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OUR INFRASTRUCTURE BUREAU
MUMBAI, Sept 19: British Airways is thinking big on India and is keen on doubling capacity, increasing frequency and introducing more destinations. The company plans to serve more routes and operate small aircraft on those with low capacity requirement, according to British Airways general manager (South Asia) Kevin Steele.
This, however, is possible only if the Indian government gives it the go-ahead as nothing has been finalised despite a long pending request from the airline. "We consider India as a potential country for expansion," Steele said. On price cutting during certain seasons which has spawned price wars, Steele said, "Fares are based on demand and supply situation." It is perfectly alright to woo passengers by giving them discounts, he said, as they would eventually benefit. Addressing a conference here on `trends in international aviation', Steele said that under the present competitive environment of globalisation, the industry was undergoing several changes. A detailed review was alsoessential due to currency devaluation in some parts of the world.
There will be several tie-ups and strategic alliances in the near future, he said. After a few years, 70-80 per cent of world traffic will be carried by five or six mega alliances, Steele added. Based on the `hub and spoke' strategy there will be smaller alliances to serve various `spokes,' he said.Besides, there will be some airlines who will make a niche in serving secondary airports and special segments of passengers. "The national carriers will also be able to compete if the government provides the subsidy for operating on less profitable routes," Steele said.
The industry will also see changes in others areas with a noticeable shift in manufacturing and procurement centres. "On the flip side, countries which face major currency depreciation have become attractive for foreign investment in manufacturing and other service areas," he said.
In this respect, Steele said that India has to compete with other east Asian countries ascurrencies have fallen much more than the Indian rupee.
Besides, these countries are more open to foreign investments. India does have an advantage of language in that more people speak English, but has to be more clear in its policies. It has to resolve political and economical problems and implement policies quickly.
When asked if British Airways would be interested in picking up equity in Air-India after the proposed disinvestment, Steele said, "We will look into the proposal." As per its present performance, AI will have to do some hard sell, he added.
Meanwhile, Steele confirmed that the Disinvestment Commission is holding talks with British Airways on divestment plans for AI given the former's successful privatisation and growth. Steele also reiterated that British Airways has no plans to get into the domestic airline business in India.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
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This story was printed from Net Express located at http://www.expressindia.com. Net Express provides a portal to India, with news from The Indian Express and The Financial Express along with sites on travel and tourism, the entertainment industry, the power sector, the environment and much more.
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