Govt to review bilateral pacts as Indian carriers suffer

New Delhi: The government plans to review agreements it has in place with other countries on the number of international flights to and from India and also go slow in granting such rights in the future, according to senior government officials and foreign airline executives who are already facing delays in receiving new approvals.
The review of such permissions, also called bilateral rights or bilaterals, is seen as a reaction to the falling share of Indian carriers on international routes and the increasing dominance of foreign airlines. In peril are the ambitions of big Indian airports to turn into aviation hubs.
India has a so-called open skies agreement with countries such as the US that liberalized air travel. But the government negotiates with countries such as the UAE, Saudi Arabia, Singapore, Germany and the UK before granting their airlines the rights to fly to and from India.
The move to review bilaterals and go slow on granting fresh approvals, experts say, is likely to slow the plans of several international carriers, especially those from West Asia and South-East Asia that have hitherto benefited from New Delhi’s liberal approach in granting such rights. Most international airlines see India as potentially one of their strongest markets after a global economic downturn hit air travel in developed economies.
In the last four years, India’s aviation ministry has agreed to new bilateral rights for as many as 400,000 seats, taking the number of foreign flights to 706 a week from some 460 in 2005—a jump of nearly two-thirds.
While the benefits of such expansion on ticket prices are evident—it costs just Rs1,730 to fly from Tiruchirapalli in Tamil Nadu to Malaysia, including taxes—administrators point out that three in four of the new bilateral allocations made since 2005 have been cornered by foreign carriers.
02/08/09 Tarun Shukla/Livemint

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Categories: Foreign Aug 2009, Indian Aviation- In General Aug 2009