the situation between different countries is, the history, the services … how things are going with them. So, I think it would require a more detailed and elaborate approach rather than just a statement that once you do this, you will do that. We will work with the government on that (bilaterals),” he added.

When the newspaper asked Akasa Air founder and CEO Vinay Dube on whether bilateral rights to West Asian carriers should be increased, he replied: “I think we have got a very strong (aviation) ministry. They want to do the right thing for India. And the right thing for India is never a 0-1 (binary) state as far as the Middle East is concerned.”

“There is a tremendous amount of trade that we do with the Middle East. And that trade requires us to fly there. My view is that this should be recognised by the ministry. That it is not just a question of trade partners in the other parts of the world. We have also got strong trade partners across the Middle East, whether it is Saudi Arabia, the UAE, Qatar, Kuwait, Bahrain, etc. I think the ministry recognises that,” he added.

Over 70 percent of passengers flying on Emirates, Etihad, and Qatar Airways flights connected to India utilised the airlines’ hubs in Dubai, Abu Dhabi, and Doha as transit points for travel between India and third countries in February this year, according to aviation analytics firm Cirium’s data, reviewed by Business Standard.

Qatar and the UAE have asked India for an increase in bilateral air traffic rights because their carriers have utilised their quotas.

First Published: Jun 05 2024 | 9:46 PM IST

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