NEW DELHI: Air India, India's national airline, is keen to open new destinations to Indian fliers this year as it prepares to face renewed competition from rival Jet Airways' international ambitions, especially in the backdrop of an impending deal with Etihad Airways.
Air India plans to connect New Delhi to new international cities like Birmingham, Moscow, Rome, Milan, Melbourne andSydney this year, arguing that if new destinations are not opened up, Indian traffic would get funneled to Abu Dhabi or Dubai airports for onward connections.
Pointing the flip-side to the government's policy of allowing foreign carriers to buy 49 per cent stake in Indian airlines, AI CMDRohit Nandan said that if the government doesn't penetrate new destinations, demand for "sixth freedom" or ferrying Indian passengers onwards from hub airports like Dubai and Singapore will automatically increase. Sixth freedom traffic rights refer to the right of any foreign airline to carry passengers or cargo from India to a third country via their own country.
"Foreign airlines are not coming to India to invest. The government has to watch carefully that for them FDI doesn't become merely a way to increase their share of bilateral rights. If Indian carriers don't invest in new destinations, over-capacity on certain routes will force passengers to use foreign airlines to go to destinations of their choice," Nandan told ET.
Till date Gulf airlines like Emirates, Etihad and Qatar, which are gateway carriers, dominate air routes between India and the Middle East to an extent that 40 per cent of total international Indian traffic is routed through the Gulf.
Most Indian carriers prefer to fly on some stock routes instead of trying new destinations and Air India plans to change its strategy as it prepares to face more intense competition from Middle Eastern and South East Asian carriers.
After Kingfisher AirlinesBSE 3.58 % lost its international slots, Jet AirwaysBSE -2.96 % on March 20 asked for permissions to operate more flights to Abu Dhabi, Dubai, Singapore, Hong Kong and Kuwait, among others.
In that context, Nandan's fear to lose more Indian passengers to Gulf carriers, especially with the deal between Jet Airways and Etihad, is becoming real. Explaining the scenario as to what would happen with foreign carriers buying into Indian airlines becomes a reality, he said other airlines should work to counter new competition.