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Journalism of Courage
The chief executives of India’s major airlines IndiGo and Air India on Wednesday defended the government’s evident policy of not expanding bilateral air services agreements with countries that house global hub airports and whose airlines account for a significant chunk of international medium- and long-haul passenger traffic to and from India.
With major home-grown airlines investing heavily in expanding their international footprint, the government has been selective and cautious in expanding foreign carriers’ access to the Indian market, even as countries like the United Arab Emirates and Qatar, and their airlines, have been pushing New Delhi to allow them to carry more passengers to and from India.
IndiGo CEO Pieter Elbers said that it would be wrong to say that India is not granting additional bilateral rights to anyone, noting that India has over the recent years expanded air services agreements with some countries, which reflects that the country is open to revising pacts in cases where both sides have something to gain.
“The image that some like to portray that India is not giving any traffic rights is just wrong. India gives selective traffic rights wherever it makes sense…The opportunities are out there and the traffic rights are being given in a way taking into consideration whether they are consumed by both sides,” Elbers said at the Aviation India and South Asia 2025 summit in the Capital.
“We have put out massive orders as Indian operators… If there are certain destinations where 90 per cent of the seats are operated by non-Indian operators and 10 per cent operated by us, then that is the opportunity to fill those seats and then talk about potential expansion…The Indian government is taking the right steps when it comes to opening the market,” the Indigo CEO said.
Speaking at the same event, Air India’s MD and CEO Campbell Wilson said that the pace of liberalising the Indian skies should be such that it doesn’t undercut the investments being made by Indian airlines and the broader aviation ecosystem in the country.
“For some of the other carriers, upwards of 60, 70, and in some cases 90 per cent of what (passenger traffic) they are taking from India is transiting and going on to somewhere else…Indian carriers are investing tens of billions of dollars on wide-body aircraft to serve these markets directly…I firmly believe that it is in India’s interest to make sure that the pace of liberalisation is such that it doesn’t undercut the investments being made by Indian aviation players,” Wilson said.
Wilson also said that the issue of market access and imbalances doesn’t pertain to just bilateral air traffic rights, but also the shortage of slots at busy airports. The Air India CEO said that when it comes to some developed international markets, slot constraints at airports is a big challenge for airlines currently looking to expand their international footprint. He argued that various large overseas carriers were able to secure slots long ago, while carriers like Air India that are “starting somewhat later” don’t enjoy the same luxury.
The Indian government and major Indian carriers like Air India and IndiGo have ambitions to have more direct international connectivity from India and to turn the country into an international aviation hub. Both airlines have placed sizeable orders for wide-body aircraft to expand their international network, particularly in the long-haul segment. Long-haul travel on board Indian carriers, however, continues to remain a challenge as a significant number of passengers flying to far off destinations from India take connecting flights through major global hubs outside the country, Dubai and Doha for instance.
This is part of the reason why New Delhi has been playing hardball with the Gulf countries, particularly the United Arab Emirates, on the issue of bilateral air traffic rights and has not been heeding their calls for expansion of traffic rights. The UAE and Dubai-based carrier Emirates have been urging India to increase seats under the India-Dubai bilateral air services agreement beyond the limit of around 66,000 seats per week per direction, the Indian government appears to be unwilling to lend an ear.
The reason is clear. India wants its carriers to ramp up wide-body operations, instead of facilitating foreign airlines, particularly Gulf-based carriers with deep pockets, in ferrying passengers to Europe and beyond via their large hubs. Put simply, increasing seats under bilateral pacts does not sit well with India’s grand aviation ambitions.
In June, Emirates President Tim Clarke had again pitched for open access to the Indian market, reportedly saying that restrictive bilateral flying rights did not make sense for India if it has aspirations to become a global aviation player. The India-Dubai bilateral air services agreement has not been revised in over a decade.
