While the Comptroller and Auditor General (CAG) has raised concern over the extant government policy helping foreign airlines capture higher market share on lucrative sectors to and from India, the civil aviation ministry seems to be content with the status quo.

The ministry has been holding local private carriers Jet Airways, IndiGo, SpiceJet and Kingfisher Airlines from operating around 50,000 seats on international routes. The ministry’s policy, at the behest of state-owned Air India, has resulted in lower utilisation of traffic entitlements by the local carriers on routes like India-Dubai. On the India-Gulf sectors alone, the private carriers? plan to operate over 21,000 seats a week is awaiting the ministry?s approval since early this year.

Bigger foreign carriers like Emirates have made most of the delay in regulatory clearance to their Indian counterparts. On India-Dubai sector, designated carriers of Dubai are utilising 98% of the available traffic rights as against 46% by Indian carriers.

The Centre for Asia Pacific Aviation India head Kapil Kaul said the government?s policy to delay the private carriers? plan to operate additional services on foreign routes could force the airlines to deploy capacity on domestic routes.

?Domestic carriers are already bleeding due to low airfares. In case the government does not allow them to operate capacity on international routes they would be left with no option but to deploy the airplanes on domestic routes. This would cause excess capacity locally and hence a demand-supply mismatch which would hurt the entire industry,? Kaul said.

A top executive of a private airline agreed to the argument saying the observation was logical. ?Our application to operate services on several international routes is pending with the aviation ministry since March,? he said adding that even the government cleared their proposal today it would delay the winter schedule by at least three months.

The airlines have to secure the regulatory clearances from foreign aviation authorities following the permission from Indian government. It generally takes 3-4 months to complete formalities after the aviation ministry approves the proposal to operate flights internationally.

Among the Indian carriers which had applied for major international expansion are Jet Airways and IndiGo. Both the carriers together had sought government permission to operate nearly 25,000 seats a week on India-Gulf sector from the coming winter schedule. Jet Airways has also asked for government nod to fly to Paris from Delhi and Mumbai.

As per government data, out of the total bilateral traffic rights Indian carriers utilise only 23% against 37% used by foreign carriers.