India-UK fares up 57% this summer

New Delhi: While the theme of the ‘India Now’ campaign, hosted by the ministry of tourism in London says ‘India is closer than you think’, the airfares reveal the other side of the story.
Airfares for India-UK sector increased by around 57% in summer (May-July) this year as compared to corresponding period last year. While the airlines are relieved that there were no ‘price wars’ this year, passengers had to shell out extra bucks.
In 2006, airfares on this sector had fallen 21% while 2007 again witnessed an increase in fares. The reason being capacity. Around 1,30,000 seats were added in this sector, out of a total of 4,50,000 seats added on international routes from India in June 2006.
Travel heads believe that besides capacity addition on the route, fares dipped last year also due to bmi’s (British Midland Airways) price strategy.
From Delhi and Mumbai airports maximum number of direct flights are to Dubai, followed by London. For airlines, the route is important as London is a transit hub. Besides, it also attracts leisure and student traffic.
The increase in capacity and the price wars have resulted in plummeting profits in the past three years.
02/08/07 Vishakha Talreja & Dheeraj Tiwari/Economic Times

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Categories: Foreign Aug 2007