1. Bilaterals with Emirates: 4 into 1 pact possible only after nod from UAE, says Ashok Gajapathi Raju

Bilaterals with Emirates: 4 into 1 pact possible only after nod from UAE, says Ashok Gajapathi Raju

The proposal to club the flying rights given to four separate Emirates — Dubai, Abu Dhabi, Sharjah and Ras-Al-Khaimah — in a single pact can only be formalised if the UAE agrees to it, civil aviation minister Ashok Gajapathi Raju said. In an interview with FE, the minister said bilaterals need to be discussed bilaterally […]

By: | New Delhi | Published: May 22, 2017 6:20 AM
Civil aviation minister Ashok Gajapathi Raju (PTI)

The proposal to club the flying rights given to four separate Emirates — Dubai, Abu Dhabi, Sharjah and Ras-Al-Khaimah — in a single pact can only be formalised if the UAE agrees to it, civil aviation minister Ashok Gajapathi Raju said. In an interview with FE, the minister said bilaterals need to be discussed bilaterally and cannot be done unilaterally, so it can only be done after the discussions and UAE’s approval. Currently, there are separate bilaterals with Dubai, Abu Dhabi, Sharjah and Ras-Al-Khaimah.

“I don’t know about the historical background because in other cases also it was from country to country. So, I have no idea why the decision was taken to have separate agreements with four states. If that country is serious about it and wants it changed then we would not say that we are closed. As of now, there has not been any communication from the other side and is in the realm of speculation. If the desire is there then there is no problem, we can sit and negotiate,” Raju said. “If airlines on both sides have utilised 80% of the seats then the aviation ministry can negotiate for a revision, which is the case with the UAE,” he added.

The thinking in the ministry is that the move would benefit domestic carriers flying on international routes as well as the carriers in the UAE also.

The benefit with such a clubbing would be that an Indian carrier would be able to fly to those centres also where its seat deployments is full if deployment at other centres has capacity. For instance, currently the deployment of seats for Dubai is 65,200 which is full from both the sides. Any new Indian carrier therefore cannot fly to Dubai.

However, of the total seat deployment of 17,841 for Sharjah, while the UAE seats are full, Indian carriers have utilised only 13,674 seats. If the new proposal sails through, Indian carriers can use the balance 4,167 seats to fly to Dubai. Similarly, carriers from the UAE can also use such flexibility.

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However, industry sources said that the problem the new proposal would counter is that Indian carriers may face difficulty in getting slots in busy airports like Dubai.

As is known, the Indo-Gulf routes are amongst the most profitable.

Carriers from India and the UAE can now fly a total of 134,441 aircraft seats a week, each way. These are divided between Dubai (65,200), Abu Dhabi (50,000), Sharjah (17,841) and Ras-Al-Khaimah (1,400). Currently, Indian carriers are flying 97,802 seats, while the balance 36,639 are not being utilised because some centres don’t have the requisite traffic. Under this proposal, the balance seats can be deployed on routes where there’s more traffic.

According to Amber Dubey, partner and India head of aerospace and defence at global consultancy KPMG, “UAE is the only country where we have bilateral agreements with individual states. It’s like a foreign country having separate agreements with Delhi, Maharashtra and Tamil Nadu. It has to end. It may not help much in case of Dubai since there are not too many slots available at the airport there. Indian carriers may have to use Dubai’s second airport at Jebel Ali for additional flights”.

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