The Crossbill News Desk
A widening rift has emerged within India’s aviation sector over whether the country should throw open more international flying rights to foreign carriers, with Adani Airports Holdings Ltd pushing for greater liberalisation even as leading domestic airlines caution against it.
According to a report in The Economic Times, the Adani Group, which operates eight airports across the country, has urged the Union government to expand bilateral flying rights with several countries, including the United Arab Emirates, Saudi Arabia, Qatar, Singapore, Indonesia and Malaysia.
This position runs counter to the views expressed by India’s two largest airlines, Air India and IndiGo, which have warned that allowing more overseas carriers into Indian skies could expose domestic airlines to “unfair competition” from cash-rich West Asian operators. Air India, in particular, has argued that premature liberalisation could undermine Indian carriers that are still building capacity.
The Economic Times reported, citing documents it had accessed, that the Adani Group told the government last month that increasing international capacity would help Mumbai emerge as a global aviation hub.
The group plans to invest $11.1 billion by 2030 in terminals, runways, aircraft handling facilities and passenger amenities, according to Jeet Adani, director of Adani Airport Holdings.
An unnamed Adani Group official was quoted as saying, “Increasing access and options for passengers is a crucial aspect of transforming Indian airports into global hubs, and that should not just depend on when Indian airlines are ready to compete.”
The same official also described restrictions on international flying rights as a “criminal waste of assets” being built by airport operators, adding that limiting capacity amounted to “penalising” Indian customers who would end up paying higher fares because of fewer flight options.
Under India’s National Civil Aviation Policy of 2016, overseas airlines are not granted additional flying rights unless Indian carriers have used at least 80% of their allocated capacity on a given route.
As a result, The ET report noted, foreign airlines have been unable to add flights despite a sharp rise in demand, contributing to higher ticket prices.
The report said India’s “reluctance” to expand international flying rights stems from concerns that passengers could migrate in large numbers to Gulf airlines, which operate large fleets and can route travellers to Europe and North America through hubs such as Dubai, Abu Dhabi and Doha.
Air India CEO Campbell Wilson was quoted as saying that for many overseas carriers, more than 70% of the traffic they carry from India is transit traffic bound for other destinations. He reportedly said it was therefore in “India’s interests to make sure the pace of liberalisation is such that it doesn’t undercut investments being made by Indian entities.”
The ET report added that the current policy also hurts private airport operators such as the Adani Group, which have invested heavily in new terminals and runways but see lower returns because Indian airlines like Air India and IndiGo do not yet have “aggressive” expansion plans to fill the additional capacity.
According to a report in The Economic Times, the Adani Group, which operates eight airports across the country, has urged the Union government to expand bilateral flying rights with several countries, including the United Arab Emirates, Saudi Arabia, Qatar, Singapore, Indonesia and Malaysia.
This position runs counter to the views expressed by India’s two largest airlines, Air India and IndiGo, which have warned that allowing more overseas carriers into Indian skies could expose domestic airlines to “unfair competition” from cash-rich West Asian operators. Air India, in particular, has argued that premature liberalisation could undermine Indian carriers that are still building capacity.
The Economic Times reported, citing documents it had accessed, that the Adani Group told the government last month that increasing international capacity would help Mumbai emerge as a global aviation hub.
The group plans to invest $11.1 billion by 2030 in terminals, runways, aircraft handling facilities and passenger amenities, according to Jeet Adani, director of Adani Airport Holdings.
An unnamed Adani Group official was quoted as saying, “Increasing access and options for passengers is a crucial aspect of transforming Indian airports into global hubs, and that should not just depend on when Indian airlines are ready to compete.”
The same official also described restrictions on international flying rights as a “criminal waste of assets” being built by airport operators, adding that limiting capacity amounted to “penalising” Indian customers who would end up paying higher fares because of fewer flight options.
Under India’s National Civil Aviation Policy of 2016, overseas airlines are not granted additional flying rights unless Indian carriers have used at least 80% of their allocated capacity on a given route.
As a result, The ET report noted, foreign airlines have been unable to add flights despite a sharp rise in demand, contributing to higher ticket prices.
The report said India’s “reluctance” to expand international flying rights stems from concerns that passengers could migrate in large numbers to Gulf airlines, which operate large fleets and can route travellers to Europe and North America through hubs such as Dubai, Abu Dhabi and Doha.
Air India CEO Campbell Wilson was quoted as saying that for many overseas carriers, more than 70% of the traffic they carry from India is transit traffic bound for other destinations. He reportedly said it was therefore in “India’s interests to make sure the pace of liberalisation is such that it doesn’t undercut investments being made by Indian entities.”
The ET report added that the current policy also hurts private airport operators such as the Adani Group, which have invested heavily in new terminals and runways but see lower returns because Indian airlines like Air India and IndiGo do not yet have “aggressive” expansion plans to fill the additional capacity.
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