For years, the major Gulf carriers have been the de facto national airlines of India, given the amount of global traffic that they carry to and from India via their hubs. With Indian airlines undergoing a major transformation, Indian authorities are now restricting the growth of these airlines, as reported by Reuters.
In this post:
India restricts foreign air access to the country
Airlines from the United Arab Emirates have the most foreign access to the Indian aviation market. India and the UAE have a bilateral agreement, which caps the number of seats that airlines from the UAE (like Emirates and Etihad) can operate to India. More specifically, the cap applies to each emirate, so there’s a separate allocation for Abu Dhabi, Dubai, Sharjah, etc.
As you’d expect, airlines like Emirates constantly want to increase service to India, as demand from India makes up a large portion of the Dubai-based carrier’s passenger base.
Well, India’s Minister of Civil Aviation, Jyotiraditya Scindia, has this week stated that he is not looking to increase passenger quotas with Gulf states, but rather is requesting that Indian airlines increase their international service.
With Air India now having been privatized, and placing one of the largest aircraft orders in history, Scindia sees this as the ideal opportunity for India to recapture international passenger demand. As Scindia explains:
“Today my hubs are in either the eastern border of my country or the western border of my country. With the scale that I have, I must create a hub within India.”
“Earlier, airports and airplanes would only go to those cities that presented a great economic growth story to make the rationale for that investment. Today, it is airports and airlines that are determining economic growth. That whole paradigm has changed.”
Will India’s strategy work?
India is the second most populous country in the world, with over 1.3 billion people. It’s a massive aviation market that keeps getting larger. Yet historically Indiann airlines have only really thrived in the domestic market, where foreign airlines can’t compete.
When it comes to bilateral aviation agreements, some countries have Open Skies policies, whereby there are no limits on how much service airlines can add between countries, assuming they can secure slots with airports. The bilateral agreements between Gulf countries and India have generally been capacity controlled, since India wants to ensure the market won’t get too flooded.
Even as demand grows, we’re now seeing India essentially say “no more” when it comes to Gulf airlines adding capacity:
- I can appreciate that Air India is promising to completely overhaul itself and grow, but that won’t happen overnight; it’ll be years before the airline adds significant capacity, and creates a product that’s consistently competitive
- If Indian airlines improve to the point that they’re competitive with Gulf carriers, then there shouldn’t even be a need to artificially restrict access to the country, as consumers should be willing to choose Indian airlines based on schedule, product, pricing, etc.
- While I can appreciate the desire to promote Indian airlines, restricting capacity ultimately leads to higher fares and less consumer choice
I don’t think the Indian authorities are wrong with their approach in wanting to ensure that there’s a robust network of Indian airlines, though I also think it’s worth acknowledging that the current reality of Indian airlines is very different than what’s being promised a few years down the road.
For example, Air India’s current premium cabin product is uncompetitive. The airline is investing in new cabins, though based on current plans, the first plane won’t be reconfigured until mid-2024.
India will likely be the most interesting aviation market in the world to follow over the coming years.
Bottom line
India’s aviation minister has made it clear that he’s not entertaining additional capacity requests from Gulf countries, as he instead wants domestic airlines to expand internationally and carry passengers. I can of course appreciate how it’s beneficial for Indian airlines to expand domestic market share, and how Air India is promising major improvements and capacity additions.
However, it will be quite some time before Indian carriers are actually competitive internationally.
What do you make of India not increasing capacity caps for Gulf airlines?
Frankly, entire Air India staff are substandard. No body want to serve the customer with professional manners even inflight service worse than Indian railway and dirty .
Not only that their sixth freedom traffic rights should be cancelled can the Govt. do it.
Gulf carriers grab business from all countries of Indian Subcontinent in a very unethical way and their business never clean like other asian giant SQ. Major US carriers crying for decades to do ethical business by EK and QR. But these carriers can also manage US administration. But US carriers can restricts to get traffic right into US gateway points as like Canada. Why not India, Bangladesh, Pakistan can restrict their traffic rights? These gulf...
Gulf carriers grab business from all countries of Indian Subcontinent in a very unethical way and their business never clean like other asian giant SQ. Major US carriers crying for decades to do ethical business by EK and QR. But these carriers can also manage US administration. But US carriers can restricts to get traffic right into US gateway points as like Canada. Why not India, Bangladesh, Pakistan can restrict their traffic rights? These gulf airlines are not cheaper airlines.
Being in aviation for many decades I feel that Indians are known to quickly finding solution using Jugad technology to fight higher ticket price. For example why would any passenger take direct flight from Delhi to New York at higher price when can easily get cheaper flights to New York with even better facilities from Dubai, Srilanka, Oman etc. and that too at much lower rates. People will find 10 ways of Jugard and booking...
Being in aviation for many decades I feel that Indians are known to quickly finding solution using Jugad technology to fight higher ticket price. For example why would any passenger take direct flight from Delhi to New York at higher price when can easily get cheaper flights to New York with even better facilities from Dubai, Srilanka, Oman etc. and that too at much lower rates. People will find 10 ways of Jugard and booking agents will benefit most as will get maximum commission either from Air India or their competitors. Then passengers will have Achay Din as may get some freebies too.
Foreign carriers especially from the Gulf states have had a field day in these years when AI was being totally mismanaged. Thus they grew to be giants carrying bulk of the passenger load from and to India from anywhere. They have been charging excessive fares in the absence of a viable national carrier. The present government is trying to regain that space. Let Emirates and the likes compete on a fair basis and win if...
Foreign carriers especially from the Gulf states have had a field day in these years when AI was being totally mismanaged. Thus they grew to be giants carrying bulk of the passenger load from and to India from anywhere. They have been charging excessive fares in the absence of a viable national carrier. The present government is trying to regain that space. Let Emirates and the likes compete on a fair basis and win if they genuinely have a better proposal. Why all this hoo haa?
It is not because of mismanagement of Air India but work of Politicians like the Aviation Minister in the UPA Govt. and also with the support of Naresh Goyal of defunct Jet Airways.
India is not restricting. Earlier under tge corrupt congress govt rule, a lot of additional capacity was given to emirates and Qatar airways, in exchange for bribe.
The current Bjp govt under Modiji is trying to set it right snd being fair to airlines of Indian origin.
Every country in the world does protect its airline and industry first.
Trying to set it right after 9 years.withdraw their sixth freedom traffic also.
Good but if middle east countries tell leave all indoan as eaely as possible.....than!
Ben - One thing that could be an interesting variable in all this is the 'leasing'. AI seems to look beyond their record order to plug the gap of supply and demand in the near term. See example below. If it's true, I would imagine there's a lot more competition coming to the ME3 even before the new planes are delivered.
https://simpleflying.com/air-india-airbus-a350s-aeroflot-cabins/
Hi, to all experts on this forum. The time has come for India to reclaim the skies. With the TATA GROUP purchasing their own airline from the Indian Government- the scenario is gonna change. They've roped in Campbell Wilson to deliver his best and things seem to be moving in the right direction. With the recent order of 470 planes and another 330 on leasing options- a lot of jobs, employment and airport constructions are...
Hi, to all experts on this forum. The time has come for India to reclaim the skies. With the TATA GROUP purchasing their own airline from the Indian Government- the scenario is gonna change. They've roped in Campbell Wilson to deliver his best and things seem to be moving in the right direction. With the recent order of 470 planes and another 330 on leasing options- a lot of jobs, employment and airport constructions are underway. All the best to my ex- employers. Make India Great Again.
Restricting competition is never a good idea. While it is appreciated that local airlines need to grow, it must be balanced by the needs of the consumers. Overprotective environment only leads to protected airlines offering below par service, as witnessed by many countries.
In turn demand will be more supply will be less eventually passengers will end up by paying more. Simple mathematics!
Protectionism is never good for us.
Instead of giving trouble to passengers by blocking the other country airlines. Just improve the services and give the good flights with good services like the other country airlines provide. Every indian will prefer to travel in our own country airlines, why we will opt for other airlines if you provide the good services.
I would somewhat agree if indian airlines price is reasonable. Airindia charges very high prices when school vacations. Also so crowded, poor service. I prefer we should have more airlines to fly india.
Do you think Emirates offers cheapest fare on the Globe?
Any effort to strengthen & promote indigeneous products & services in domestic and foreign markets is a most welcome move in accordance with 'Make in lndia, make for the World' slogan. This can surely create more jobs in aviation industry for the locals and contribute to GDP. Furthermore, national carriers fly a countries image high to various destinations & this also promote the country itself. Meanwhile, lndia also can focus on commercial airlines beside passengers...
Any effort to strengthen & promote indigeneous products & services in domestic and foreign markets is a most welcome move in accordance with 'Make in lndia, make for the World' slogan. This can surely create more jobs in aviation industry for the locals and contribute to GDP. Furthermore, national carriers fly a countries image high to various destinations & this also promote the country itself. Meanwhile, lndia also can focus on commercial airlines beside passengers as this will also another market segment that can be explored & concurred for a sizeable share.
It is right on part of Indian Civil Aviation minister to take care of Indian National carriers but the main question is are these airlines geared up to compete with Gulf airlines who have been the top 10 airlines in the world from last so many years. Competition is good for all consumers but it will take long time for Indian carriers to match their services with Gulf carriers.
Why, was not AI on top ever!!!
Can the Indian airlines really compete with M3? This strategy is certainly unhealthy according to me
Ok fine u restrict gulf careers expending in India, are u really capable of giving a good service better then theirs?
Well right now travelers are forced to use non Indian overpriced carriers so it's hard to see how things could get worse
Air Canada has the worst on time performance in NA and yet the Gov't still keeps protecting it from real competition!
We need to give daily access to all our airports the M3 ASAP.
Plus terrible baggage handling from what I hear
Very simple solution to this. Just threaten to send ALL the Indian expatriates back to India, India will change the Tune.
Good luck convincing any government to do that with the current dependency
Never overestimate!
And watch the local economy which is run by Indians collapse? And lose market access to the second largest population base in the world?
Because they won't give you unrestricted access to *their* country?
Remember that even right now India is among their biggest and most profitable markets. You are talking about losing that because India won't give even more.
Fantasy world.
This argument always amazes me. A country stands to gain much much more with net immigration inflow compared to a country that exports it. This is a small mind thinking - uae has indian workers coming in because the country needs it. Human capital is the most important resource for a nation to develop - and cities like Dubai rely on this capital. With jobs moving to India, countries should exactly do the opposite -...
This argument always amazes me. A country stands to gain much much more with net immigration inflow compared to a country that exports it. This is a small mind thinking - uae has indian workers coming in because the country needs it. Human capital is the most important resource for a nation to develop - and cities like Dubai rely on this capital. With jobs moving to India, countries should exactly do the opposite - try to make it more attractive for workers to keep coming.
Why they don't need people there. If they despatch expatriates who will later travel on their flights.
Ben - it's starting to get a bit tiring of you dumping on Air India. Since Tata took over, both hard and soft international products have improved drastically. It's totally disingenuous to post a picture of an old 777 Air India business class at this point. Most long haul routes are on their newer 787 Dreamliners including nonstops to USA, Australia and Europe. It's not the hard product of QSuites but it's certainly better than...
Ben - it's starting to get a bit tiring of you dumping on Air India. Since Tata took over, both hard and soft international products have improved drastically. It's totally disingenuous to post a picture of an old 777 Air India business class at this point. Most long haul routes are on their newer 787 Dreamliners including nonstops to USA, Australia and Europe. It's not the hard product of QSuites but it's certainly better than even emirates 777 2-3-2 business on long hauls.
Air India is poised to swallow the huge volume of ex-India pax flow to USA from ME3 and Euro connections over the next couple years. Mark my words, the product, service and price will be hard to compete against.
While I respect you as a travel blogger, please think one moment before posting unnecessarily racist and defamatory articles unless you have flown it recently.
I know you are a Lufthansa fan boy but if Tata can beat Europe and ME3 at getting pax to USA etc over the next 2 years, I expect you to write a proper article of vindication.
I grew up flying in the worst conditions of long haul AI btw USA and India (via LHR). Those days are over and a burgeoning new product deserves a fair review from esteemed bloggers like yourself. Stop using your privilege to dissuade large groups of flyers from trying a new product for flying to India based on long held (and previously correct) biases. You are better than this.
I suggest anyone who disagrees to please take a long haul AI flight and prove me wrong.
On the contrary I don't think it's racist to point out the reality. Articles are not written based on future potential, just the current situation. Tatas buying Air India is not a magic bullet, there's A Lot of things that needs to change to make Air india competitive, the first of it being the mentality of the staff and customer service execs that still treat this as a government job. I have had bad experiences...
On the contrary I don't think it's racist to point out the reality. Articles are not written based on future potential, just the current situation. Tatas buying Air India is not a magic bullet, there's A Lot of things that needs to change to make Air india competitive, the first of it being the mentality of the staff and customer service execs that still treat this as a government job. I have had bad experiences even after the Tata acquisition where it's impossible to talk to CS person and have lost money on a round trip cancelled fare because Air india just ignored all my cancelation requests. This is not how a airline with global aspirations should operate. It'll take a lot more a lot faster from Air india to make me travel with them again.
Good move for carriers based in India, they have a chance to grow internationally with smart point to point nonstop service. Bad move for the Indian consumer as the demand far exceeds the supply presently and right or wrong additionally seats to the vibrant global market, helps keep fares in check.
Beyond Indigo which is super product economy only, no Indian carrier can compete with the M3 presently on service, reliability, at the same time...
Good move for carriers based in India, they have a chance to grow internationally with smart point to point nonstop service. Bad move for the Indian consumer as the demand far exceeds the supply presently and right or wrong additionally seats to the vibrant global market, helps keep fares in check.
Beyond Indigo which is super product economy only, no Indian carrier can compete with the M3 presently on service, reliability, at the same time they cater to a different audience from second tier cities. So, allow competition to prevail.
Very good news indeed,they things only 3 airlines in the world Emirates,fly Dubai an Etihad Airways,Pakistan should fallow Indian Aviation can control Turkish airlines as well
Luv from Pakistani
Sure. How about you start sorting out your pilots first?
This is just one side of the story. Gulf airports are not allowing prime slots for Indian carriers. Unless they resolve that, there will be stalemate.
India should do well.Killing the competition to win is not the way.This will make , AirIndia which already has a bad reputation in the customer care department ,worse as they will be gaining advantage without deserving it.
Absolutely right, I haven't considered AI for the last 40 years, and I never Will
And I have flown Air India more than 40 years ago and it was awesome.
And then the Indian government took it over and it turned to garbage like everything they touch.
Well, it's unshackled again and I know it will take time but I think it could rule the Indian skies again and restore JRDs dream.
Yes current service sucks because of quotas and favorites and whatever. But remember they are partnered...
And I have flown Air India more than 40 years ago and it was awesome.
And then the Indian government took it over and it turned to garbage like everything they touch.
Well, it's unshackled again and I know it will take time but I think it could rule the Indian skies again and restore JRDs dream.
Yes current service sucks because of quotas and favorites and whatever. But remember they are partnered with SIA which has one of the best service records in the world.
Keep an open mind
Don't consider. AI will not become poorer.
Had they gave this support to AI before it's privatisation, it would have been a great deal.. Now Govt want to support the private companies..
“Yet historically Indiann airlines have only really thrived in the domestic market, where foreign airlines can’t compete.”
That would be Indian not Indiann
Air lndia just announced that they have to cut back on flights to and from the US because they don't have enough staff.
Article below from HM Hindustan times.
Air India may slash flights amid crew shortage
By
Neha LM Tripathi
Mar 21, 2023 10:00 AM IST
Passengers flying to the US on Air India may see cancellations during the peak summer travel season as a crew shortage forces the flag carrier to trim popular flights to the country, officials said on Monday.
How is this any different from US carriers wanting to ban all airlines that overfly Russia because they did not pick a fight with that country? Sounds like double standards...
Good comment. Albeit,
just because USA does it, it does not make it right.
India wants to limit flights by the Middle East carriers TO INDIA ONLY. The airlines in the Exceptional Empire want to eliminate overflights by any other airlines flying anywhere in the world using Russian airspace just because US airlines have chosen to obey their political masters. Can you see the difference? Or you are so brainwashed that even the obvious escapes you?
I thought the US only wants to stop Russia overflying for all airlines on flights to the US.
Agreed, and that's bad enough, but guaranteed a global boycott will be the next demand. To paraphrase India's Foreign Minister Jaishankar: the world's problems are not the West's problem but the West's problems are the world's problem.
The airlines in the Exceptional Empire want to eliminate overflights by any other airlines flying anywhere in the world using Russian airspace just because US airlines have chosen to obey their political masters. Can you see the difference?
No, and apparently, neither can you... seeing as that's not at all what those carriers requested.
You cannot see difference because you are terminally brainwashed. Go sit in a corner.
Good for India! The Gulf carriers actually keep prices higher than average. These are state/family owned with limitless cash to put into their product. Yes, protect India from the Gulf carriers strangle hold on International flights. Most of the people traveling to & from India are working in the respective countries construction & service industries.
We are ready to fly in Indian airlines but they wll depart on time?? that's only things to think before to choose Indian airlines...
Almost 3 to 4 flights having technical glitch every month..
India a country that only says yes to Russia. Cannot be trusted as a global citizen.
Don't fly them then. No one asked you to.
Therefore, your only 'trusted global citizens' are the slaves of the USA? I thought this kind of thinking was squelched in the 1860s.
^ Anyone else wondered how long it would take YinYanWhatever to show up as a pseudonym?
There is a lot of misreporting on this.
India has separate bilateral agreements with four different emirates of the UAE - namely Abu Dhabi, Dubai, Sharjah and Ras Al Khaimah. These bilaterals actually deal with number of weekly seats permitted for each side and the gateways they can be used to, rather than frequencies.
The bilaterals between India and Dubai are currently fully utilised by both sides.
Dubai is asking for an increase in...
There is a lot of misreporting on this.
India has separate bilateral agreements with four different emirates of the UAE - namely Abu Dhabi, Dubai, Sharjah and Ras Al Khaimah. These bilaterals actually deal with number of weekly seats permitted for each side and the gateways they can be used to, rather than frequencies.
The bilaterals between India and Dubai are currently fully utilised by both sides.
Dubai is asking for an increase in their allocation (ie. for Dubai airlines to fly more seats to India). However, due to slot constraints at DXB that would disproportionately benefit Emirates and flyDubai at the expense of the Indian carriers who control less slots there. Furthermore, Indian carriers have unutilised bilateral rights to Abu Dhabi, Sharjah and Ras Al Khaimah still available for growth.
Emirates or flyDubai can choose to be designated as airlines of Abu Dhabi, Sharjah or Ras Al Khaimah and fly from those airports to India - but of course they won't do that. They want access from Dubai only. But that's not compatible with either reciprocity or the interests of Indian carriers at this time.
@Sean
How do the bilaterals treat DXB vs DWC?
Are they viewed as interchangeable co-terminals, or could DWC be a back door, albeit an unwanted one?
@ConcordeBoy - The last update to the bilateral was before DWC opened. As of now, the only bilaterally approved point of call for Indian carriers in Dubai is DXB.
How will seats gets increased; through bigger equipment or more frequency. They also carry sixth freedom traffic from India which is not available to Indian Carriers. Govt should curb this too. Can they do it.
We did this is Canada over the last decade.
The result is AC gets to fly a crap product at high prices, competition free
Agreed. That’s why Canada charges the highest fares and destroys any competition plus they have no qualms with AC controlling the skies.
Good point; hopefully India will make the system work better. I recently flew business class AC from YYZ to Doha. Utterly unimpressive soft product. Fortunately, AC has canned those flights.
It's the reason why whenever I need to fly from California to Toronto or Montreal I fly to nyc or Boston and then connect to Canada at a 30-40% discount then flying AC direct. Plus,AC is just awful. I have never had anything better than an adequate flight with them and it's usually business class.
Agreed....protection tactics maybe?
That's why AC does what it wants. With fares kept astronomically high.
Air Canada has the worst on time performance in NA and yet the Gov't still keeps protecting it from real competition!
We need to give daily access to all our airports the M3 ASAP.
They have also said no to Turkey, Vietnam and Kuwait, only saying yes to Russia. The problem is demand is growing so much even if there are no limits and the markets become open skies, there will always be enough demand for Indian carriers. By not granting bilaterals now they just negatively harm consumers and create artificially high prices that really help no one.