Saturday, November 28, 2015

More Emirates flights into India to boost economy but hurt local airlines

Mumbai: Expanding flying rights for UAE airlines into India could help to boost the subcontinent’s economy, but the move would come at the expense of the ailing state carrier Air India, analysts say.

A report by India’s National Council of Applied Economic Research (NCAER), released on Thursday, highlighted that Emirates has an economic impact of $848.6 million on India’s economy, and that with a greater allocation of seats the airline would generate further jobs, tourists and foreign exchange earnings.

This comes as Arabian Gulf airlines face pressure in Europe and the United States as their competitors in those markets try to get governments to restrict their market access.

“It is only right that the Indian government facilitate Emirates’ growth in the country, which would not only boost direct employment but also expand the GDP contribution for the country as well,” said Saj Ahmad, the chief analyst at StrategicAero Research.

“In fact, it should apply to all UAE airlines. Carriers like flydubai have been hampered in their growth in India because the government is reluctant to offer up additional capacity, when its own Indian-based airlines fail to fill the void.”

He said that “Emirates and other GCC airlines won’t face the same regulatory pressure as seen in the US and Europe” because those are “mature” markets compared to India’s “highly immature aviation market”.
28/11/15 Rebecca Bundhun/The National
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