India wants to restrict Gulf flights to help Air India

[flyjet787]

India wants to restrict Gulf flights to help Air India

India's national auditor yesterday launched a scathing attack on Emirates Airline, recommending it and other Gulf airlines should be forced to reduce services to the subcontinent.
The comptroller and auditor general of India said in a report to parliament that Air India's business was being damaged by the freedom of Gulf carriers and that liberalisation in 2004 of air entitlements to foreign carriers "left much to be desired".
"Clearly, the Gulf sector was [Air India's] most profitable international segment before the liberalised policy on entitlements," the report said.
The Indian recommendation is the latest in a long line of disputes between the UAE and other countries over the dominance of Emirates and Etihad Airways.
Both Air Canada and Lufthansa have sought to restrict landing rights of UAE carriers in the past year. The Canadian dispute escalated into a full-blown diplomatic spat.
India is one of the largest markets for the UAE's carriers, helping to feed traffic into the long-haul networks of Emirates and Etihad as well as direct travel for the budget carriers flydubai, Air Arabia and RAK Airways.
James Hogan, the chief executive of Etihad, said India was an important market for the airline. "We have been operating their since 2004," he said. "Today we operate services to eight destinations in the country providing a vital route for travellers between India and our global network. We look forward to serving this market in the short, medium and long term."
India embarked on a deregulation process of the aviation market in 2004, which produced an average annual growth of 27 per cent until 2008, according to the Directorate General of Civil Aviation in India.


But the national auditor said yesterday the ministry of civil aviation had ignored "the interest of the Indian carriers including that of Air India" after allowing Middle East airlines to add flights.
The auditor said that until India had its own "effective and efficient" hubs and Air India and other carriers were able to "exploit them effectively", services for Gulf airlines should be restricted.
Emirates Airline declined to comment.
The Indian auditor's report said Air India had "repeatedly expressed strong reservations" to the aviation ministry against the proposals and requests from Gulf countries for an increase in seat entitlements, as well as additional points of call at interior locations in India.
The state-controlled carrier is losing 6 billion rupees (Dh477 million) a month, Vayalar Ravi, the minister for civil aviation, said last month.
The report added that freedom of access for foreign airlines, predominantly Emirates Airline, had led many to tap the vast Indian market and funnel traffic over hubs such as Dubai to various destinations in the US, the UK and elsewhere in Europe.

It may not be possible to cut Middle East carriers' rights because of diplomatic issues, the auditor conceded.
Carriers from Dubai provide more than double the amount of seats per week on routes between the emirate and India than Indian carriers.
Emirates flies 185 weekly flights to 10 destinations in India.
Both Ghaith Al Ghaith, the chief executive of flydubai, and Adel Ali, the chief executive of Air Arabia, recently made clear that the subcontinent was a key pillar of growth for their short-haul strategies.
Indian airlines that operate services into the UAE include Jet Airways, Air India, Air India Express and Kingfisher.India wants to restrict Gulf flights to help Air India - The National (http://www.thenational.ae/business/aviation/india-wants-to-restrict-gulf-flights-to-help-air-india)

This could be a huge blow to EK, EY and QR.

[kotakota]

Not sure it will impact the gulf carriers too much . I reckon it could signal the end of many jobs for Indian Nationals in the Gulf ? what goes around , comes around.
Blaming the Gulf carriers for Air Indias plight is a bit naive .

[InnocentBystander]

It's probably just them telephoning the gulf carriers to up the bribes... ;)

Air India wouldn't turn a profit if it were the only airline in India.

[Instant Hooligan]

I wonder what Air India's excuse is? Cannot get enough cheap labour to compete.....?? :ugh::ugh:
Cue Sheiky for a balanced response.....

[flyjet787]

Not sure it will impact the gulf carriers too muchEK thrives on Indian traffic. Not just on the India-Dubai sector but mostly onwards to Europe and North America.

I reckon it could signal the end of many jobs for Indian Nationals in the Gulf ? And where are they going to get the labor to undertake the massive constructions all over the Gulf region? Plus EK utilized almost its full quota of the bilateral rights where as the Indian carriers don't utilize even half of it. So I think further increase will only happen when ever both countries agree that they need to add more seats.

Blaming the Gulf carriers for Air Indias plight is a bit naive Gulf carriers have not been blamed anywhere. In fact its the Indian Civil Aviation Ministry especially the former Minister Praful Patel is the one who is being blamed. The number of seats per week allotted to EK were increased substantially from 18000+ to 54000+ within a few years and during this time AI had not received its new aircraft (not that it would have done significantly better with new aircraft) and more importantly no Pvt Indian carrier was allowed to fly to the Gulf countries and compete with the gulf carriers in the name of protecting AI.

The fact that the Govt gave away all the lucrative rights to EK etc. and that they literally had no competition itself is a clear indication that some of the Ministers benefited from this.

Frankly which country would want the foreign airlines to benefit at the expense of not just the Govt owned airline but also other Pvt Indian airlines.

You have seen Canada and Germany impose some restrictions and now its about time India did the same. Not just for the sake of AI but also for other Indian carriers.

[flyjet787]

Oh and by the way all this AI hype would probably exist only till the next scam is unearthed (which these days has become a common affair and shouldn't take long) then every one (the opposition parties, media etc.) will move on to that new topic and all this AI drama will be forgotten overnight. Nobody really expect the Govt to act on the CAG recommendations anyway.

Sad state of affairs in India.

[donpizmeov]

Well they do say that Indian law makers are the best money can buy.

[Dualinput]

Whatever the govt does, Air India will never churn out profits…..inefficiency at its best! Stopping competition wont help much….company needs a total revamp!

[Non Zero]

Air India like any other EU Major Airlines should focus on improving services to make profit! ... and hopefully it is not to late!

[shresht]

Only SLF here, but informal payments to public officials won't really work in India right now.

[The Turtle]

gotta love the Indians...they can't fix it themselves so they blame others



By Marilyn Gerlach and Peter Maushagen/Reuters
FRANKFURT

http://www.aviationweek.com/media/images/ca_images/Airlines/LufthansaA380NoseFRIEDL_LUFTHANSA.jpg India has refused to grant New Delhi landing rights for Lufthansa’s Airbus A380, a German daily said on Friday.
Frankfurter Allgemeine Zeitung newspaper reported in a pre-release of its Saturday edition that the Indian government’s decision apparently was made because the Star Alliance, of which Lufthansa is a member, had rejected Air India’s bid to become a Star Alliance member.
It said Star Alliance last month decided to turn down the request of state-owned Air India to become a member because of the latter’s weak financial situation.
The report said the denial of landing rights would be a blow to Lufthansa’s ambition to expand its flight offers to India.
A spokesman for Lufthansa said the landing rights issue should not be linked to Star Alliance’s decision on Air India, saying other airlines have also been unsuccessful so far in obtaining the right to land some of their aircraft in New Delhi.

[ironbutt57]

gotta love the Indians...they can't fix it themselves so they blame others


Same thing sort of with EK and Canada??

[flyjet787]

Germany/Lufthansa have done the same thing with Emirates.

Emirates responds to German accusations over landing slots - The National (http://www.thenational.ae/business/aviation/emirates-responds-to-german-accusations-over-landing-slots)

Lufthansa wants to block the Dubai carrier's bid because it believes the airline has an unfair advantage in its services between the two countries.
"We think there is a big imbalance in the allocation of slots," said Wolfgang Weber, a Lufthansa spokesman.
"Emirates already flies to four airports in Germany while we only fly to one destination in Dubai. They have between five and six times more business on that route as a result," he said.

Same situation between EK and other Indian carriers. EK serves twice the number of seats as compared to all Indian carriers combined.

[masalama]

Part of this action stems from the current distaste and backlash from the Indian public and media against corruption in India .
For those of you familiar with the anna hazare movement against corruption in India , the various scams and the CAG reports of kickbacks and favors to companies in awarding contracts, mining rights and the state of aviation and the national airline of India is causing heartburn for the government.

They have been arm-twisted into accepting the public accountability bill (jan lokpal) because of the large scale and unexpected protests from all parts of India. Reports of favoritism from previous civil aviation ministers to various foreign airlines and EK in particular while totally ignoring the local airlines have caused an uproar here in India. It was bound to happen , but, as usual in India , at a snail's pace.

Donpizmeov saidWell they do say that Indian law makers are the best money can buy.
Maybe true, Don but they're also learning very quickly that we're fed up. Three ex-ministers currently lodged in jail on various charges and many more to join. The Indian of today is well- informed , more aware of his/her rights and better off than ever before. A long way to go still but work in progress:ok:

For those who think that sending back millions of migrant workers back from these countries would force India to re-consider are grossly mistaken. Indians are terribly stubborn and can make some very illogical decisions as many have experienced.

I think it's good that airlines like EK have shown Indians how to do things efficiently and now we question the govt., why do you not let the local competent carriers do the same??? That's the beauty of democracy , we can question the actions of our elected representatives ,something that's sweeping across the arab world like wildfire.... you never know, there could be an elected govt. someday in the UAE as well or better yet, a pilot's union at EK :}

Watch this space , more action to come .masalama.