India proposes Gulf bilaterals freeze
Originally published on www.businesstravellerme.com 13/09/2011 - Filed under: News »
The India Ministry of Civil Aviation (MoCA) is proposing freezing bilateral agreements with Gulf and other foreign airlines using routes for sixth freedom traffic.
Auditing report 18 states India is experiencing a treble hit with Air India "handicapped" by inadequate hubs, Gulf airlines expanding rapidly on its own doorstep and using the country as a conduit for sixth freedom traffic (the right to fly from a foreign country to another foreign country while stopping in one's own country).
Other concerns cited by MoCA include not obtaining firm and immediate commitments from Dubai for a change of gauge facility at Dubai Airport, which would "at least have provided an opportunity for Indian carriers to funnel traffic in smaller capacity aircraft from interior Indian locations" and connect onwards globally with larger aircraft.
A Dubai Airports spokesman said: "Bilateral arrangements are made by governments not airports and it would be inappropriate to comment on something that is within the government’s purview."
The bilateral freezing is one proposal aimed at helping Air India, which MoCA says is in a crisis situation following the "risky acquisition of larger aircraft, ill-timed merger undertaken after separate acquisitions by Air India and Indian Airlines, chronic operational deficiencies and weak financial position".
It also states Air India's failure to join the Star Alliance can be mainly attributed to the delay in setting up a single code passenger system.
Any freezing of bilateral agreements would be unwelcome by low-cost Indian carriers, which are now taking the commercial fight to the Gulf.
Low-cost airline IndiGo recently started flights between Delhi and Dubai and will launch flights between Mumbai and Dubai from October 2 (click here).
For more information, visit Supreme Audit Institution of India
Report by Dominic Ellis
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