Emirates President Tim Clark was in India last week and predicably he was questioned long and hard on the issue of bilaterals (the civil aviation agreement that governs air services between sovereign nations and is defined by the number of seats allotted for travel per week/ month on either side) that has been a bone of contention between the Gulf states and India for many a season.
As usual, Sir Tim said that it is a pity that the Indian Government does not see fit to expand the number of seats allocated to the Gulf states and said for starters another 50,000 seats could easily be absorbed by the airlines of the region.
Two-fold issue
He is right, 50,000 is no big deal. Emirates will just fit a couple more A 380s and 777s and add more stations to do the trick. The issue is two-fold. It won’t be just 50,000 seats. For all other purposes, the United Arab Emirates is one union as a country. When it comes to bilaterals, though, each of the Emirati nations has its own national carrier. For Dubai it is Emirates and Fly Dubai and, for Abu Dhabi it is Etihad and for Sharjah, it is Air Arabia.
So granting seats to one would mean opening the door for Etihad and Air Arabia to ask for their allocation as well. Not just that – all three countries are literally citystates as far as aviation goes – for Sharjah it is just Sharjah, for Dubai just Dubai and for Abu Dhabi (although a much larger emirate) it has just one airport in Abu Dhabi. Not just that, in terms of reciprocity, they must get one Indian airport to fly from at least, technically if the bilateral has to be even-handed. On the contrary, all three airlines fly to multiple Indian cities and act like magnets in attracting outbound Indian traffic to the west from their respective mega hubs.
The other complexity of granting more rights is that Qatar (again a city-state with one airport at Doha) will immediately ask for more seats, something that India has declined now for years. Again Qatar Airways has inbound traffic just to Doha while their outbound is spread all over India.
Building up airlines
While this is one side of the story, the other side is that India wants to build up its airlines and create hubs here for the likes of Air India and Indigo that can do long-haul pointto-point with their own aircraft. Good intention. The issue, though, is that at this point Indigo doesn’t have the aircraft to mount these flights and is actually reverse-engineered a code share arrangement with Turkish Airlines to use their aircraft in a wet lease arrangement (This means the airline leasing the plane from another carrier gets not just the aircraft, but also its crew, maintenance staff and insurance, but has to cover operating costs, such as fuel and airport fees, on its own).
In the case of Air India, their CEO Campbell Wilson just last week said that they were reducing six flights to the US because of a shortage of crew. Moreover with just 70 wide bodies on order, how many point-to-point services can AI mount, asked Clark. He is right. With a 1.3 billion population and a potential growth of 15 per cent in traffic each year for the next two decades, India has just about scratched its aviation potential. Protectionism is not the answer. Opening the doors and allowing competition to flourish and competing with the best should be the answer.
As Sir Tim said, there is enough for everybody!
