Saturday, July 06, 2013

Jet-Etihad deal: Handing over benefits to Abu Dhabi on a platter

There are 25,000 seats per week vacated by the defunct Kingfisher. The additional weekly seat entitlement of 40,000 by India would only help Etihad whose sole aim is to establish Abu Dhabi as a hub at the cost of Indian airports
The deal between India's Jet Airways and Abu Dhabi-based Etihad Airways has several angles. However, one point that stands out is how the deal was ‘facilitated’ to provide benefit to both the private parties at the cost of India. Especially, signing of the bilateral for enhancing weekly seat entitlement to 40,000 seats between India and Abu Dhabi is turning out to be more beneficial to Etihad than anyone else.
Basically, the bilateral covers only Third and Fourth Freedom Rights (as provided in the Convention on International Civil Aviation or Chicago Convention). However, the deal between Jet and Etihad is based more on the Fifth and Sixth Freedom Rights and the bilateral appears to facilitate this. More about the Freedom Rights later.
 The Indian government has literally given Jet and Etihad the right to pick up passengers from any domestic airport to Abu Dhabi. From here, the passengers would be flown to destinations beyond United Arab Emirates (UAE) like London and New York.
04/07/13 Moneylife
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