Industry strife to benefit foreign airlines

New Delhi: The current impasse over relaxation of rules for more Indian carriers to fly abroad may eventually benefit foreign carriers flying in and out of India. The rivalry between private carriers — namely Jet Airways and the Kingfisher-Air Deccan combo — may give national carrier Air India a fresh lease of life in the lucrative Middle East market. As a result, the share of private Indian carriers in the out-of-India market — currently pegged at just around 30% — may not grow on anticipated lines.
It is still early days for the group of ministers (GoM) set up to deliberate on the pros and cons of the policy guideline that mandates private carriers to operate in domestic routes for five years before allowing them to fly abroad.
Corporate rivalries have reached such a level in the airline industry that the Kingfisher-Air Deccan camp is pushing government not to relax the Gulf route till the time a call is taken by GoM on the issue of the five-year norm. The idea is not to give Jet Airways undue advantage. Jet Airways, on the other hand, is wooing Air India for an alliance on the international routes.
This, in effect, means that foreign carriers would continue to call shots for some more time in the fast-growing market of international routes, even as the government and domestic carriers try to untangle the mess they have created for themselves.
07/09/07 Sudipto Dey/Economic Times

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Categories: Foreign Sep 2007, General Aviation Sep 2007