Aero-politics: Bubbles bypass painstakingly-crafted bilateral agreements; could soon see legal challenges

June 07, 2021 6:15 AM

Countries are now mandating health protocols that, in many cases, are going beyond the purview of aviation. They are also negotiating “bubble” arrangements that temporarily bypass bilateral agreements.

And if that wasn’t bad enough, there is the Belarus incident in which a flight was diverted mid-air and forced to land using a bomb-threat purportedly facilitated by the state. Overall, these elements point to a challenging and contentious era of aero-politics.And if that wasn’t bad enough, there is the Belarus incident in which a flight was diverted mid-air and forced to land using a bomb-threat purportedly facilitated by the state. Overall, these elements point to a challenging and contentious era of aero-politics.

By Satyendra Pandey

Aviation continues to be disproportionally impacted by the Covid-19 pandemic. Airline cash-flows are down to a trickle, and airports, once buzzing with activity, sit eerily silent for long stretches. Airlines alone are set to lose more than $50 billion in 2021, and air-travel demand will take a while to return. Concurrently, there is also another challenge looming: Air travel is witnessing complex asymmetric rules that speak to each country, to politics and to public opinion. Countries are now mandating health protocols that, in many cases, are going beyond the purview of aviation. They are also negotiating “bubble” arrangements that temporarily bypass bilateral agreements. Consequently, air travel that depends on collectively agreed, universally accepted and uniform standards faces a stormy ride. And if that wasn’t bad enough, there is the Belarus incident in which a flight was diverted mid-air and forced to land using a bomb-threat purportedly facilitated by the state. Overall, these elements point to a challenging and contentious era of aero-politics.

Aero-politics deals with the politics behind aviation. The two, namely aviation and politics, have always been intertwined as most airlines and airports historically were nationally-owned. Further, aviation has a tendency to generate headlines and influence the narrative. Throw in the impact on jobs, economic growth and taxes, and intense involvement by politicians and policymakers is a given.

The current challenge of aero-politics deals with market-access. That is, the ability of foreign airlines to fly into countries and pick up passengers. For countries that have a sizeable domestic market, these have been protected. But, for those like the UAE, Singapore and the UK, where the majority of the passenger flows is dependent on a strategy of accessing foreign markets and then using their airports as transfer hubs, the consequences of limited access are dire. For these countries, traffic-flows not only help sustain large airlines but also aid commerce, employment and economic growth. All of this is anchored on market access. Aero-politics behind market access stems from nations’ virus containment and elimination strategies. These are best reflected in varied arrival procedures, debates on which vaccines will be accepted, and a gradual march towards non-standard procedures. Bilateral agreements that once governed aviation are now temporarily being replaced by bubble arrangements (short-term arrangements between two countries towards facilitating easier movement). These help address the issue of testing and protocols by standardising it for two countries. It is perhaps the only short-term solution to restore reluctant passenger flows. But, bubble arrangements, by their very nature, are contentious, because they effectively bypass the bilateral treaties that were negotiated between two sovereign entities. And, it is only a matter of time before these see a legal challenge.

Finally, there is the Belarus incident where a commercial flight was forced to land using a bomb-threat facilitated by a sovereign state. Multiple stakeholders, including the International Civil Aviation Organization and the International Air Transport Association, have already condemned it, and airlines have suspended flights over Belarus. Additional policy actions are in the offing. Whether these actions will have impact is debatable, because these very organisations have held that a sovereign always reigns supreme. Yet, for optics, actions are necessary.

For now, the prospect of open and friendly skies is a distant dream. Intense lobbying continues against a backdrop where legacy airlines in the West have been given significant state support, where there is limited market-access when it come to China and where there are mounting losses for the airlines in West Asia. The search for that passenger willing to fly continues, though the passenger remains elusive, and countries like India remain rich source markets, due to diaspora, demographics and docility. Accessing such markets remains a proposition for many airlines, airports and entire countries. Aero-politics has again come front and centre.

The author is Managing partner, AT-TV, an aviation services firm

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, Check out latest IPO News, Best Performing IPOs, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.

Next Stories
1How to distribute Covid-19 vaccines
2Slipping on space-launch? India’s satellite customer base shrinking considerably
3Covid-19: Daily cases fall, but meaningful rebound still some distance away